Macro and Micro Benefits of the Industrial Internet of Things

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Macro and Micro Benefits of the Industrial Internet of Things

An exclusive article by Monica Ricci*, Associate Researcher at MachNation.

The global manufacturing sector will continue to capture the greatest percentage of IoT investment in the near term because of the significant gains it is expected to deliver.

The foundations of Industrial IoT enhance existing manufacturing assets with a range of technology including IoT platforms** that embeds intelligence into complex processes and supply chains to create, distribute and manage goods. The resulting “smart factories” will change not only the nature of the manufacturing process but will bring about enhancements to:

  • The price of goods, both components and end products
  • Where jobs are located and what types of jobs there are
  • The suppliers’ ability to respond to customers’ wants and needs

These outcomes are expected to result in significant restructuring of economies around the globe, as the comparative advantage of producing goods, and their ingredients and components, shifts as a result of IoT and related industrial technology like IoT edge platforms.

Technology Across the Supply Chain

The Industrial IoT brings communications and control devices to assets within a plant. But it doesn’t stop there; the industrial IoT (IIoT) actively and securely connects all points where goods are transferred from plant to the end customer including the warehouse, fleets, shippers, ports, distribution centers. And finally, to close the loop, the IIoT connects the product while it is in use at the customer site, providing invaluable data about its use. IoT data generated and captured across this connected supply chain will be consumed by industrial analysis and intelligence applications that will monitor processes, reveal opportunities to improve and optimize them, and surface opportunities to change the manufacturer’s competitive position in the market.

IIoTThe IIoT is the backbone of a transformed manufacturer and works in concert with other elements of this revolution including robotics, autonomous vehicles, artificial intelligence and more to change the value equation in several dimensions: lower costs, faster time-to-market with new products, and greater customer satisfaction resulting from a better understanding of their needs and a significantly improved ability to address those needs.

Room for Improvement

Many IIoT advantages will accumulate at the macro level, improving the market position of a manufacturer or changing the structure of the local economy as the industrial processes, jobs and outputs shift. But there are numerous direct benefits of the Industrial IoT that will deliver rapid and measurable returns in the short term, including

    1. Delivering automation and digitization of information; paper processes can be replaced with digital information, for example in fleet management and shipping use cases where information about originator, buyer, carrier and cargo can be automatically and seamlessly exchanged at every point along the route across an ocean, though a port and customs authority, and on the road to and from a warehouse or distribution center.
    2. Asset management and maintenance on the factory floor; when the performance of every component and assets on an assembly line can be examined in real-time, maintenance and repair activities can be proactively initiated before failures occur and production is impacted.
    3. Plant management; numerous IoT technologies can be employed to optimize the environment for the building, the machines and the workforce alike, including smart ventilation controls, environmental and air quality measurements, security and access management, inventory measurement and controls of manufacturing liquids and gases, monitoring radiation and other hazardous materials, and automating facilities management.
    4. Finally, increased customer satisfaction and competitive differentiation in the market can be achieved through better and more detailed understanding of how the product is used by the customer; when the goods themselves are Iot connected, the manufacturer can capture and analyze information about its use and drive more effective product roadmaps.

A Lot of Moving Parts to Manage

Managing the extensive network of connected assets, products and collaborators in an Industrial IoT supply chain, requires an IoT platform that delivers the maximum degree of flexibility, interoperability and efficiency across the ecosystem. The industrial IoT gains to be had are compelling, the investments are significant, and demonstrable gains sought quickly. The newly connected and intelligent elements in the industrial supply chain must be managed. The manufacturer must capitalize from the connected data. And this means that the focus and skills in manufacturing management and maintenance shift to include:

  • Connectivity network protocol expertise, development and management
  • IoT edge platforms for data and device management
  • Cloud connectivity and access controls for device management, data storage and distribution
  • Data analytics and visualization

The IoT and digital transformation of industry is underway, attracting significant investment in every region and segment. Stay with me as I continue to explore this subject, presenting industrial use cases where the IoT holds out the promise of delivering real, measurable business outcomes including warehouse operations, factory asset management, predictive maintenance, smart facilities, and more.

* About the author:
Monica Ricci is an Associate Researcher at MachNation. She has over 25 years of experience in the telecommunications and technology industries. Monica’s primary areas of expertise are customer care, charging, billing and partner settlement processes for the enterprise communications services value chain. She is a specialist in IoT business models and their impact on carrier OSS/BSS including pricing and revenue sharing. She has held management positions in product management and marketing at CSG International and radio frequency engineering roles at an early predecessor of Verizon.
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