It is not the strongest of the species that survives, nor the most intelligent; it is the one most adaptable to change. – saying often attributed to Charles Darwin
Throughout its history, change has arguably been the world’s only constant factor. In business and industry, big change often happens in big waves. Take manufacturing as an example. It has undergone three big waves of transformation, and now a fourth is underway.
In the 18th century, the first wave of the industrial revolution — now termed Industry 1.0 — was marked by the adoption of steam-powered engines, which transformed labor-intensive processes and boosted productivity. Industry 2.0 was driven by the introduction of steel, electricity and assembly lines in factories, which raised the productivity bar. The third industrial revolution, also known as the digital revolution, began around the late 1950s or 1960s with the deployment of more electronic technology, including in factories.
Today, we are in the middle of the Fourth Industrial Revolution, or Industry 4.0, where the Internet of Things (IoT) plays a central role in connecting real-time data and merging cyber and physical systems. As the head of platforms business unit at a company that offers IoT solutions, I believe companies that cannot adapt to the new technology will quickly lose their competitiveness and then disappear — like buggy whip manufacturers.
What Is Industrial IoT (IIoT)?
Think of IIoT as the connective tissue that links simple sensors, complex machines such as manufacturing robots and more to the internet and enterprise systems. This integration provides real-time insights into the manufacturing processes and enables increased productivity, reduced downtime and greater quality control.
According to McKinsey, remote assistance and maintenance tools, in particular, are capable of driving field-service cost reductions of up to 40%. Part of the way it can achieve this is through learning and building efficiencies into the manufacturing processes. We can call this the smartphone effect.
If you consider the world of smartphones and app developers, one thing unites the way they operate. Once downloaded, their apps feed information on usage back to the developers. The developers learn how people interact with the application, what features are the most popular, and which add-ons generate the most revenues. As a result, developers can release upgrades to the app and constantly improve their appeal, usage and profitability.
The IIoT takes this functionality into the industrial environment by creating a feedback channel for equipment, machinery and processes. At Telit, we created a unique two-pronged approach to IIoT that divides projects into two main groups: connected machines and connected factories.
This type of project focuses on improving machinery functionalities. The builders or suppliers of the machines often provide the IoT technology in their equipment as part of their service. The machines provide valuable feedback and deliver business and operational benefits.
For example, suppliers sometimes have remote access to the machines that they sell to the market so they can gain added market insight and a competitive advantage. And by connecting their industrial equipment to the internet, third-party suppliers and machine builders can achieve a variety of benefits for themselves and their customers by taking the following steps:
1. Build-measure-learn: By measuring how your customers use your machines, you can focus your innovation on what really matters to your customer — not on what you think matters to your customer.
2. New revenue through services: Find ways to gain online feedback from your product and then offer value-added services. Examples include process monitoring, maintenance and calibration.
3. Reducing travel time and cost: Covid-19 taught us that many services can be done remotely. Collect data from your machine and enable remote connectivity to it so you don't have to travel to support your products.
4. Staying ahead of the competition: We are all used to a digital life. Create machines that tell industrial managers when something is wrong and communicate with their ERP systems. Make sure they can manage them on their smartphones.
These projects have all their devices under the same roof and are reachable by the same network. The success of these complex projects is determined by the clarity of thinking regarding strategy and desired outcomes, which should be agreed on at the very start. Get the right understanding — at the outset — of what can be delivered and achieved to help crystallize the planning process and determine the way forward technically.
You should approach connected factory projects by ensuring you create a complete bi-directional information layer, connecting machines and external sensors to databases, enterprise systems and cloud solutions. Data collection can also bring complex challenges. Different protocols and high latency rates are examples of problems you need to solve with the right software and strategy.
With that in place, you can begin to understand the reasons for any inefficiencies. Also, by applying KPIs and overall equipment efficiency (OEE) controls, you can measure productivity, scrutinize the details and improve your processes.
You can also use your IIoT platform to minimize downtime. Sensors for temperature, vibration, voltage fluctuations and more enable better preventative maintenance by identifying emerging problems. And you can feed this data into analytics tools from vendors such as IBM, Microsoft, Google and AWS. The quality of your data is key to the quality of your analysis.
If you are responsible for a manufacturing process or for a product line, an IIoT strategy certainly needs to be on your road map. If you do it right, the investments in this process shouldn’t be prohibitively expensive. The most important thing is to make sure the organization understands how the technology will transform the business. That’s key for maximizing the ROI. Running a data-driven company can bring competitive advantages, but it also challenges managers to do things differently. That’s not always easy, but the payoff is worth it.