A Real Look at Connected Manufacturing Through IIoT

Vivek Maladkar May 20, 2015

Connected_Manufacturing“Internet of Things” is a buzz phrase many have been throwing around lately to describe the growing digital connectivity of, well… things. It applies to companies in every sector, as online tools and capabilities have revolutionized the way consumers and producers do everything. 

How does this affect manufacturers, engineering teams and the customers they serve? The Internet of Things has very real implications within various manufacturing industries, namely in the way information technologies have simplified stages of the product lifecycle. 

Take, for example, distribution and aftermarket services. The Industrial Internet of Things (IIoT) streamlines how companies track and manage distribution, and allows them to competitively reduce service and warranty costs. Almost one-third of all aftermarket services are now completed wirelessly. 

Cloud-based systems and Internet technologies have optimized the playbook for aftermarket services, just as they have in every other facet of manufacturing. Connected manufacturing, through the IIoT, is making it easier for manufacturing organizations to grow and develop top quality products transparently. 

In this article, we put some hard numbers behind the Industrial Internet of Things, to help you better understand how the IIoT is more than just a trend; it’s a major overhaul of how companies from Beijing to Boston are putting their products to market.

How the IIoT is Driving Worldwide Manufacturing Initiatives

The IIoT is changing the way manufacturing occurs. Now, connected organizations are given the competitive advantage over their others in their industry, as the Internet and software systems have made it possible to produce goods not only faster, but more affordably as well. As reported by Forbes in 2014, only 10% of industrial manufacturers are currently employing cloud-based data systems throughout their entire manufacturing enterprise; essentially, creating the connected manufacturing environment we’re discussing at length in this article.

What this means is that as much as 90% of leading manufacturers have not yet fully connected their manufacturing operations - they’re not experiencing the optimized cost and time-to-market that’s possible with Internet and mobile technologies. Those that are have the upper hand over their competition when it comes to production reliability and performance.

In a 2014 survey paper on the Internet of Things conducted by Lopez Research, it was found that, of the manufacturers implementing smart technologies in their business, a significant 82% had experienced increased operating efficiency. Many of the companies also saw far less product defects than before (49%) and big improvements in customer satisfaction (45%).

Automated software and connected applications are making it easier for manufacturing organizations to both identify their improvement areas, and quantify the most effective next steps in bettering their business.

As reported by Industry Week in October 2013, automaker Toyota began implementing real-time data systems in their Alabama plant to detect manufacturing error early on, and thus mitigate the costs associated with product reworking. With fully connected systems and instantaneous data capabilities, the company was able to generate yearly cost savings well beyond $500,000. Auto manufacturers were early to embrace the concepts of the IIoT, more so than most other industries; roughly 17% of all automotive companies now implement smart systems throughout their facilities.

The IIoT is Growing by the Minute

Business Insider, citing a report from BI Intelligence, estimates that roughly 23 billion Internet of Things-style devices and systems to be used within manufacturing industries by 2019. This large investment into the IIoT would fuel a $250+ billion dollar industry, which today sits around $46 billion. The initial investment costs and equipment, as more and more manufacturers realize every year, are worth the significant savings that are possible by implementing such technologies throughout the product lifecycle.

Connected manufacturing through the Industrial Internet of Things is going to transform from an industry trend to the manufacturing norm before the end of the decade. Companies that make the adjustment and implement smart systems within their operations get the advantage they need to overcome competing companies vying for market share.


Topics Business Transformation Internet of Things