The Internet of Things (IoT) is a transformative movement in technology, particularly in manufacturing. IoT in manufacturing applies the concept of connected devices to power smart manufacturing.
To find out how IoT is affecting manufacturing organizations, we interviewed several industry leaders who see how IoT is changing their operations – and how they are preparing for a more connected future.
What are the IoT biggest challenges facing manufacturing organizations?
Maciej Kranz, Vice President of Strategic Innovation, Cisco: There are three major barriers to the wider adoption of IoT, with security ranking as the top one. Recent high-profile security attacks demonstrate IoT’s vulnerability to surface breaches as connectivity increases among devices and the internet. Security is everyone’s responsibility. The second barrier is slow adoption of open standards and interoperability. This is a challenge for vertically integrated vendors that traditionally prefer using proprietary or semi-proprietary technologies. Resistance to culture transformation is another impediment to the success of IoT. Because IoT accelerates the pace of change, organizations must speed up their internal processes, integrate external partners, empower their workforces to be innovative, and encourage more collaborative decision making across business units.
Dave Rauch, Senior Vice President of Drive Manufacturing, Western Digital: There are a number of challenges. First, the data sources that companies have – for example, production, process and product data – are often fragmented. In addition, sampling plans are not cohesive, and the payoffs are unclear. Adding to those challenges is a lack of critical skillsets.
Aaron Raymond, Senior Director, Electrolux Major Appliances: I believe the most challenging aspect is the impact that IoT has on speed and innovation. Manufacturing companies are traditionally thought of as large and capital-intensive operations that strive for repeatability and consistency. However, with the dawn of the IoT era, it’s not just that our marketplace is changing. In fact, our customer expectations are evolving and in many cases, still not defined.
Paul Reed, Principal Technical Specialist, USG: A big challenge is realizing that IoT, combined with analytics, is not simply a calculator that gives the right answer when you want it. Instead, IoT is a part of the manufacturing process. It’s up to manufacturers to understand that their models and decision processes will not be perfect at first. They will need to mature in place over time to be successful.
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What types of organizations are at the forefront of IoT?
Kranz: Bottom line, companies leading the IoT disruption today are well-established, large, industrial businesses with complex operations. They are getting ROI primarily from applying IoT for connected operations, remote operations, predictive analytics and preventive maintenance. Consumer IoT gets all the buzz, but the real opportunity and value today can be found in the industrial sector. According to IDC, industries forecast to make the largest IoT investments are manufacturing, transportation and utilities. The consumer sector ranks fourth overall today in terms of adoption.
Rauch: I think larger organizations have an advantage since they can better absorb projects of this size. Legacy technology can be an issue, but that is more manageable than not having enough resources. From a manufacturing perspective, I think we can look to the autonomous car as a good analogy. With a self-driving vehicle, you have lots of data signals coming in that have to be processed in a short period of time to make a decision, adjustments are made without human intervention, and very low tolerance for mistakes.
Reed: I think process industries have been at the forefront – chemicals, petroleum and other continuous manufacturing processes. Process control technology is the basis for IoT. The step beyond is to provide optimal process control points based on data-driven models. I think that an ideal IoT plant maximizes the intellectual contribution of employees and minimizes hands-on labor.
[Leading manufacturers] are getting ROI primarily from applying IoT for connected operations, remote operations, predictive analytics and preventive maintenance. Maciej Kranz Vice President of Strategic Innovation Cisco
What has your organization done to prepare for IoT?
Kranz: “It takes a village” to implement IoT. I have been working with enterprises and startups to build ecosystems of partners that can co-develop and co-implement complete IoT solutions with and for customers. This approach relies on interoperability across the entire IoT universe. Cisco has been a leader in establishing open standards for IoT. We are actively involved in numerous industry standards bodies and consortia working on architectural frameworks and standards for sensor communication, network access, cloud, fog and blockchain, just to name a few.
Rauch: The first step is recognizing the potential value of IoT. Then you can commit to a road map that allows the organization to make the transition.
Raymond: In our industry, IoT has changed the way appliances are bought and sold. We often talk about the “final mile,” or the last leg of getting an appliance delivered and installed. And while there are many positives to owning the final mile, there are many risks, especially in appliances. Consumers likely want someone to install a new refrigerator and haul away the old one – without being inconvenienced in the process. At Electrolux, that’s what we’re working on, building the capability to do just that. But that idea is a relatively new one, and 20 years ago, it wasn’t even a consideration.
Reed: I think the biggest thing would be to make sure that subject matter experts are supervising the development of your IoT technology. There should be no barrier between operations and IoT development. They have to be in sync throughout the development and deployment.