The Internet of Things Brings a New Era of Manufacturing

A new age is about to dawn for the manufacturing industry worldwide. Technologies related to the Internet of Thingsare ushering in a revolution that will forever change the management of manufacturing processes. Whereas in the past the production process could only be tracked at the batch level, soon total visibility will be available at the unit-level. Many are calling this the beginning of the era of smart manufacturing.

What is The Internet of Things (IoT)?

The Internet of Things (IoT) is a system of interconnected computing devices, machines, objects, or people that have the ability to transfer data over a network without requiring human-to-human or human-to-computer interaction. In short, it is the idea of connecting pretty much any object with an on and off switch to the Internet and/or each other. The Internet of Things has the potential to connect pretty much everything including, home appliances, wearable devices, coffee makers, medical equipment, vehicles, sprinkler systems, and anything else with a power source. Gartner analysis says that by 2020 there will be more than 26 billion connected devices, while others suggest that it may be more than 100 billion.

Kevin Ashton is the co-founder and executive director of the Auto-ID Center at MIT. He is credited with the first mention of the Internet of Things in a presentation he made to Procter & Gamble in 1999. Here’s how he describes its potential,

“If we had computers that knew everything there was to know about things — using data they gathered without any help from us — we would be able to track and count everything and greatly reduce waste, loss and cost. We would know when things needed replacing, repairing or recalling and whether they were fresh or past their best.”

The IoT and Manufacturing

In terms of manufacturing, the IoT allows for a “smart” ecosystem where data from the entire supply chain and the plant floor is collected in real-time. It is made visible to people and other systems and turned into actionable information. Smart manufacturing gives businesses complete visibility across the supply chain enabling them to remove friction from the process, use resources more efficiently, and optimize supply and demand. When manufacturing is cloud-based and smart and devices are connected, processes are able to govern themselves. Machines can take corrective action to avoid defects and parts are automatically replenished when needed.

The shift is so significant that some leaders are calling the IoT the fourth industrial revolution. (The first were the steam engine, the conveyor belt, and the first phase of automation technology.)

McKinsey’s Markus Löffler explained it this way,

“Most companies think of physical flows—meaning the flow of material components through the supply chain—as separate from information flows and then consider how and where to coordinate and synchronize them. After the fourth industrial revolution, there will no longer be a difference between information and materials, because products will be inextricably linked to ‘their’ information.”

According to research conducted by Zebra Technologies Corporation, 97% of 600 manufacturers they surveyed believe the Internet of Things is the most significant technology initiative of the decade. Jim Hilton, senior director, global manufacturing principal, at Zebra Technologies, explained,

“IoT is about enterprise asset intelligence, and answers some important questions. What do you need to find out at a given point of activity – whether it happens on your property, at a vendor or elsewhere in the supply chain? From picking, to trailer unloading, to equipment service calls, you need that information in timely manner so you can still do something about it.”

Where We Are Today

Although there are plenty of advances on the horizon, technology related to the Internet of Things can be found in many industries today including agriculture, healthcare, energy, transportation, building management, and, of course, manufacturing. Today, manufacturers are using IoT technologies to track assets, perform preventative maintenance, unify control rooms, and measure the efficiency of plant operations. Manufacturers of all types from electronics to chemicals and durable goods are making big investments in IoT and those investments are paying off. According to a TATA Consultancy survey, those using IoT solutions in 2014 got a 28.5% increase in revenues over the prior year.

PwC conducted a survey of manufacturers in the United States to get more insight about their current activities and future plans related to smart manufacturing and IoT. They found:

• 35% of US manufacturers are currently collecting and using data generated by smart sensors to enhance manufacturing/operating processes
• 34% believe it is “extremely critical” that US manufacturers adopt an IoT strategy in their operations
• 38% currently embed sensors in products that enable end-users/customers to collect sensor-generated data

Business Insider recently issued a report on the state of IoT and smart manufacturing. They estimate that manufacturers worldwide will spend $70 billion on IoT solutions in 2020. Spending for 2015 was $29 billion. The report did point out some of the barriers that manufacturers will face as they transition to IoT-based manufacturing. They include the increasing threat of a cyber-attack (made all the more real by last week’s IoT-based DDoS attack that brought down hundreds of websites including Twitter), difficulty determining ROI, integration challenges, and concerns about automation caused job losses.

Have no doubt that these challenges will be quickly overcome because the upside is enormous. Manufacturing operations are already functioning more efficiently than ever before due to smart sensors and connected manufacturing floors. Users of the technology enjoy less machine downtime, better resource utilization and faster time to market.

The transition to smart manufacturing has been underway for some time and it won’t get completed overnight, but new, more sophisticated technologies are coming online every day. The Internet of Things is far more than the next technology buzzword. The possibilities are almost impossible to imagine, and it is difficult to overestimate the potential. For manufacturers, the move to smart manufacturing may very well change everything.