Five to ten years ago, the Internet of Things (IoT) was a buzzword that no one could escape – circulating around board rooms and strategy meetings as the theoretical cure for all manufacturing problems in the future. Once thought to be an ‘all or nothing’ proposition that was an integral part of Industry 4.0, or Smart Manufacturing, it was going to revolutionize the industry.
Has it lived up to the hype? Absolutely. Is the entire industry revolutionized? Not exactly.
When IoT was first talked about, it was thought of as a tool that could only be afforded by the major manufacturers. This thought process is still present today, causing the hesitancy for small- and mid-size manufacturers and their delay for adoption. In reality, there are benefits to be had for all manufacturers even if they cannot perform a full implementation straight away.
Pandemic Unveils New Internet of Things Advantages
The IoT movement has been gaining momentum for years, but the recent acceleration by the Coronavirus pandemic has created a wave of new discovery for IoT as the world was forced into social distancing, isolation, and remote working. Businesses were pressed to rely on digital capabilities, especially for communication. Through this accelerated momentum and change, many companies learned that IoT did not cure all the ills within the manufacturing process, but it did lead to an incredible discovery: IoT does much more than initially thought.
In a recent study, Vodafone queried 1,639 companies to produce the 2020 Internet of Things Spotlight. This report unveiled the positive effects that IoT has had on their businesses.
- 84% felt IoT was a key factor in maintaining business during the Pandemic.
- Utilizing IoT allowed for a new way of organizing production, gaining insight into usages that has not be seen before, and enabled proactive supply chain management. As we continue to see inventory variability and supply uncertainty, the more proactively we can manage out businesses, the more productive we can continue to be.
- 95% of respondents saw a positive return on investment, in operational efficiency and creating new and connected products and services.
- The additional information, combined with AI and machine learning, has allowed for the manufacturers of today to drive the manufacturing of tomorrow. The piece to remember is that the innovation gain is not only for those that have completely smart plants. IoT can be utilized from one piece of equipment, one line, or the whole plant. All manufacturers should be reaping the benefits at some level.
- 73% of mature IoT adopters have seen a significant return on investment from IOT.
- 84% of businesses felt IoT has ensured business continuity.
4 New Truths about Scalable IoT Benefits
Truth: All sizes of manufacturers can reap IoT rewards.
Manufacturers of all sizes can and should be utilizing IoT in the way that is most beneficial to them. This can be as small as utilizing it in one machine, or as large as having a fully integrated plant.
Truth: Cost is no longer a barrier to IoT advantages.
Cost should not be considered the barrier as it once was, but planning will be needed. Considerations and planning can ensure that over time sensors can be put into the equipment, conveyers, etc. to create IoT benefits for small and medium-sized manufacturers even if they cannot do a complete implementation.
Truth: Long-term plant viability is dependent on IoT.
The bottom line is that the usage of IoT in plants has enabled companies to improve productivity, drive innovation, and support business continuity. Now, and in the future, there will be more need to increase margins by increasing efficiencies rather than the ability to raise prices. This is one of many tools that manufacturers should have in their toolboxes to help increase efficiencies and, therefore, increase the viability of their plants.
Truth: IoT and people working together make plants more adaptable.
Lastly, IoT will never replace people. People, combined with this technology, is creating confidence and certainty in a world that is more volatile than ever before. By better understanding the opportunities and constraints contained inside the plant, we are better able to anticipate and dictate the response to external opportunities and constraints.
K·Coe Isom works with manufacturing plants across the United States. Should you have questions regarding Internet of Things planning considerations or the financial management of IoT implementation, contact a K·Coe manufacturing advisor.