7 Things You Should Know About IoT in Manufacturing

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The Internet of Things (IoT) and the Industrial Internet of Things (IIoT) are transforming manufacturing today, addressing the increasing demand for product customization, and changing customer expectations, especially surrounding the challenges associated with global supply chains and concerns regarding cybersecurity. 

86% of manufacturers have already adopted IIoT solutions, with 84% reporting they found them extremely effective, according to a 2017 Bsquare IIoT maturity survey. IIOT improves productivity, supercharges efficiency, and drives competitive advantage, therefore contributing to rapid growth in global spending on IIoT technology, with a projected increase from USD $76.70 billion in 2021 to $176.12 billion in 2029. 

The manufacturing industry’s spend on IoT solutions far exceeds that of any other industry, reaching $178 billion in 2016, more than double the second-largest market (transportation).

Here are seven things you should know about IoT in manufacturing.

1. Reduced Manufacturing Costs

The combination of minimized machine downtime, optimized asset and inventory management, efficient energy usage, agile operations, and supply chain management will significantly reduce operational manufacturing costs and reduce product cycle time. The use of IoT devices in the manufacturing industry will result in an additional economic value of between $1.2 and $3.7 trillion before 2025, McKinsey predicts.

2. Mass Product Customization Capabilities

IoT solutions will enable manufacturers to design products specifically tailored to consumer demands. The changing manufacturing processes that accommodate this mass customization will result in a huge increase in SKUs, ultimately making inventory management more complex.

IoT solutions address this complexity by connecting once-isolated parts of the production process so that production can be easily scaled up or down, resulting in happier customers and less waste. These solutions can also be used to monitor changes in demand to further customize products and forecast production. Over 76% of early adopters claim IoT solutions are increasing insight into customer preferences.

3. Discrete Manufacturing Will Account for the Majority of IoT Spending

Discrete manufacturing, which looks set to outpace batch and process manufacturing in 2019, is predicted to account for the largest proportion (53%) of IIoT spending in 2019, growing at a CAGR of 46% in 2018.

The adoption of IoT solutions will provide discrete manufacturers with the data needed to drive innovation and better manage complex production cycles, leading to improved operations and profitability. Reduced production cycles will also enable discrete manufacturers to offer short-notice production runs.

Discrete manufacturers will also benefit from a shift from scheduled to predictive maintenance and continuous monitoring to reduce downtime and boost efficiency. 

4. Security and Safety Enhancements across Manufacturing Industry

Cybersecurity and workplace safety are top concerns in the manufacturing industry. The International Labor Organization revealed that 151 workers have a work-related accident every 15 seconds, while manufacturing was recently ranked the most at-risk industry for cyberattacks.

When it comes to the adoption of new IIoT platforms, security is considered by manufacturers to be the most important feature.

Wearable IoT devices that monitor workers’ health and track high-risk activities in hazardous environments can reduce accidents by collecting important data such as location, heart rate, and skin temperature or reporting on dangers such as gas leaks. It’s estimated that IoT solutions addressing safety concerns could save companies $220 billion on injury and illness costs.

5. Enhanced Supply Chain Visibility and Accessibility

More than half of supply chain managers regard end-to-end supply chain visibility as a long way off, but IoT technologies will accelerate progress toward this goal. IoT will provide visibility into field operations, the manufacturing supply chain, and remote or outsourced operations, filling the gaps that ERP and MES systems cannot (due to their need for manual data input).

Integrating IoT technology into the supply chain provides manufacturers with detailed data about their products including location during transit, properties, production date, stock, shelf-life, and more.

6. Ease of Asset Management

IoT applications facilitate better asset management in manufacturing including tracking, inventory management, and predictive maintenance. This will improve reliability, extend equipment service life and provide manufacturers with a better return on their investments. Zebra’s 2017 Manufacturing Vision Study found that smart asset tracking will overtake old-school approaches by 2022, saving manufacturers between 20-50% in inventory carrying costs.

7. Process Optimization Through Dashboards, Visualization, and Condition Monitoring 

According to IoT Analytics’ IIoT Platforms For Manufacturing 2019 – 2024, there are three areas where manufacturers rely most on IIoT platforms to transform the industry:

• General process optimization: 43.1%
• General dashboards & visualization: 41.1%
• Condition monitoring: 32.7%

IBM reported that adopting IIoT insights for process optimization will increase product count by up to 20%.

IoT-assisted condition monitoring can help manufacturers identify delays within operations or recognize malfunctioning or underperforming machines to address problems promptly. When IoT devices detect readings that indicate potential machine damage, the source of the problem can be swiftly identified and resolved before the problem escalates.

Image Credit: MONOPOLY919 / Shutterstock