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IoT (Internet of Things) Impact on Manufacturers

The Internet of Things (IoT) has the opportunity to have a profound impact on the manufacturing sector for both large and small businesses. Whether it is monitoring operations on the factory floor, monitoring the health of specific manufacturing equipment, increasing connectivity between the supply chain, manufacturers, and consumers, or gaining valuable data insights, there are scores of opportunities where IoT can be truly transformational.

What is IoT Technology

In the broadest sense, the term IoT encompasses everything connected to the internet (or anything that could be connected to the internet.) However, it is mostly applicable to objects that can communicate back to a central data hub or processor. Said another way, the IoT is made up of devices – from simple sensors to smartphones and wearables – that are connected together.

Manufacturers are increasingly leveraging the IoT to achieve a variety of goals including cost reduction, increased efficiency, improved safety, meeting compliance requirements, and product innovation. IoT’s existence is primarily due to three factors: widely available internet access, smaller sensors, and cloud computing.

Initial Applications in Manufacturing

Monitoring and analytics (Predictive Analytics)

One of the leading negative impacts on profitability for manufacturers is unplanned downtime. A failure in one small component can lead to the entire system having to be shut down, severely impacting productivity levels. Through the use of IoT technology, companies can monitor the health of manufacturing equipment by combining sensor data with advanced analytics to predict when degradation and breakages are likely to occur. Monitoring the health of systems in this way is perhaps the most mature use case for the IoT. It makes failures less likely, improving productivity levels and efficiency.

Production Flow Monitoring

Over and under running of lots has been a long-standing condition of manufacturing that is a significant challenge. Even after data collection from equipment became possible, the machines are not always connected across the manufacturing floor and data is not always collected in real time. This lack of connectivity often means that the data is siloed within a department.

With IoT device control, production equipment can be monitored to ensure that lots are produced at the quantity required. Depending on the sensors and equipment type, many adjustments can be automated to tie all these territories together. The impact of connected equipment on production flow is realized through efficiency gains in several ways:

Tighter Lot Control – With machines connected and “talking” to one another, production lot can be completed precisely.

Staging Signals – Connected machines can also self-coordinate production to stagger and optimize changeover times as lots end at or near their total required production.

Maintenance – (as mentioned above)

Quality – Quality control has traditionally been an “after-the-fact” reality for many industries. With IoT connectivity, quality defects can be registered as they occur, checked against raw materials availability and additional units scheduled, and added to the production run to compensate – all without involving human interaction between production, operations, and scheduling.

Data-Driven Supply Chain

IoT is also being utilized to change many supply chain paradigms including – asset tracking, fleet management, and track and trace.

Asset tracking in real-time paired with cloud computing and data analytics can facilitate the creation of predictive models. In the case of fleet management, cloud platforms use the data from the fleet, weather conditions, and traffic models. The data is used to suggest the best route for the driver thus ensuring speedy delivery. The aggregation of data helps, in the long run, to optimize fuel consumption and reduce maintenance costs. Finally, imagine receiving the same type of raw material (or finished product) from two different suppliers. By scanning the material using a wearable device at the point of delivery, the manufacturer can easily save the data in a system and trace and track the origins of the material when required.

Improved Inventory Maintenance  

IoT can also positively affect inventory maintenance. A product nowadays usually has a barcode or an RFID tag for identification purposes. Thanks to IoT there is an increased ability to track products and store as much data as possible – location, temperature, damage, etc. The result is avoidance of overstocks or stock shortages as well as increased efficiency.

While there are many benefits to IoT technologies for manufacturers, challenges do exist, the primary being finding employees capable of envisioning and implementing these technologies in ways that provide the most benefit to your business. As manufacturers increasingly rely on technology, their need to hire tech-savvy employees is also increasing. The challenge is that there are not enough skilled employees to fill the number of open jobs. To fill the void, manufacturers are having to consider a few different options:

  • Train existing workers to perform skilled tasks.
  • Find ways to make a manufacturing industry IT role appealing to coders, application developers, network specialists, etc.

If you have questions about how IoT can impact your business, contact Tom Skoog at tskoog@blueandco.com.

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