Benefits of IoT to Industry and Manufacturing

12 min readMay 26, 2021

“Everything that can be automated will be automated.” — Robert Cannon

The Internet of Things (IoT) is a key component of global industrial transformation, and the manufacturing sector leads in leveraging this technology. As per IDC Data, the sector had invested $178 billion in IoT in 201⁶¹. Operations accounted for the main spending user case, followed by production asset management, maintenance and field service. Manufacturing companies are taking a serious look at IoT. In fact, IoT has enabled manufacturers to experience a 28.5 percent average revenue increase, according to TATA Consultancy Services. But what exactly is IoT, and how does it work in the context of manufacturing?

What is IoT and IIoT?

The IoT is a network of connected devices that can communicate with each other and provide data to users through the Internet. IoT devices can connect to the Internet and often have sensors that enable them to collect data. An IoT device can be useful on its own, but when you use numerous devices together, they become even more valuable.With more than 7 billion connected IoT devices today, experts are expecting this number to grow 22 billion by 2025.

IIoT is a subcategory of IoT. Industrial IoT (IIoT) refers to the application of IoT technology in industrial settings, especially with respect to instrumentation and control of sensors and devices that engage cloud technologies. IIoT can have many of the same uses and benefits that IoT can. Recently, industries have used machine-to-machine communication (M2M) to achieve wireless automation and control. But with the emergence of cloud and allied technologies (such as analytics and machine learning), industries can achieve a new automation layer and with it create new revenue and business models. IIoT is sometimes called the fourth wave of the industrial revolution, or Industry 4.0.

Interesting Facts about IoT:

Did you know that by the year 2023, it’s estimated that 70% of all the automobiles will be connected to IoT?

IoT has enabled manufacturers to increase their average revenue by 28.5%.
Companies believe IoT and other digital technologies increase productivity by 12% at least.
The industrial IoT market size is set to reach $124 billion by the end of 2021.
More than 50% of the new business systems will incorporate some IoT element by 2022.

Benefits of IOT to Industry & Manufacturing:

What if you could use advanced analytics to envisage events before they happened, use real-time actionable insights to increase production and help your operatives know the right decision to take at any given time? Industrial IoT is driving such capabilities enabling unparalleled operational efficiency, productivity, and performance like never seen before. Here are some of the benefits of IoT to industry and Manufacturing.

Real Time Monitoring & Digital/Connected Factory:

IoT enabled machinery can transmit operational information to the partners like original equipment manufacturers and to field engineers. This will enable operation managers and factory heads to remotely manage the factory units and take advantage of process automation and optimization. Along with this, a digitally connected unit will establish a better line of commands and help identify key result areas (KRAs) for managers.

2. Predictive Maintenance and Facility Management:

Traditionally, manufacturers have employed a time-based approach for planning the maintenance schedules of their machinery and equipment. However, according to the ARC group study³, only 18% of equipment fails on account of age, whereas 82% of failures occur randomly. This proves that a time-based approach is not efficient and may prove costly in the long run.

Manufacturers can avoid such ineffective maintenance routines by leveraging industrial IoT and data science for predictive maintenance. The use of IoT sensors in manufacturing equipment enables condition-based maintenance alerts. IoT Sensors can actively monitor machines and send an alert when the equipment deviates from its prescribed parameters. By ensuring the prescribed working environment for machinery, manufacturers can conserve energy, reduce costs, eliminate machine downtime, and increase operational efficiency. As an example, steel plants have several furnaces using water cooling panels for temperature control. Any leakages in the panels can result in safety issues and production loss. With IoT based predictive maintenance, plant managers can strategically identify anomalies and conduct a root cause analysis to prevent machine failures and delays in production.

3. Accelerating Performance:

Energy is one of the largest expenses for manufacturing firms. Bills arrive a couple of weeks before the end of the billing cycle and highlight all of the energy used for the entire factory. But the problem is, these bills detail total energy consumption, and there is no way to break down the bill to better understand where specific inefficiencies reside. Yet nearly 77 percent of companies reported obtaining energy consumption data from their monthly utility bills or energy monitoring tools, which both have limited points of data.

IoT closes that gap, as it helps to collect and understand data right down to device level. Do you have a device that is underperforming? If so, the technology will pinpoint that device so you can figure out how to boost efficiency. This real-time data can deliver interesting insights, such as off-hour consumption, recommendations for optimizing production schedules and other opportunities for savings. Similarly, managers can evaluate different locations and pinpoint hidden operational inefficiencies and waste.

4. Production flow monitoring:

IoT in manufacturing can enable the monitoring of production lines starting from the refining process down to the packaging of final products. This complete monitoring of the process in (near) real-time provides scope to recommend adjustments in operations for better management of operational cost. Moreover, the close monitoring highlights lags in production thus eliminating wastes and unnecessary work in progress inventory.

5. Smart Metering:

IoT has also introduced the manufacturing sector, utilities and other industries to the world of smart meters that can monitor the consumption of water, electric power and other fuels. IoT sensors allow organizations to gauge the specific use and deploy practices for more effective usage of resources.

With customizable end-user dashboards deployed by IoT services vendors, manufacturers can comprehensively analyse the results of smart meter monitoring. They can also compare costs, efficiencies and the carbon footprint of alternative resources to incorporate better options in their manufacturing processes.

6. Inventory management:

IoT applications permit the monitoring of events across a supply chain. Using these systems, the inventory is tracked and traced globally on a line-item level and the users are notified of any significant deviations from the plans. This provides cross-channel visibility into inventories and managers are provided with realistic estimates of the available material, work in progress and estimated the arrival time of new materials.

Together with radio frequency identification (RFID), IoT makes inventory management an efficient and seamless process. Every item in the inventory gets an RFID tag, and each tag has a unique identification number (UID) comprising encoded digital information about the item. RFID readers can scan the tags, and the data extracted gets transmitted to the cloud for processing.

IoT gives cross-channel visibility to supply chain managers with a realistic estimate of available materials, the arrival of new materials and work-in-progress, optimizing shared costs in the value chain. Ultimately this optimizes supply and reduces shared costs in the value chain.

7. Safety and Security in Operation :

IIoT helps to ensure a safer workplace. Paired with wearable devices, IIoT allows monitoring workers’ health state and risky activities that can lead to injuries.In combination with big data analytics, IoT also optimises the safety of workers, equipment and operations in a manufacturing plant. It can be used to track KPIs like worker absences, vehicle mishaps, machinery damage and any other mishaps that affect normal activities. Employees using these devices can also be monitored continuously for their health metrics while working in factories and fields. It helps to understand their exposure to fumes produced in a process, stress levels, heart rate, fatigue and general movement. The information gathered can help business owners improve their compliance structure and reduce insurance costs. If there are disparate suppliers and security protocols and no standardization, IoT can cause security concerns.

8. Quality control:

In a standard reactive quality control process, manufacturers produce an item, their quality control unit tests it, and they hope to catch and rectify the flaws before the product reaches the market. IoT makes this process proactive with thermal and video sensors collecting complete product data through different stages of a product cycle. The products can also be tested at each manufacturing step to check if their attributes are within specifications. In addition, instrumentation and monitoring of manufacturing equipment help quality control personnel to check if and where equipment calibration diverges from standard settings — such inaccuracies must be thwarted in time to avoid misalignment of products. Moreover, if used in the final product, the IoT device can provide data about the customer sentiments on using the product. All of these inputs can later be analyzed to identify and correct quality issues.

RJ Corp, the largest bottler of Pepsi in India, uses IoT sensors to capture different data parameters required to gauge quality on a real-time basis.

9. Smart Packaging:

Smart packaging that directly uses materials with embedded interconnectedness provides advanced benefits of IoT for manufacturers. By using IoT sensors in products and/or packaging, manufacturers can gain insights into the usage patterns and handling of products from multiple customers. Smart tracking mechanisms can also trace product deterioration during transit and impact of weather, road and other environment variables on the product. A prime aspect of smart packaging is that it enables consumers to engage with it, as well as generates data to handle a product more effectively. Smart packaging may manifest itself in the form of recipe videos, beauty tutorials and other demonstrations to explain the product usage. The idea is to add value for consumers and also collect data — through smart tracking — to further optimize operations and boost efficiency.

10. Logistics and Supply Chain Optimization:

The Industrial IoT (IIoT) can provide access to real-time supply chain information by tracking materials, equipment, and products as they move through the supply chain. Effective reporting enables manufacturers to collect and feed delivery information into ERP, PLM and other systems. By connecting plants to suppliers, all the parties concerned with the supply chain can trace interdependencies, material flow and manufacturing cycle times. This data will help manufacturers predict issues, reduces inventory and potentially reduces capital requirements.

IoT-driven manufacturing operations:

According to an IDC research, by 2025, the improvements in operations driven by IoT applications could be worth more than $470 billion per year. IoT applications for manufacturing deal with such operations as monitoring and optimizing equipment performance, production quality control, and human-to-machine interaction.

A Real-Time Competitive Edge for the Future:

The manufacturing industry is competitive, and companies are constantly seeking an edge to stay competitive and get ahead. They want to become more efficient, operate with greater profitability and serve customers better. IoT technology provides a powerful set of tools that can deliver these advantages. It takes data that has always been there but was never accessible before and puts it into the hands of those who need it most.

As a result, managers can transform a state of “putting out fires” into one that is more efficient and allows for companies to build new strategies focused on growth and innovation. Product quality is solid because the equipment is operating optimally, and clients are happier — so the company is positioned with greater strength and resiliency. It is these benefits that make IoT a critical tool for manufacturing companies that want to grow and thrive in the future.

Challenges:

1. Compatibility and Interoperability of Different IoT systems

As per the market analysts at McKinsey, 40% to 60% of the total value lies in our ability to achieve interoperability between different IoT systems. With numerous vendors, OEMs, and service providers, it becomes really difficult to maintain interoperability between different IoT systems.

2. Identification and Authentication of Technologies

According to a report, there are around 20 billion connected devices at present, and to connect all the devices involves a lot of security risks and not just complexity. Bringing along a large number of connected devices on one platform needs formalization and system architecture that can identify and authenticate those devices.

3. Integration of IoT Products with IoT Platforms

For the successful implementation of IoT application, enterprises need to integrate various IoT connected products with right IoT platforms. Lack of proper integration could lead to abnormalities in functions and efficiency to deliver value to the customers.

4. Connectivity

It is the part of networking challenges, as the Internet is still not available everywhere at the same speed. A global mobile satellite company Inmarsat revealed that 24% finds connectivity issues as the one of the biggest challenges in IoT deployment.

5. Handling Unstructured Data

Growing connected devices will increase the challenges of handling unstructured data on the parameters of volume, velocity, and variety. However, the real challenge for the organizations is to determine which data is valuable, as only quality data is actionable data. According to a survey, 80% of today’s data is unstructured data and so the data cannot be stored in SQL format.

6. Data Capturing Capabilities

As IoT is mainly about dependence on sensors for signals and networks for the distribution, chances are that due to certain anomalies in runtime, such as a shutdown of power, incorrect data may get recorded.

7. Intelligent Analytics

At this stage, we are at the very purpose of IoT i.e. translating data into meaningful information. A flaw in data or data model could lead to false positives and false negatives. We have to understand the data in itself is not an insight, rather right questions have to be asked from the precise data to gain the insight.

8. Data Security and Privacy Issues

Even top companies like Apple, known for big security claims, and visionaries like Elon Musk have not been spared by hackers. Recent cases of ransomware attacks have also challenged the confidence of corporations. A latest research claims that by 2020, 25% of cyber attacks will target IoT devices.

9. Consumer Awareness

Many people are not aware of IoT, but they understand the dependence on Smart Apps like news apps, stocks applications, entertainment applications. It is not actually important for the consumers to know how things work technically, but lack of basic awareness can create a fear of security and cost, which could lead to the slow adoption of technology.

Conclusion

IoT has a vital role to play in the near future. Machines would dominate most of the routine and mundane activities. The IoT will allow users to command and operate machines with ease.

This would definitely make human lives more convenient and improve the quality of life. A great amount of time can be saved by automating devices which will perform the mundane tasks on a fixed schedule. The IoT currently might still have glitches and possibly expose data to a security breach.

But there are also untold possibilities of the IoT technology which can substantially revolutionize the whole world.

“We have a deep need and desire to connect. Everything in the history of communication technology suggests we will take advantage of every opportunity to connect more richly and deeply. I see no evidence for a reversal of that trend.” — Peter Morville

References:-

Written by:-

Swaraj Kothekar

Yohaan Kudtarkar

Madhura Kunachi

Pratiksha Kulkarni

Ojas Mandlecha

-Vishwakarma Institute of Technology, Pune