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 percent of manufacturers have already adopted IIoT solutions, with 84% reporting they found them extremely effective, according to a 2017 Bsquare IIoT maturity survey. IIOT enhances productivity, supercharges efficiency, and drives competitive advantage, therefore leading to rapid growth in spending on IIoT technology, with a projected increase from $1.67 billion in 2018 to $12.44 billion in 2024.

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

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

Easily Lower Manufacturing Costs with IoT for Manufacturing

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 apparatus in the manufacturing industry will lead to an additional economic value of between $1.2 and $3.7 trillion before 2025.

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 is going to lead to a huge increase in SKUs, ultimately making stock management more complex.

IoT solutions address this complexity by linking 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 track changes in demand to further customize products and forecast production. Over 76 percent of early adopters claim IoT solutions are increasing insight into customer preferences.

Discrete Manufacturing Will Account for the Majority of IoT Spending

Discrete manufacturing, which appears 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 manufacturing runs.

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

Security and Safety Enhancements across Manufacturing Industry

Cybersecurity and workplace safety are top concerns in the manufacturing sector. The International Labor Organization revealed that 151 employees 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, safety is considered by manufacturers are 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 is estimated that IoT solutions addressing safety concerns could save companies $220 billion on injury and illness costs.

Enhanced Supply Chain Visibility and Accessibility with IoT in Manufacturing

More than half of supply chain managers regard end-to-end supply chain visibility as a long way off, but IoT technology 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 (because of their need for manual data input).

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

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.

Process Optimization Through Dashboards, Visualization, and Condition Monitoring

According to IoT Analytics’ IIoT Platforms For Manufacturing 2019 — 2024, there are 3 areas where manufacturers rely most on IIoT platforms to transform the industry:

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

IBM reported that adopting IIoT insights for process optimization will increase product count by around 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 issue escalates.

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