• Internet of Things
  • Experfy Editor, Experfy Editor
  • JUN 27, 2017

Industrial IoT and the Rise of Smart Manufacturing

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The industrial Internet of Things, known as the Industry 4.0 or the Fourth Industrial Revolution, has become a buzzword for automating the smart manufacturing process. It is shaping the future of smart and intelligent manufacturing. No matter what you call it, this connected or smart manufacturing has become all pervasive. Its prominence has raised to such an extent that Angela Merkel and Barack Obama, two of the world’s most eminent leaders, inaugurated Hannover Messe, one of the world’s largest trade fairs, in 2016. The main theme was Industry 4.0. The Industrial Internet of Things (IIoT) is a set of the Internet of Things (IoT) that mainly involves manufacturing and connecting sensors to the internet. It can provide better information for manufacturing and business decisions. The only difference between IoT and Industrial IoT is that the latter deals with the closed environment for communication between a company and its business, whereas the IoT is ubiquitously open by its very nature.

Rising of Smart Manufacturing with Industrial Internet of Things


Goldman Sachs, in its report on “The Internet of Things: The Next Mega-Trend” in 2014 explained that "the global industrial sector is poised to undergo a fundamental structural change akin to the industrial revolution as we usher in the IoT. Equipment is becoming more digitized and more connected, establishing networks between machines, humans, and the Internet, leading to the creation of new ecosystems that enable higher productivity, better energy efficiency, and higher profitability. While we are still in the nascent stages of adoption, we believe the IoT opportunity for Industrials could amount to $2 trillion by 2020. The IoT has the potential to impact everything from new product opportunities, to shop floor optimization, to factory worker efficiency gains that will power top-line and bottom-line gains." 

While many big companies around the world like Siemens and Bosch are adapting to the Industrial Internet of Things, the maturity of the Industrial IoT platform is still at an early stage for interconnecting devices that can improve the industrial performance. In fact, Bosch coined the word Industry 4.0. “It’s definitely an evolution,” says Werner Struth, Member of the Board of Management and Industry 4.0 specialist. “That’s an extremely important point. Industry 4.0”, he says, “is now a reality that’s built up over the course of recent years, and no longer a disparate set of abstract concepts”. Struth opined that sensors are the fundamental enabler in the manufacturing that helps realize big benefits. According to him, sensors fitted on the production can offer status updates continually comparable with a ‘digital twin’, a system’s simulation that runs 100% efficiently. This enables flagging deviations quickly and identifying trends easily. Struth points out that Bosch, this way, gained improvement by 25% in output in the production of its ABS (automatic braking system), and EPS (electronic stability program) with the connected and smart lines.

Many start-ups in the Industrial IoT for smart manufacturing turning into smart factories is gaining the momentum. The aim of these manufacturing Industrial IoT start-ups is to help reduce their unpredictable downtime to increase operational efficiency by analyzing the data collated from operators and machines in real-time using the devices and sensors. Another objective is to increasingly use more of interconnected devices to improve their industrial performances. 

Forecast for the Industrial IoT


The Forbes’ roundup of Industrial IoT 2016 forecasts and market estimates reflects a growing focus that Industrial IoT can deliver value in solving complex manufacturing problems. Below are some of the forecasts.
The Industrial Internet of Things potential estimated to deliver up to $11.1 trillion annually by 2025. 


Source: GE Digital, the Emerging Industrial App Economy.

As per the prediction of Industry ARC research the Industrial IoT market can reach $123.89 billion by 2021. The following is a graphical comparison of market estimates from Accenture, Morgan Stanley, and Industry ARC. 


Source: The Industrial Internet of Things (Industrial IoT): innovation, benefits, and barriers.

Value from Industrial IoT Automation Technologies


As the internet has and still is changing the shape of many physical and technological developments involving every aspect of the human landscape, similarly the Industrial Internet of Things is dynamically changing the manufacturing to a landscape of the smart and intelligent platform. It has become a significant development for every business involved in manufacturing to beat the competition. There is a need for manufacturers to understand the immense potentiality of Industrial IoT and its adoption swiftly. They can derive value from Industrial IoT automation technologies and its open standards in their transformation to become smart manufacturers. 

Simply, they can benefit from the highly responsive infrastructure of smart connected devices and sensors that can automate their data-driven decisions to improve manufacturing efficiency. They can experience improvement in cybersecurity, efficiency in better safety management, profitability and workforce and machinery performance. They can also experience downtime in manufacturing, product customization, and greater business systems. According to Andrew Timms, sales director, APAC with Paessler AG, a developer of PRTG network monitoring software, "An assembly line powered by IIoT might never have to deal with downtime thanks to machinery that can anticipate when it needs to order new parts and can self-repair”. 

Thus, Industrial IoT can substantially improve smart manufacturing productivity that also influences the quality of offerings. The connected devices and sensors in Industrial IoT can provide details on every aspect of manufacturing assets involved in the process while helping make adjustments in the operations to perform the optimization of these assets. A possibility also exists in the form that Industrial IoT can potentially introduce new products as also services linked up with Industrial IoT.

Reliability of equipment in a plant is more important than ever, as some run nearly round the clock. “Machines have failures, and some will be due to breakdowns brought about through wear and tear,” says Struth of Bosch. He says, “If you set up a condition monitoring system, again paired with a digital twin, you can make predictive maintenance strategies.” With Industrial IoT fixing failed equipment after it happens can be the past. Industrial IoT with inbuilt sensors and devices can predict the possibility of when equipment fails to give a chance beforehand to fix when the problem is small to avoid the occurrence of the bigger problem. Thus, the predictive maintenance becomes in thing to reckon with Industrial IoT. Not only that, the business can use these connected devices and sensors to track data in real-time, and add new solutions in the process of manufacturing that help improve revenue generation. For start-up Industrial IoT manufacturing, many Industrial IoT App companies can help upgrade their manufacturing. 

Dynamic Challenges in implementing Industrial IoT


Receiving the timely message from the connected device, and the time it takes to traverse the message is critical in handling the machinery. The devices may be located miles apart from the asset sometimes, in which case, the communication with them is most crucial in utilizing the Industrial IoT potential. Besides, the Industrial IoT needs expansion and upgrading in the coming years as the Industrial IoT is evolving rapidly with new developments. Therefore, the smart manufacturing needs to build their Industrial IoT platform with flexible hardware and software capable of adapting to the changing Industrial IoT technological developments. The Industrial IoT faces many unique challenges. For instance, an IoT equipped manufacturing unit that has many connected equipment and machines can talk to each other, and self-diagnose. In the Industrial IoT, it is of prime importance to connect machines and equipment to communicate with each other devoid of human intervention. However, data collected from them needs analysis to improve both efficiency and production and to aim to reduce costs. Finally, with more flexible and intelligent manufacturing, logistics become more optimized and automated lead to greater and sustainable potential manufacturing practices and quality control. 
Smart manufacturing needs to overcome many barriers in implementing Industrial IoT in order to utilize its advantages. IT departments can face many challenges too in managing the complexity of a new system switching to tune with any number of connected devices and with their timely checks. The potential threats for Industrial IoT can be tackled with implementing a solution for IT monitoring of the company’s whole IT and machine created data. The Industrial IoT needs IT monitoring support standards across the network of many sites spread at different places, integration interfaces for different production systems, monitoring user-friendly data with notifications and dashboards, and reporting and extensive alarm and trigger systems.

According to the World Economic Forum Annual Meeting 2017, in spite of the huge potential, Industrial IoT progress can be slow as it involves long investment cycles that can outweigh the innovation desire for Industrial IoT for many manufacturers. However, McKinsey recently estimated Industrial IoT impact to the tune of anywhere from $1.2 to $3.7 trillion in 2025 in potential economic impact within the fully networked manufacturing ecosystems.


The Industrial IoT success, however, depends on the fully functional and dependable network it can create. GE’s Jeff Immelt opined it as “beautiful, desirable and investable” and considered industrial productivity improving just by 1% has potential to add about $10-$15 trillion to worldwide GDP during the next fifteen years.

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