For our recent webinar on IoT for manufacturing, “Intelligent Operations: Keeping Pace with Smart Manufacturing”, we welcomed Colin Masson, Microsoft Global Director for Manufacturing Industrial Solutions, Microsoft Cloud and Enterprise. With over 30 years of experience implementing and selling manufacturing and supply chain software, Colin led the discussion on the Internet of Things, sharing his perspective on the value of IoT for manufacturing and how Microsoft is helping those manufacturers transform the way they do business.
What is IoT for Manufacturing?
In its simplest terms, IoT can be broken down into four components:
- The many “things” connected to the internet
- The connectivity of these things made possible via cloud ERP technology
- The data collected through affordable sensors and chips
- The analytics, the intelligence applied to that data
How prevalent is IoT for manufacturing now, how prevalent will it be in the next one to two years, and what does it hold for the future? The numbers Colin delivered show a thriving adoption of IoT and why it must be part of a manufacturer’s overall production and technology strategy:
- $913 billion marketing opportunity by 2018
- 14 billion connected devices by 2022
- A cumulative GDP impact of $10.6 trillion by 2030
Colin reported that one-third of the $10.6T GDP impact will come from some form of manufacturing. However, manufacturing is not just a market that is changing, business leaders are also conducting operations differently. Industrial manufacturers are reporting a 28% increase in revenue due to IoT initiatives, and 40% of industrial manufacturers are using digital technologies to monitor products sold to customers.
Data and What to Do with It
In essence, IoT for manufacturing is, as Colin stated, “A significant opportunity for manufacturers to change the way they do things.” Yet in many ways, manufacturers have been setting the foundation of IoT for years. Through automation and monitoring OEE using sensors and feeding data into their MRO systems, new cloud and machine learning technology only now increases our ability to monitor, configure and maintain these machines.
The real change is happening beyond the traditional manufacturing value chain, where the customer and the customer experience is increasingly becoming the basis for competition. Because of the way IoT is connecting customers and transforming the customer experience, it is no longer a matter of whether the discrete manufacturers develop an IoT strategy, but instead, what should the IoT strategy be?
Colin shared some data to demonstrate what transformations are being made through the use of data and digital technologies:
- 28.5% average revenue increase from IoT among industrial manufacturing companies
- 40% of industrial manufacturers monitor via digital technologies products sold to customers
- 89% of manufacturing executives believe the customer experience will be the basis of competition starting in 2016
Microsoft’s Investment in IoT for Manufacturing
Microsoft has invested heavily in the security of IoT on Azure, and has worked closely with their partner channel to develop vertical specific solutions around these areas. Colin profiled select Microsoft customers: ThyssenKrupp Elevator, Rockwell Automation, Kuka Robotics, and Lotus Racing. These customers are all leveraging IoT, some on the Azure suite, some also running Microsoft’s new release of Dynamics.
Microsoft’s IoT team has made it easy for any size manufacturer to start their IoT initiatives with pre-configured solutions, such as remote monitoring and predictive maintenance. This is the fundamental functionality of IoT for manufacturing: Being able to monitor smart products already deployed in their field. This flexibility gives you the ability to monitor your own industrial machinery for OEE and lower costs related to expensive maintenance.
Azure IoT Suite allows companies to add its own devices over time and eventually deploy an IoT strategy that allows monitoring of products being sold to customers. IoT also gives you the ability to increase margins by deploying your field service technicians to your customer site only when needed, collect valuable customer data and sentiment, and increase customer experience.
IoT: Not Just For Larger Companies
You don’t have to be a multi-million dollar business to benefit from IoT. According to Colin, thinking about IoT should be a key, foundational consideration as companies both small and large can benefit from blending IoT into their overall enterprise software strategy. A smaller consumer goods manufacturer can use vending machines to understand how consumers feel about their products, while a large, industrial automation manufacturer has the ability to sell a $1 million, multi-sensor machine as Product as a Service with a service level agreement. This is becoming the norm, and is helping companies work with smarter equipment that is easier to reconfigure, to drive an efficient operation and compete at the customer experience level.
You can access this webinar through our On-Demand Webinars page, where you can request access to this and other Ultra webinar events.