IoT in manufacturing: The digital train has left the station

Back 100 years ago, the manufacturing industry was significantly transformed by the invention of the assembly line. Henry Ford invested in the assembly line concept by installing conveyor belts that enabled the plant to produce a Model T car in just 93 minutes, instead of what was 12 hours. The assembly line concept was quickly adopted by other manufacturers, and the technology forever changed the way manufacturing was done.

Today, we are seeing another transformative shift in manufacturing:  a shift toward digital manufacturing enabled by the Internet of Things. Processes are moving online and to the cloud. Data is being captured for every event, every transaction. Movement of materials and finished goods are being tracked. Customer experience data is being captured from order entry all the way through to end of product life. Machine-to-machine (M2M) communications and cloud-connected smart devices are enabling new processes and business models.

For those manufacturers that have not caught on yet, it is time to get on the train before you get left at the station.

When manufacturers digitize, they are connecting people, processes, products and production machinery. Data collected can be analyzed not only to understand past performance, but to understand what is happening in real time. And more important, predictive analytics can help manufacturers more easily and accurately understand potential future scenarios.

Here are some ways that manufacturers can leverage the IoT:

  • Production:   By embedding sensors and data collection throughout the factory building, all materials and machines, and all production processes, manufacturers can see benefits in areas such as production output, product quality, workforce safety, predictive maintenance, energy management, asset optimization and cost management.
  • Supply chains:  IoT can be applied to supply chains and logistics to increase visibility and coordination across supply chain partners. Benefits include tracking raw materials, finished goods and other assets (containers, vehicles, etc.) to optimize supply chain execution and improve business planning.
  • Products:  Embedding IoT capability into products to improve performance and customer experience. Benefits include capturing detailed information on products in the field, access to remote diagnostics, and the ability to perform remote maintenance and perhaps even remote operations. As an example:  Pratt & Whitney is using IBM IoT solutions, including predictive analytics, to more accurately and proactively monitor the health of more than 4,000 commercial engines.
  • Intelligence:  The big data collected from all the transactions can be fed into analytics tools and cognitive systems that enable knowledge workers and decision makers to analyze and compare performance, build smarter algorithms and drive process improvements based on lessons learned. Small manufacturers can build centralized intelligence systems and mobile dashboards for individual factories, and larger industrial enterprises can do the same for multiple factories.

If you are a manufacturer and have not yet developed an IoT strategy for your company, here are a few steps to get you going.

  • Think security. The cost of data breaches is increasing, your security strategy should not be an afterthought. Design security into your IoT strategy from the start.
  • Implement cloud computing and big data & analytics. These are enabling technologies that must be in place to optimize any Internet of Things strategy. Work hard to get these right.
  • Build digital skills. Invest in technical and business leaders that understand the importance of a data-driven culture and the analytical systems required to provide insights into data captured. Educate the workforce about the digital manufacturing, the Internet of Things and data/analytics.
  • Develop a Smarter Factory IoT strategy. Think of the entire factory as a potential giant nervous system. Where would the “nerve endings” be? Are there any building assets, machines or processes that are not being monitored for performance? Develop a plan for putting sensors throughout all elements of the factory to help you collect the data needed to fully understand everything that is happening.
  • Develop a Product IoT strategy. Reimagine your existing products for the digital world. Determine ways to embed capability to connect your products to the Internet and send/receive data. Explore the idea of value-added services resulting from having your products connected to the Internet.
  • Develop a Supply Chain IoT strategy. Develop a long-range IoT strategy for supply chain logistics. Involve your supply chain partners, both upstream and downstream in efforts to digitize all levels of the supply chain ecosystem.
  • Pilot, learn, pilot again. Embrace the idea of agile development to quickly pilot your IoT strategy in various areas of your manufacturing operations. Learn from your failures and innovate.


So, this is your call to action to get started on your digital journey. Manufacturers that embrace the Internet of Things can become digital manufacturers. They’ll be more efficient, more productive and smarter than older plants and factories.  In a marketplace where change is happening at a rapid pace, those that don’t embrace the Internet of Things may not survive. So don’t get left at the old legacy manufacturing station. Jump on the digital IoT train!

To learn more about how the IoT is impacting other industries, browse our full industry series.

 Additional reading

Transforming Manufacturing with the Internet of Things

The Internet of Things: what it means for manufacturing

The Economy of Things

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  1. […] "Today, we are seeing another transformative shift in manufacturing: a shift toward digital manufacturing enabled by the Internet of Things. Processes are moving online and to the cloud. Data is being captured for every event, every transaction. Movement of materials and finished goods are being tracked. Learn more now!"  […]