How the Industrial Internet of Things is revolutionizing machine performance

Dr. Aleksander PoniewierskiBy Dr. Aleksander Poniewierski, Partner and IoT Leader, EY.

As consumers, we see the internet of things (IoT) as something that makes our lives easier. The millions of sensors that gather trillions of bytes of data chart our behaviors, measure our activity, and connect us to ourselves and others in ways we could never have imagined only a few years ago.

Now, companies are jumping on the bandwagon, using IoT for more industrial purposes. By attaching sensors to the trillions of machines in millions of factories of all sizes, and then analyzing the captured data, companies could improve efficiency and equipment uptime, and significantly enhance machine performance. Manufacturing and industrial companies are also finding that they could take advantage of the Industrial Internet of Things (IIoT) in the way consumer companies do: by using the data to assess client behaviors, measure satisfaction, and develop new products and services to maximize revenue. And those companies are looking to their CIOs to gain the most of IIOT, find the right provider and assess the risk when implementing it.

IIoT can help provide quick wins without a crippling up-front investment

For many industrial companies, investing in their own IIoT infrastructure can be cost prohibitive. Luckily, industrial machine manufacturing giants such as GE, as well as IT firms such as SAP and Microsoft, are investing heavily into this new infrastructure. They are building connected cloud-based platforms and providing services that can help manage, analyze and store the data that a company’s machine sensors collect.

Working together, this model provides a win-win solution for both the client and the managed service provider. Clients pay for usage. There’s no up-front investment in systems or infrastructure, and they are able to achieve tangible benefits in relatively short periods of time. The advantage for the managed service provider is the ability to collect and aggregate the petabytes of data they gather from their clients, conduct their own analyses and provide valuable insights based not only on their own data, but that from across industries and geographies.

What organizations look for in an IIoT managed services provider

Given the number of high-profile, well-regarded IIoT managed service providers now in the market, the question industrial manufacturers looking to take advantage of IIoT should be asking is: how do I know which vendor to choose?

In the consumer world, the evaluation process can be based on a number of features. Want a new car? Shoppers can compare price, consumer safety reports, luxury add-ons and any other criteria that are important to them as an individual. With IIoT vendors, they’re all offering one main feature: to connect industrial machines, and to manage and store the data they provide. Often, prices among managed service providers are similar as well.

So, where does the differentiated value lie? There are three areas that companies are considering when choosing the right managed services provider:

  1. Applications and intellectual property (IP): One key differentiator is in the IP and apps that a vendor offers, much the way it is when choosing a smart phone. Many of the handsets and embedded features are similar, and the prices comparable. Even the cloud storage options are on par. Where smart phone providers diverge is in the available apps.Similarly, when it comes to IIoT vendors, companies need to understand the cloud platform they are offering, as well as the calculations, analytics capabilities, knowledge repositories and IP they have available in their app stores.
  2. Strategic alignment: Vendor technology and alignment to a client’s business strategy is important today, but it will become absolutely critical in the future as vendors devise niche products and services for different industries and market segments. For example, vendors such as Nokia want to be the platform of choice for smart cities. GE, on the other hand, wants to capture the industrial manufacturing market. However, unlike 20 years ago when, following a three-year implementation period, there would have been no new options, by the time a company has finished implementing an IIoT platform today, it could find that there are 5 or 10 other options available that may now be more suitable to its needs. Because technology, particularly IIoT, is moving so quickly, it’s really important that companies have a deep understanding of not only the existing features, but also what a vendor’s innovation plans are over the next months and years.
  3. Security: IIoT offers some huge opportunities for organizations in helping to reduce costs, improve operational efficiency and maximize revenues. But it also brings with it a lot of new threats. Cyber threats are the obvious consideration. Industrial machinery used to be considered relatively safe from cyber attacks because it wasn’t connected to the internet. Now, with everything connected, hackers can gain access to anything, anywhere. The less obvious risk is around IP protection and privacy. Companies also need to be aware of both the regulatory and legal implications associated with gathering, storing and managing personally identifiable information. Companies may not have to spend money investing in IIoT, but they do have to invest heavily in protecting their assets once they are connected.

IIoT offers a world of opportunity … but be mindful of the risks

The fourth industrial revolution is here, and it’s exciting. IIoT offers a whole new world of opportunities for organizations that can help to boost bottom lines and accelerate performance — provided they are mindful of the risks.

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