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“What Is Your IIoT Strategy?” Is the Wrong Question

Industrial Internet of Things (IIoT)
August 20, 2018

Manufacturers need to do more! Competitors are doing more--and perhaps at a lower cost. Customers expect more--and may demand a discount assuming that you're continuously improving.

The recent technology trends seem to miss the fact that it’s your business strategy that's the thing. Not technology for technology sake. 

Are you targeting growth? 

For example, with the current, rapidly growing economy, manufacturers who want to grow can target the increasing demand for capacity. Of course, adding plants and hiring additional people carries some risk should the economy turn around into a down cycle as has happened many times before. Can you leverage technology to find additional growth opportunities within your existing business landscape without buying or building a new plant?

Is your strategy to increase productivity to do more with what you already have? 

A lean manufacturing strategy can enable you to make better use of the resources you already have at your disposal. Decades of lean thinking focused at continuous improvement have made it clear that there is always waste to be eliminated and often, the effort uncovers hidden value that goes right to the bottom line. The Industrial Internet of things (IIoT) may be taking all the air out of the room when it comes to technology, but at its core, it represents a way to leverage valuable data coming from all your shop floor “things” that can be used to uncover insights that lead to value where no one thought to look before.

Take the most common IIoT use case, for example: predictive maintenance. By monitoring production equipment with sensors, manufacturers can spot performance anomalies that warn of an impending failure. This allows production teams to reschedule jobs and service the equipment before it fails, avoiding job disruption that would result in late shipments and potential penalties. In 2018, IndustryWeek polled the winners of their Best Plants awards and found that unplanned downtime was the cause of 20 percent of all maintenance activities, on average, for the prior five years. And that is for the “best” plants! That’s a significant amount of disruption that could have been eliminated by predicting those failures ahead of time.

For any manufacturer who embarks on a lean journey, there is always a bubble of low-hanging fruit that can be improved right away, and often with significant financial impact. Of course, there is a natural trend toward diminishing returns as hidden wastes become harder to find. With the IIoT, there is a trend toward monitoring anything and everything, and with the right data, in the right context, with the right analytics, humans will be able to identify those improvement opportunities coming from unexpected places. 

Is increasing transparency and visibility to production your business strategy? 

The simple barcode label and its cousin, the RFID tag, have been used for decades to record the comings and goings of inventory. Where most manufacturers miss a golden opportunity is that they don’t use the data to track these goods more rigorously. Plex customers use barcode labels and scanners to record everything that moves, gets produced, inspected, and shipped—following the “no action without a transaction” mantra—creating a traceability trail from door-to-door. The data about where something is in the system not only eliminates the waste of having to go find something, but it provides a valuable digital paper trail to support the whole business. In moments, a customer inquiry can be satisfied. An audit can be completed in hours instead of days, reducing the disruption to the business. And knowing what materials you have in work-in-progress eliminates uncertainty about your inventory position and allows you to reduce your excess inventory and the associated carrying costs. Plex customers tell us that they have been able to expand their production capacity simply by eliminating holding areas of excess inventory that would otherwise be piled up on the floor.

So rather than asking yourself, “What is my IIoT strategy?” You can ask instead, “What is our business strategy? And how can we harvest the data from our operations to do more with what we have?” 

I promise that by digging in a little deeper, you’ll discover that there’s value to be gleaned from operational data to make improvements, even if they emerge from unexpected places.

About the Author

Stu Johnson Director of Product Marketing, Plex Systems

Stu Johnson served as Director of Product Marketing of Plex Systems from June 2014 to March 2020.