Holding tremendous potential to transform the industry, the Internet of Things (IoT) is definitely a trend to watch in manufacturing. However, while many manufacturers—especially those in the mid-market—recognize the IoT will impact their manufacturing operations sometime in the future, at present they aren’t sure exactly to what extent or when this will occur.
This begs the question: If we define IoT as the digital connection of manufacturing resources, applications and analytics, what should manufacturers be doing right now to prepare for its eventual impact?
First of all, preparation is key; one research firm estimates that IoT in manufacturing is estimated to grow from $4.11 billion in 2015 to $13.49 billion by 2020. This includes enabling systems for real-time insights to allow for greater quality and productivity and less waste, greater responsiveness and agility, improved customer service support, and adaptability to changing needs.
The manufacturing industry is already well prepared for this. For instance, machines on the shop floor already include sensors that provide real-time data to floor managers and the operations team on performance levels. IoT can also be seen in the supply chain through inventory systems that instantly notify suppliers when products need to be stocked.
IoT-related applications will reach every corner of the business and beyond. The tremendous volume of data that will be generated, as well as insights from this data, will be more dynamic and more instant. Everyone’s expectations of technology and responsiveness will rise accordingly, setting new standards for communication and collaboration.
As part of this transformation, manufacturers are confronted with an overwhelming volume of data that operators need to convert into actionable intelligence. For this to happen, IoT data will be gathered and disseminated by a stream processing application. As such, a manufacturer’s enterprise resource planning (ERP) system must have the ability to integrate with the stream processing application to allow for specific, filtered data to be passed to the system, thereby allowing the ERP platform to make better decisions. Manufacturers should move now to ensure their ERP platform is future-ready to address these coming IoT demands.
Today’s next-generation ERP solutions leverage new technologies to bring information to those who need it, at the moment they need it, in a form that they can use, and in a way that they can act upon immediately, anywhere. With these capabilities, the value to business comes from increasing the reach of ERP, to every part of an organization—making it as usable on the shop floor as it is in the boardroom.
ERP, as manufacturers know, will form the core of the IoT generation of technology application. What will differ from ERP use in the past will be in how the ERP platform interacts with the new world around it. It will sit more quietly in the background and be focused on managing and monitoring the detailed transaction flows that are the lifeblood of every organization.
The challenge every manufacturer faces is preparing for the IoT future and putting in place the right ERP framework that can address the collaboration and responsiveness needed as new and emerging technologies shape the shop floor. This is the first and critical step to IoT readiness.
The future may not be here, but it is coming. There’s no greater time than the present for savvy manufacturers to put the right data decisioning framework in place to prepare for the IoT future.