Industrial Engineering

How the IIoT Can Change Business Models

https://advancedmanufacturing.org/how-the-iiot-can-change-business-models
Manufacturing Engineering Magazine July 2019
By John Bruno

When manufacturers envision the future of the Industrial Internet of Things (IIoT) for their own operations, they’re likely to focus on its potential within the walls of their own factories. And they’re not wrong—from connected machinery to artificial intelligence and machine learning, the IIoT has the potential to supercharge any manufacturing operation.

But with this approach, industry decision makers and their field teams are missing the full potential of sensor technology. Manufacturers can use IIoT technology and the sensors that enable it not only within their factories, but to fundamentally change their business models as well.

One of the areas where manufacturers have historically struggled the most—and can also benefit the most from the IIoT—is customer experience. Here’s how manufacturers can shift their mindsets to leverage modern-day tech and bolster the human side of their business.

It’s nearly impossible for any organization to ensure customers will maintain a consistent experience from seller to seller. Meanwhile, manufacturers selling through a distributor have even less control over the customer experience. If a third party is delayed in responding to a customer’s questions or concerns, the manufacturer only finds out after the fact—after the customer’s quality of experience has degraded. Fortunately, in both scenarios the IIoT can provide manufacturers a clearer picture of product lifecycle without sending one email or picking up the phone.

For example, a manufacturer of people-moving machinery was struggling to maintain the experience users had with its products through third parties. So, for one airport customer, the manufacturer chose to embed sensors in its moving walkways to monitor not only part maintenance and reordering, but also to track walkway traffic to schedule maintenance at an optimal time.

These IIoT upgrades aren’t something a typical airport traveler will be aware of, but they certainly will notice if moving walkways aren’t working. By invisibly improving the end user’s experience, manufacturers ensure they are better serving their distribution network and their customers.

Every manufacturer essentially becomes a software firm once they begin using the IIoT, and they must start thinking as one. That’s because application of the IIoT’s capabilities requires understanding complex data points related to upwards of hundreds of sensors. Leaders in this space not only understand this information themselves, but can also provide an accurate and digestible view of big data to their buyers.

Answers Lead to More Questions

Take the people-moving manufacturer example. The company’s primary value driver was moving walkway uptime. IIoT-enabled sensors support that goal, but how would those sensors transmit the data back to the company—through a wired or wireless network? Every answer leads to another question, and the company needed the data expertise to answer them all.

The biggest barrier to IIoT entry for most manufacturers is making sense of the massive flood of data they’ll suddenly own; all that data is worthless if you don’t know how to use it. Manufacturers need to stop and support accordingly to make sense of this information.

While manufacturers are actually ahead of the IIoT curve due in part to a product-first mindset, a concerted shift toward customer experience will open new revenue streams. By considering areas like maintenance, companies can move beyond product and transform their businesses based on the quality of outcomes—not just the quality of products—all due to the IIoT.