How IoT Is Fueling Industrial Digitalization

The Internet of Things — or IoT — is a trend that’s changing how we live, work and play. The IoT is a term used to cover any ‘thing’ that is connected to the internet, turning everyday objects into smart ones. Matthew Evans, the IoT Program Head at techUK defines the IoT as being “made up of devices — from simple sensors to smartphones and wearables — connected together”.

By 2020, experts predict that the world will have more than 50 billion connected devices — and the world of industry is right at the forefront of this new era.

One recent study estimates that around 35% of manufacturers in the United States are already using some kind of collected data from smart sensors in their factories, logistics and/or final products. For instance, a company called Concrete Sensors has created a device to insert into concrete to provide information on the status of the material’s condition.

Digital transformation in industry

IFS, an enterprise software developer, recently issued a report on digital transformation in industry. For the report, digital transformation is defined as the idea that as we use more and more digital technologies in our lives, those technologies change the way we live our lives and run our businesses.

The report surveyed 200 individuals at North American industrial companies who make decisions about IoT purchases. The report found that the IoT lies right at the heart of the process of digital transformation in industrial companies. The report looked at both digital transformation leaders and ‘laggards’ — the former were “almost three times as likely to use IoT data for corporate business intelligence, or to monitor performance against service-level agreements” than the latter. They were also more than four times as likely to have created a way to access IoT data in enterprise asset management software, twice as likely to have access to IoT data in high-value asset performance management software, and almost twice as likely to be able to be able to use IoT data in Enterprise Resource Planning.

As well as these findings, the report also made three prioritised recommendations for an IoT decision-maker wishing to move their business from a laggard to a leadership position.

The importance of people

The first is people. According to Dianne Denison (of Denison Consulting Group Inc., who specialise in the industrial Internet of Things), “People are the most critical element to deliver the IoT”. For her, a company needs to recruit or train people to create teams that can comfortably work across both operation technology (ie. monitoring manufacturing and industrial components such as valves and pumps), as well as information technology (ie. the processing of data for corporate functions such as accounting and sales). By bringing these two skillsets into the same team, a company has the right building blocks in place to bring IoT into the heart of its business.

With these foundations in place, here comes the second recommended priority: focus on specific projects. One of the main attractions, but also main drawbacks of the IoT, is that it can be applied to almost anything. Instead of trying to tackle too much at once, or figure out the ‘best’ place to start, simply select a solution that helps address an immediate operational or safety issue, or that provides the greatest return on investment.

Security risk and protocals

The third and final recommended priority for a company wishing to up its IoT game is to make sure it has security locked down. The collection and communication of data is a central part of the digital transformation brought about by the IoT of things, and without proper security protocols in place, the risk of hacking and exploitation can be very high. If a company wants to thrive as a result of investing in the technologies of the IoT, then being able to share data beyond its plant floor is absolutely essential.

Unfortunately, that data has a value to people outside of the organisation where it was generated and when it is moved from the factory to the cloud, it becomes vulnerable to attack. For this reason, it’s imperative that businesses build secure systems into their processes and functions from the word go, and recruit or train security experts to stay up to date with any new techniques or opportunities for attack.

The opportunities presented by the internet of things to fuel digital transformation in industry are growing and constantly changing. Indeed, many businesses have been benefiting from digitalisation for years. By hiring or training talent, by focusing on projects instead of principles, and by making extra sure that all data created is stored, transferred and used securely, it’s not too late for the rest of the sector to catch up and enjoy what this new era has to offer.