Connect the physical with the digital

Leaders say, don’t let culture impede technology progress with the Industrial Internet of Things (IIoT).

By Dr. Keshab Panda, L&T Technology Services November 10, 2017

Bridging the divide between the physical and the digital worlds, the Industrial Internet of Things (IIoT) transforms how companies function and how work gets done, based on gains in sensor and microcontroller technology, connectivity, and analytics. These emerging technologies are also conceptualized as Industrie 4.0.

Businesses focus on operational excellence to streamline and tighten production processes. Six Sigma techniques support these efforts. IIoT gives these companies an opportunity to go beyond Six Sigma, fool-proofing many activities and processes related to operational efficiency.

These trends see support in a survey from L&T Technology Services and ARC Advisory Group conducted at this year’s ARC Forum. Half the survey respondents were with large corporations having more than $10 billion in revenue. According to the survey results, 57% of business leaders and organizations embrace IIoT for operations-related work. Key focus areas for IIoT are to enable augmented operations, human-robot collaboration, advanced digital-product development, data-driven control of operations, and predictive maintenance.

Early adopter feedback shows that the transition to an IIoT ecosystem depends on employee initiative. The survey also highlights that 42% of business leaders feel that organizational culture acts as an impediment to IIoT adoption. Capital expenditure concerns are also prevalent.

While about 40% of organizations said their companies are at the pilot stage of evaluating IIoT, 31% said they’re already in discussions with partners and ready for gains on first-mover advantage. Predictive analytics and Integrated IIoT are key those adopting IIoT. 

Given the need

Let’s take a step back to discuss what really makes up an IIoT architecture. In IIoT systems, industrial assets and operations technology (OT) such as materials, machines, and plant control systems, interconnect with information systems and technology (IT). Also connected are users, along with the enterprise business processes and technology (BT). Once connectivity and system data flow between OT-IT and BT is accomplished, data can be aggregated and analytics applied.

As insights are gained, smart decision-making leads to intelligent industrial-operation and business models. While conventional IIoT frameworks are available, a scalable and long-term approach integrates IT, OT, and BT. While IT deals with increasingly large databases, OT is about physical devices and processes, and BT is about business software applications.

Classifying the technologies in this fashion can help uncover challenges inherent in the status quo. IIoT technologies can then allow companies to autonomously manage production, integrate customer data with machine data, and harness the power of machine learning. This in turn can positively influence operational efficiency and fuel innovation, while improving quality, safety, and productivity. Like the remote management systems applied in largescale computing and telecommunication domains, IIoT enables management of the engineering value chain, from the comfort of a centralized location.

Two typical characteristics of any IIoT-based system include information processing on a 24×7 basis and real-time constraints imposed by the environment.

A comprehensive IIoT architecture might include sensors, for detecting events or changes; edge gateways that aggregate and filter sensor data; IIoT cloud-enabled platforms, including smart-signal aggregators and modelling algorithms; Big Data analytics, including machine learning, artificial intelligence, augmented reality, data store, and security. The entire system is meant to run as a managed service.

In addition, technology firms add IIoT value by offering managed engineering services as a key building block of the IIoT system. Managed services comprise round-the-clock remote monitoring, predictive maintenance using data analytics, and value engineering. Thus, a new kind of build-operate-manage model will increasingly become the paradigm for technology providers. 

Case study examples

Business-process management and enterprise-resources planning integrate systems and processes to a degree. The comprehensive structure enabled by IIoT takes further steps. An IIoT-enabled framework can integrate processes starting from the product-development stage through manufacturing to supply chains. Possible capabilities include data-driven inventory, remote asset testing and inspection, data-driven quality control, remote service, additive parts manufacturing, augmented operations, human-robot collaboration, and advanced digital-product development.

While IIoT is in the early stages of adoption, inspirational narratives abound. For instance, a global construction company faced critical business challenges managing field assets and equipment. This was addressed using IIoT technologies that in turn enabled development of a remote asset performance management framework. The framework covers 30,000 assets across 500 asset types. It delivered an estimated 12% improvement in asset utilization. On-time asset availability will likely lower overall costs as well.

Services supporting the solution implementation included sensor identification, gateway selection, sensor-gateway commissioning, and on-boarding. Such an IIoT system generates six gigabytes of data per day, deriving data intelligence from about 2,500 nodes.

In another instance, a consumer-goods manufacturer addressed the operational disruptions caused by frequent compressor failures in its manufacturing plants using IIoT technologies. The system used predictive analytics to proactively estimate time to failure, using anomaly indicators including temperature, current, vibration, and other parameters. The model works at more than 70% inaccuracy and is estimated to result in annual savings of about $500,000.

The impact to come

According to a report by McKinsey & Co. Inc, IIoT will have a potential economic impact of up to $6.2 trillion by 2025. McKinsey lists IIoT as one of the key technologies capable of economic transformation. The future will see continuing transformation of industry on a global scale.

IIoT platforms will be a critical success factor for goods makers and services providers. Industries that leverage IIoT to integrate data, machines, and people will see impacts on productivity, efficiency, and operations. IIoT can be a life preserver in increasingly stormy seas, providing an intelligent technology framework, with benefits for a company, its partners, and customers.

Dr. Keshab Panda is CEO and managing director, L&T Technology Services. L&T Technology Services is a CFE Media content partner.