How Does IoT Reduce Manufacturing Risk?

The manufacturing industry is currently experiencing an increasing influence of the Internet of Things (IoT), aka Industry 4.0. The IoT has a positive impact on both production and business management processes.

We have already discussed the big question of the differences between M2M and IoT, and in this article, we will go through the ways the IoT can help manufacturers reduce risks.

Industrial IoT Statistics

The Internet of Things in manufacturing can become the biggest driving force behind growth and productivity. According to Accenture, the Industrial Internet of Things (IIoT) could add $14.2 trillion to the global economy by 2030.

The diagram by Statista depicts the number of industrial robots sold worldwide from 2004 to 2017. You can see a huge leap from 97 to 387 thousand units, proving that manufacturing is one of the core areas for the implementation of IoT devices and machines.

Worldwide sales of industrial robots from 2004 to 2017 (in 1,000 units)


Source: Statista

PwC has published a study of the industrial IoT state in Germany, the results of which show that 91% of industrial companies are investing in digital factories, but only 6% consider their factories to be fully digitized. In general, manufacturers are eager to implement IoT systems in the operations, expecting that technology will cut costs, increase productivity and reveal new revenue opportunities.

How Does IoT Revolutionize Manufacturing?

Many companies are concerned with producing goods that meet customer demands, which is why they incorporate IoT into their manufacturing processes. This technology relies on smart processes that enable intelligent analysis, conduct and response.

IoT-connected devices integrate employees, facilities, equipment and databases into comprehensive networks as they collect data from all endpoints and send them to workers, plant managers, software systems and the supply chain. Also, they make the most use of the company’s know-how and business objectives, enabling their self-reliant operations.

The Internet of Things reduces manufacturing risks and revolutionizes the face of the manufacturing industry, as it replaces humans in numerous processes and streamlines the production by performing the following functions:

  • Advanced analysis. The integration of IoT-connected devices and relevant software solutions enables powerful analytics to predict failures and optimize maintenance. Sensors monitor networks and integral devices, measure performance indexes, assess operation features, alert users about malfunctions and react to occurrences that are beyond specified values. The advanced analysis allows to dramatically improve equipment efficiency, performance and the uptime, as deficiencies do not go unnoticed.
  • Inventory level monitoring. In maintenance, repair and operations environments, IoT-connected devices monitor distributed inventory and tank fluid levels, the condition of wear parts and production rates, which enhances the communication between manufacturers and suppliers. Also, proper monitoring enables quick and effort-efficient identification of issues that adversely impact product quality or time-to-market.
  • Remote process monitoring. Employees can remotely collect information on production processes, check whether they or their outcome meet specific regulations and requirements.
  • Abnormality reporting. Human participation is no longer required to identify possible aberrations in equipment performance and condition: IoT-connected machines alert users about their bad conditions, leaving employees to only take remediation steps.
  • Virtual equipment management. Automated devices allow employees to fix many of performance aberrations via virtual networks, without their physical presence, thus streamlining equipment management and monitoring. Also, virtual equipment monitoring allows employees to be aware of device location; in particular, of the location of movable assets.
  • Machine-to-analytics data stream automation. Analytical solutions process, parse and convert raw data into insightful information, in turn improving analytics and eliminating the need for the staff to perform it on their own.
  • Remote equipment configuration. Employees can tune and configure devices remotely, significantly saving time and effort.
  • Well-timed equipment maintenance. Employees who service equipment can notice aberrations in the machine performance in advance and fix them before any damage is done. This is especially important for machines that perform the most critical functions.

Four Benefits of the IoT for Manufacturers

The IoT technology can help manufacturers avoid mistakes, enhance operational efficiency and adapt to new market conditions and emerging technologies. Also, it relies on M2M communications to capture data from every link in the chain for uninterrupted manufacturing and results in high productivity, enabling tighter control over the manufacturing process.

We’ve compiled a list of the core benefits of the IoT for manufacturers.


Cost Efficiency

The largest cost items for manufacturing firms are energy, materials and losses due to the downtime. Process automation is the hallmark of the IoT that results in considerable cost efficiency.

The IoT-connected devices monitor equipment, analyze collected data and react to changes in the production process, such as material shortages, equipment malfunction, inefficient energy consumption and more, and allow to properly and quickly fix the problems. The smart system can redistribute resources without human involvement to optimize product supply or alert users of performance abnormalities so that engineers can fix them in a timely manner and prevent the outage.

Improved Decision-Making

Resource management and optimization that involves both humans and machines require comprehensive data. In IoT, sensors are responsible for data gathering as they connect to robust networks and provide accurate real-time information through supply chains. Fast information flow throughout the manufacturing facility enables the ongoing creation of dashboard metrics that help broadcast results and facilitate decision-making.

When using IoT technology, managers are equipped with accurate insights and are continuously aware of the performance of systems and devices, which results in faster and better-informed decisions.

Quick Time-to-Market

The IoT empowers direct communication among network components, significantly improving production time. This automates the beginning of the process, as well as the detection and addressing of possible issues. Also, real-time data access enables faster decision-making and contributes to improved responses to market fluctuations. That is why new products quickly move from the concept stage to their commercialization, contributing to significant time savings.

High Customer Satisfaction

Excellent quality is a decisive factor that determines the behavior of potential customers and helps turn prospects into clients and enhance their loyalty. The IoT provides predictive maintenance tools together with statistical evaluations that help innovate, plan, design, build, operate and maintain industrial facilities, resulting in qualified goods.

These tools maximize plant reliability and help eliminate failures before they occur. That is why detecting possible aberrations in product attributes and quality in a timely manner prevents the commercial distribution of defective goods. Also, the IoT minimizes human participation in the manufacturing processes, therefore reducing the human factor and improving the reliability and quality of products.

Four Risks of the IoT in Manufacturing

With such significant benefits to be realized, why are some manufacturers still holding back the implementation of a comprehensive plan to connect the entire floor — or even the entire business?

Connected solutions generate massive amounts of data that must be handled with care. While this information is possibly the greatest benefit of the IoT technology evolution, it is also the greatest challenge.

What are the main risks of introducing IoT into manufacturing processes?  

1. The Provision of Networking Capabilities

Smart manufacturing requires standardized networks to facilitate device communication across production and business environments. It also enables collaboration with suppliers and customers. Smart manufacturing installations connect with numerous networked sensors through the enterprise and the entire environment. They collect data from equipment installed on customer sites, those contributed by suppliers, and those produced during the manufacturing process. The data is then parsed and analyzed.

Powerful networking significantly streamlines and enhances decision-making, which is why manufacturers should ensure smooth interaction among their networked devices. If you don’t provide appropriate networks for IoT devices, you risk failing.

2. Thought-Out Functionality of Software Solutions

IoT is more than just integrating smart devices into a single network. Its value is to streamline manufacturing processes and improve efficiency via the networking and provision of accurate data. In the most effective cases, managing entities work with all aspects of the manufacturing and supply chain to ensure that the customer requirements always determine the business objectives.

When developing IoT-based software for the manufacturing industry, companies should carefully define software functionality and capabilities. IoT is not the overall goal; it is just a method to enhance business efficiency. Manufacturers should have a broader perspective and understand that their actions should not be limited to the integration of smart devices and the installation of various sensors.

3. Efficient Data Mining

Efficient data collection, storage, synchronization and use are essential to successful smart manufacturing. In an effective smart manufacturing protocol, data participates in every manufacturing process. The connectedness of sensors, actuators, video cameras, production equipment and other smart devices to the Internet and to comprehensive networks enables data collection from any endpoint.

To provide efficient data mining and use, manufacturers should create robust collection frameworks that are capable of data fusion and knowledge capture, and include sensors and simplified user interfaces. When applying sophisticated software to deliver manufacturing intelligence, companies should provide user-friendly interfaces.

4. Security

Security is a common concern for many businesses that implement smart manufacturing frameworks. Data is transmitted between numerous devices, which requires proper security measures, as it otherwise becomes extremely vulnerable. That is why manufacturers should prioritize security and safety by stipulating efficient protection measures.

Also, a proper manufacturing solution should enable communication with customers and suppliers through secure remote access. This not only allows businesses to benefit from data that they collect from outside of their facilities but can also protect their environments.

Final Thoughts

Smart manufacturing represents a connected network of sensors that collects data from every point within the production process and analyzes it to create smarter decisions and more efficiency in operations.

The true value in a smart manufacturing environment is in how quickly accurate information is available and accessible. That information can in turn resolve issues before they arise. This is why it is important to develop a proper implementation strategy, including the consideration of the IoT manufacturing risks.

SaM Solutions offers a complete range of end-to-end systems and embedded software development services. Our IoT products allow manufacturers to create an environment that brings together data from all aspects of the business. Eventually, they are able to make crucial decisions and ensure the highest quality products are delivered on time and within budget.

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About the author


A copywriter at SaM Solutions, Eugene is fond of writing about innovative technologies and solutions that improve living standards and add value to business operations.

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  • Hi! Thanks for this info! Love your blog!.

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