Manufacturers who fully grasp the potential IoT can not only streamline production but also create new revenue streams and business models.
The Internet of Things (IoT) is changing industrial manufacturing
Manufacturers are often focused on the ability to reduce costs and optimize production with industrial IoT in the modern age.
IoT offers manufacturers a wider range of possibilities to create connected products and develop service-based business models around them.
Manufacturers must prepare for digital transformation using an IoT strategy.
Businesses will be able to move beyond manufacturing and into vertical business models if they understand the true potential of information.
The manufacturing industry’s key trends
- Implementing IoT projects is difficult because of a lack of resources and knowledge.
- To ensure product longevity and customer service excellence, end-customers will be more likely to choose connected products.
- In order to keep their core products in focus, manufacturers will outsource complex tasks to IoT specialists.
- Manufacturers will be able to more efficiently and effectively collect, choose, and integrate data.
- To achieve servization , more manufacturers will be using IoT.
- Many manufacturers will be affected by the ecosystem approach to their value chain.
Connecting to the Manufacturing Process
The most important benefit of making factories smarter using sensors and connectivity technology is the reduced total cost of ownership (TCO). Most commonly, savings are realized through more efficient maintenance and servicing.
Service can be provided based on the feedback received from connected devices and machines.
Combining usage data with predictive analytics allows machine owners to predict when certain components will require service or replacement. This allows for easier management of spare parts and helps improve uptime.
The next step in smarter Manufacturing is to use the information from connected devices for further optimization and prevention of downtime.
Automation allows devices to work in unison even when they are separated by long distances. Flexible production methods that are easily scaleable and can quickly respond to consumer demands allow for this flexibility.
IoT for OEMs Transforming Business Models
After leaving the production line connected devices in OEM machines can give manufacturers a detailed insight into the product’s usage and performance. However, this usage data is often difficult to access and even more difficult to leverage.
Connected devices can be accessed almost immediately, thanks to the increasing speed and coverage of internet connectivity. The IoT market has grown and there are established frameworks as well as open APIs that allow for practical applications of the data from connected devices. Real usage data is now available to help product development go in new directions.
Building End User Relationships
The OEM manufacturer had to close the deal when the product was shipped to resellers or distributors. Manufacturers have the ability to build long-lasting relationships with end-consumers today through add-ons and aftermarket services. Vertical business models can be made possible by companies.
A connected product gives companies the chance to directly connect to customers and build deeper, longer-lasting consumer relationships.
Businesses can differentiate themselves in different markets by using a connected product. Manufacturers have the opportunity to offer product-as-a service.
Manufacturers have the opportunity to generate new revenue with a product-as a-service model. Instead of asking customers to invest upfront, manufacturers can charge customers by the usage or the delivered value. This creates low barriers to consumer adoption and allows for rapid rollout of multiple products to determine which one works best.