The Evolution Of IIoT: Manufacturing’s Next Act

Wednesday, September 20th, 2017

The Industrial Internet Of Things (IIoT) is all the rave of industry players today. For Schneider Electric, this is more an evolution than a revolution, and one that can improve businesses and operations, especially here in ‘Factory Asia’. By Tommy Leong, President, East Asia & Japan, Schneider Electric

The Industrial Internet of Things (IIoT) is often hailed as a revolution that is changing the face of the industry in a profound manner. In reality, IIoT is more an evolution, a coming together of the technologies and functionalities developed by visionary automation suppliers more than 15 years ago.

What Exactly Is IIoT?

IIoT is a world where smart connected assets (the things) operate as part of a larger system or system of systems that make up the smart manufacturing enterprise. The ‘things’ possess varying levels of intelligent functionality, ranging from simple sensing and actuating, to control, optimisation and full autonomous operation.

They are linked together based on open and standard Internet and cloud technologies, which allow ‘big data’ to be processed with new, advanced analytics tools and for mobile technologies to drive greater business value. This, in turn, enables improvements to efficiency and profitability, increased cyber security and innovation, and better management of safety, as well as performance with reduced CO2 emissions impact.

IIoT is more than just a flashy catchphrase. It is not new for many of the industry players really. For example, Schneider Electric promoted the use of Ethernet on the plant floor early on, right down to the sensor, and the use of web IP technologies to converge Information Technology (IT) systems with Operating Technology (OT) systems.

In fact, our first digital distributed control system—which, by its very nature is digital and connected—was launched in 1987, four years before the launch of the World Wide Web.

With two decades of innovation around digitisation and connectivity, IIoT is—at least to Schneider Electric—not a revolution, but an evolution; and this evolution is now starting to see the full end-to-end integration and complete solutions for automation and control systems.

But we recognise that it may well take another 15 years to realise the full and far reaching potential of IIoT, and the changes to the industry, especially in “Factory Asia” which today makes almost half the world’s goods.

It is not surprising that Asia attracted manufacturing giants from across the world. With low wages and low production costs, manufacturers clamoured at the opportunity to increase their profit margins.

However, this is no longer the case. The average pay in Asia has more than doubled between 1999 and 2013, according to the 2014/2015 Global Wage Database by the International Labour Organisation.

As such, manufacturers can no longer rely on cheap wages to maintain their profits. Labour markets are also shrinking, making it difficult to maintain a stable workforce.

Given this backdrop, coupled with the ever-increasing consumer expectations, how can Asian manufacturers leverage on IIoT to ensure that the future of ‘Factory Asia’ remains bright?

Optimising Efficiency

In manufacturing, optimising efficiency is paramount to maximising profits. IIoT can deliver improved traceability for better supply chain efficiency, which brings about faster production and lower costs.

Additionally, when today’s existing Big Data technologies for storage and analytics are combined with machine-to- machine communication, smart machines are able to consistently capture and communicate data better and more efficiently, helping businesses crunch the data to produce real-time operational intelligence. This makes decision making easier and ‘smarter’ for businesses.

For example, by using sensors and embedded intelligence, smart machines can monitor the operating temperature in their own key components to track any abnormalities or deviations from an established baseline.

Any deviations will be identified by the smart machine and communicated to the machine operator in real-time. This enables the manufacturing company to proactively address undesired behaviour as predictive maintenance before crippling system failures can develop, which would otherwise lead to plant downtime and lost production revenue.

An example of smart machines in operation is in F&N Dairies in Thailand. Before the installation of Schneider Electric’s Wonderware Software Solutions, an HMI (human machine interface) industrial software solution, the operators had to manually trace the information in the archived, paper based operations sheets when quality parameter deviations were detected. This took countless hours of manpower time and effort to trace the root cause of the problem.

With the integration of the software solution to provide vital data on production processes as well as track and trace, the Thai dairy company was able to have comprehensive control of manufacturing operations to ensure product quality and control, and reduce the time it took to track quality parameter deviations from four hours to one minute, boosting production to three million cans a day.

By switching from a manual to an automated process, the company also increased its operational efficiencies, reduced production errors and quality losses, as well as increased product yields.

Productivity also rose through rapid inventory turns, and they also saw reduced production lead times and faster new product introductions. In all, this installation reaped return-of-investment within one year.

Enhancing Flexibility

Manufacturers need flexible manufacturing lines that can quickly adapt to rapidly changing customer demands. This calls for flexible machines that are able to run a multitude of product types, with the ultimate goal of profitable production at reduced lot sizes, enabling a complex mixture of products to be produced on-demand.

Manufacturers across various segments also need industrial technologies to converge so that they are able to better manage their systems, processes, and challenges.

With this in mind, any new smart machines will need to be compatible with the existing installations or machinery from multiple Original Equipment Manufacturers (OEMs), and new upgrades will need to be installed within a short timeframe. Simply put, time is money.

Iiot Beyond Automation

Many see the benefits of IIoT as connected solely to industrial automation. Although industrial automation is an important aspect of IIoT, there are major cost savings that manufacturers can reap through energy efficiency in smart machines and factories too.

Every machine or plant has an energy profile. With IIoT, manufacturers now have the ability to know how much energy is being consumed on the shop floor in real-time, and sustainability plans can now be built on accurate consumption data so that measureable improvements can be executed.

With industry solution providers such as Schneider Electric that has an integrated architecture and platform with complete end-to-end cybersecurity, manufacturers can do just that; these provide a clear control platform to facilitate local and real-time control, and has a suite of software, analytics, and apps enabling the control and collection of data for analysis.

In some cases, manufacturers can even report up to 30 percent savings in capital expenditure (capex) and operating expenditure (opex).

IIoT is here to stay. Asian manufacturers have the opportunity to lead this charge to gain increased efficiency, lower costs, and an improved competitive position, and ultimately strengthen Asia’s hold on manufacturing.