Extracting value from industrial IoT using a higher level of thinking
I have discussed before that in order to talk about the value of the Industrial Internet of Things (IIoT) in manufacturing, we need to have a holistic view that includes the Industrial Internet of Things, the Internet of People and the Internet of Services (IIoT/P/S). I was recently asked by a client about the role of IIoT in the context of digital transformation of the enterprise. We concluded that IIoT/P/S needs to be treated as the next level of thinking, which is quickly becoming the new normal for those committed to finding competitive advantage.
And this is why: thinking about becoming a “digital” business is frequently confused with technology and its implementation, but it goes well beyond just technology. Enterprises that think truly digital recognize that the pace of technology advancement has outpaced, for the first time in many decades, the pace of advancement of practices and process improvement. As a result, these enterprises are ready to take a bolder approach at reengineering old processes so they can not only change the way they do business, but also change the products and services that they offer as much as they mature their technology.
Here’s a very simplistic example about how technology can change an old business strategy: think about the Kanban lean production systems, first implemented over 50 years ago. Today, those Kanban systems still run some of the most efficient manufacturing plants in the world. A few years ago, enhancements came with electronic Kanban (e-Kanban). The e-Kanban goes out of the plant to align external vendors and to avoid manual errors, but the specific concept of managing production and inventories via card signals remains the same. Think about how today’s technologies such as 3-D printing, virtual and augmented reality, and predictive algorithms can change the manufacturing landscape. For instance, a smart product or a smart machine can preempt and send corrective inventory and production flow signals to peers or print parts to self-fix before Kanban cycles do their job.
In essence, using new technologies makes it easy to reengineer your manufacturing processes and opens a big opportunity to change the scope of your business models. A great example of this is how Iconics is using OPC-UA standards and innovative natural user interfaces (NUI) to control plant equipment from remote locations. This approach allows operators to be more productive, while reducing costs and energy usage in production operations.
Therefore, becoming digital means changing the way we do things with a discovered mindset about how we relate and interact with objects. It gives us the advantage to change the scope of our actions and their ultimate result. In enterprise terms, being digital requires a higher level of thinking that must incorporate organizational, process and business change, in addition to applying technology, in order to outpace the competition. IIoT capabilities actually then take the role of people-enabler as opposed to being the ultimate solution.
Our initial learning from delivering IIoT projects tells us that the inhibitors to achieve business transformation are not as much related to technology as they are related to reinventing and adopting new practices. These inhibitors typically fall in the categories of how people make decisions and how people use new information to collaborate with humans or machines as peers. People need to start from scratch, putting all conventional wisdom aside in order to develop new skills to define and implement innovative practices and business processes.
Arming IIoT/P/S strategies with solid change management practices and strong organizational support helps IIoT technology play a successful role in digital disruption. Helping to change organizational and individual mindsets along with business platforms eases the way for corporations to augment their value proposition. Technology platforms then help to network people and things, making information easy to understand and impactful actions easy to execute. Using digital as a disruptor is the fastest way to build new mindsets. Take the example of how Accenture and Avanade drove change at Freeport-McMoRan using Microsoft technology to achieve higher levels of agility and innovation. Applying concepts and solutions that use innovative technology platforms can ease the way toward digital plant floor transformation by means of revamping old thinking patterns and networking people, things and services.
When you think digital, you think technology-agnostic. It makes you think more freely to innovate on processes and discover new sources of revenue. In my next blog I’ll discuss examples about how to achieve “digital”.
