Hack and Craft reports on five IIoT trends driving change in 2020.
For a generation, European policy wonks have pondered how to create a European Google or Facebook. It should perhaps come as no surprise that the EU’s European Institute for Innovation & Technology recently made the case for Europe to focus its energies on its key industrial areas of strength. Innovation would come less via apps and platforms as it would smart manufacturing and predictive maintenance.
It’s a strategy that is not without logic, with Markets & Markets predicting that the global IIoT market will reach $91.4 billion by 2023. The IIoT landscape consists of a wide range of technologies, from RFID and smart beacons to GPS and monitoring systems. A number of key areas are likely to drive growth in the coming year, however.
1. Smart Manufacturing & Smart Factories
With the majority of IIoT investment in manufacturing, the smart factory seems a natural place to start. IIoT technologies offer the promise of creating a fully-connected factory whereby information and processes can flow seamlessly throughout the supply chain and out into the distribution network.
Smart factories will improve both the efficiency and quality of manufacturing, whilst also reducing the energy footprint of facilities and the costs involved in operating them. Some applications we can expect to see more of in 2020 include real-time monitoring of inventory and production flow, and smarter decision making throughout the supply chain.
It's estimated that 76% of manufacturers have begun a smart factory initiative of some kind, or are in the process of doing so, but just 14% of these companies are happy with the progress they've made to date. Nonetheless, data from Capgemini estimates that smart factories could contribute up to $1.5 trillion to the global economy in the next five years.
2. Smarter use of AI & Machine Learning
The University of Toronto's Ajay Agrawal, Avi Goldfarb, and Joshua Gans argue that the primary virtue of AI in the coming years will be in its ability to rapidly reduce the costs associated with making fast and accurate predictions. AI is increasingly being deployed with edge computing to allow these predictions to be made as close to the action as possible, thus further reinforcing its ability to guide decision making.
Despite recent research from Bain highlighting how predictive maintenance has yet to really fulfil its potential, due in large part because it has proven hard to implement and to accurately derive the kind of valuable insights that ensure a return on investment, there remains considerable potential for improvement in this field.
Indeed, the latest annual survey from Verdantix found that 85% of managers in charge of operational excellence at their firm believed predictive maintenance will be vital to the way their company operates in the next few years, both in reducing downtime and cutting costs.
AI, and particularly machine learning, is also powering the rise in digital twins, which incorporate AI with IIoT to enable a virtual replica of a physical system to be created and tested to provide companies with the opportunity to perform real-time optimization of systems in a cost-effective and efficient way.
Data from IDC suggests that 30% of Global 2000 companies will be utilising digital twins next year, both to improve product innovation and general organisational productivity.
3. The convergence of 5G and IoT
5G networks are set to become more pervasive in the coming year and will offer manufacturers tremendous benefits in areas such as efficiency, security and speed of data transfer. This increased data capacity will underpin a wide range of digital technologies, from AI and autonomous operations to virtual reality and drones.
The deployment of 5G networks will help organisations better connect sensors from their IoT platforms to provide remote monitoring, predictive maintenance and various other system monitoring to underpin the entire product lifecycle.
Indeed, so great is the promise of 5G that the MIT Tech Review recently argued that it will provide a boost to global GDP of over $12 trillion, which is broadly comparable with the economy of India.
4. 3D Printing & Additive Manufacturing
While it's easy to look at the slower pace of progress with 3D printing in manufacturing than many predicted a few years ago, it would be foolish to write off the technology as a fad that will never take off.
Despite the modest progress, the 3D printing sector was still worth $7 billion in 2017, and this is predicted to grow to over $20 billion by 2025. This is driven by the introduction of new materials alongside crucial advances in software, both of which are enabling a new wave of applications in areas such as bioprinting.
The advance in capabilities promises to herald a new age of prototyping, which should enable innovation to thrive as organisations become more agile and adaptive to the rapid changes in the marketplace.
5. Narrowband IoT will come to the fore
The global narrowband IoT chipset market is expected to grow to $265 million by 2023, with this being driven by demand for long-range connectivity and the growth in machine-to-machine communication.
Narrowband IoT offers not only extended coverage but also requires less power and provides secure connections for even the most sensitive data. With energy consumption likely to rise up the corporate agenda in 2020, the ability to deliver the benefits of IIoT whilst using less energy is likely to be extremely attractive.
With the costs associated with implementing IIoT solutions falling all the time, there remain concerns around the ROI of many digital transformation initiatives. The above technologies are likely to have a growing role in manufacturing in the year ahead, but the rewards will only come to those who implement them successfully into their businesses and do so at scale.
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