IoT makes industrial manufacturers “smart”

The internet of things has roots in the world of manufacturing and smart factories. Of the industrial manufacturers surveyed, 71% indicated they're already building or testing IoT-related solutions in both active and in-development projects. They’re equally active in analytics (73%) and artificial intelligence (63%), the keys to making sense of IoT data.

Industrial manufacturers are using IoT across the business: 60% on projects within their facilities, 57% with supply chain and other partners, 42% with end consumers and 58% with their business customers. Their top focus areas are logistics (50%), supply chain (47%) and employee and customer operations (46%). 

Manufacturers are optimistic about IoT: 93% believe its benefits exceed its risks. In fact, 68% plan to increase their investment over the next two years.

But that doesn’t mean there aren’t concerns related to “trusted tech.” In fact, 53% of respondents said they are “extremely concerned” about cybersecurity—the highest number among all the industries surveyed. Another 35% are “somewhat concerned.” Other areas causing unease include data integrity (83% are concerned), data privacy (80%), workforce impact (75%) and AI issues like ethics and bias (70%). 

Industrial manufacturing firms are addressing these concerns by improving the tech infrastructure, deploying better data management methods and addressing workforce culture and change management. They also are taking steps to mitigate IoT’s challenges. For example, 60% are addressing AI bias, ethics and responsibility, 58% are working with partners to better manage ecosystems and 44% are developing more robust policies to address the impact of AI and IoT on data privacy.

Here are use cases industrial manufacturers are exploring: 

Making operations self-sufficient
Most (81%) industrial manufacturers surveyed reported that they are making operations more efficient through the use of IoT. Forty-three percent have already benefited from using IoT-based asset management, and 41% expect to do so within two years. Many use sensors to monitor and access everything—from the operational state of machinery to getting alerts when storage tanks, trash dumpsters, exit signs and smoke alarms need to be serviced. 

Optimizing factory conditions
IoT solutions monitor manufacturing conditions and, using built-in policy enforcement, alert managers when the operation isn’t functioning at a desired level of efficiency. IoT-enabled predictive maintenance can help prevent equipment from malfunctioning, and 44% of the manufacturers surveyed have already deployed that capability, with another 27% planning to do so within two years. Dashboards can provide deep visibility within a partner ecosystem and supply chain.

Monitoring the supply chain
IoT solutions can monitor the condition of products from when they are made in a factory (or grown on a farm) to the arrival at their final destination, providing the location of those products continuously in real time. IoT also can optimize delivery routes, reduce errors and minimize fraud. Of the industrial manufacturers in our survey, 41% have already achieved supply chain benefits from IoT implementations, and 40% expect to see value within two years. 

Ramping up safety and security 
Connected safety and security solutions—including biometrics, image recognition and environmental sensors—allow manufacturers to better control physical access to, and security of, sensitive production assets and systems. For example, IoT solutions that include facial recognition can eliminate "badge swapping," which puts unapproved people in a tool crib, or uncertified operators at the controls of a machine. Of the manufacturers surveyed, 39% have improved security with IoT, and 44% expect to do so within the next two years.

Creating a digital twin 
More advanced IoT uses include digital twins, virtual models that simulate physical assets to better understand product features and lifespans. Companies can create digital twins to represent the “things” in their IoT, enabling them to monitor each one, improve designs, learn about and correct any potential problems and prevent production disruptions before they occur.

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See how IoT is affecting other industries:

Retailers are sold on IoT

The retail sector has a high percentage of companies with active IoT projects: 58%, compared with 48% of all the respondents in our IoT survey. Another 30% of the retailers have IoT projects in a research or development phase.

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The hospitality industry welcomes IoT

Hotels, restaurants and other consumer-focused hospitality businesses have been quick to adopt IoT. In fact, 70% of hospitality executives report that they have active IoT projects—far ahead of the average (48%) for all others in our survey.

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IoT cures health industry headaches

Health has been an early adopter of IoT. Nearly half (46%) of the health industry executives in our survey said their organization is actively using IoT, and another 21% have projects in development.

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Connect your business with IoT solutions

Locate, track, and identify people and assets: Connected Solutions, a product by PwC

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Transform your supply chain: Connected Supply Chain, a solution by PwC

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Steve Pillsbury

Partner, PwC US

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