By Mikes James, Chairman, MESA International Board of
Directors
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Internet A Series Of Tubes by Jeremy Brooks (CC BY-NC 2.0) |
In
the fourth blog post of this series, we explore how the internet of services
fits with smart manufacturing. There is much talk about the Internet of Things
(IoT). However, ‘things’ are just part of the plumbing. We connect devices,
giving them, no more than, nominal intelligence. The real innovation is the
internet of services. Manufacturers need to think through their business model:
how can a product become a service with a long-term revenue stream?
Many manufacturers are recognizing and exploiting the opportunity. For example,
Tesla is delivering vehicles with hardware and software which can be upgraded,
their cars are sensor ready and software upgrades will provide extra
intelligence, delivered via the internet. The customer could pay for the upgrades
which then generates extra revenue for Tesla.
Otis is supplying elevators/lifts
with sensors which send data into their cloud. The data is analyzed and Otis
sells a predictive maintenance services package, again adding a long-term
revenue stream.
Additionally, a new catering company in The Netherlands is
supplying custom meals to hospitals. Each meal is prepared for the patient
based upon data received from the hospital about the patient’s needs. The meals
are prepared in an automated plant.
The individualization of mass production and the internet of services add
additional revenue. The smart manufacturing plant needs to be flexible and
deliver intelligent products. A major
misunderstanding is that this is not a cost saving exercise; it’s a new
business model to increase revenue and profitability.
It’s important to map out opportunities and match them against the realities of
today’s technology. A manufacturer who was heavily investing in a factory of
the future did not build this type of strategy. Enthusiastic engineers ordered
additive manufacturing machines (3D printing) only to find out they could not
connect them to their network using international standards. They paid a heavy
price for this error and damaged the initiative’s reputation. It’s worth taking
independent advice before completing your new manufacturing strategy.
The
best way to avoid these mistakes and build a successful strategy is to learn
from other manufacturers in a safe space. MESA is a safe harbor to share best
practices and lessons learned so that the industry can collectively rise to
Industry 4.0.