Look around, and the manufacturing industry is brimming with examples of firms that are bringing the latest technological developments to their factory floors. Their goal? To improve processes, increase automation levels, and facilitate future business growth.
A case in point is the manufacturing giant Siemens, which has used automation to reduce the rollout time of new products by a third. Another example is global autoparts manufacturer Hirotec, which has used cloud-based analytics and internet of things (IoT) to reduce system inspection times by 100 percent—a move that has helped the company avoid a painful $361 per-second bill for downtime during manual inspections.
It’s outcomes such as these that are inspiring other manufacturers to implement IoT technologies into their production environments. In fact, according to recent research from Epicor, conducted by Morar Consulting, 69 percent of the 2,200 manufacturers from 14 countries believe their industry is on the verge of large scale IoT adoption, or is at least at an experimental level.
Counting the gains
However, where IoT is put to work – with production robots that can send and receive data, or perhaps the use of RFID technology to connect shipments with factory equipment – not every manufacturer is finding it easy to measure the gains enabled by these technology implementations.
This, it seems, is the harsh reality of IoT. Many firms within the manufacturing community are struggling to justify their spend on all of this new technology.
IoT and enterprise resource planning (ERP) – the perfect pairing
By default, the IoT involves capturing a huge amount of data – from the production line through to the wider supply chain. If the IoT is to truly bring value to an organisation, this data needs to be captured and analysed via an effective enterprise resource planning (ERP) solution. After all, a return-on-investment figure can’t be calculated if outcomes cannot be measured.
Using ERP technology alongside IoT solutions is becoming increasingly accepted among manufacturers as a way of addressing this particular challenge. Many are starting to recognise the importance of placing an ERP system at the heart of their smart factories because it means that centralised monitoring becomes possible, accurate data can be collected, informed decisions can be made, and improvements can be measured.
As we move further into 2019, we can expect to see switched-on manufacturers continue to shift towards using intelligent cloud-based ERP solutions to justify their IoT investments. This will enable them to continue to take advantage of new opportunities, to optimise processes, and to remain agile. All through the powerful combination of IoT and ERP.
Manufacturing is certainly back—gone are the days of dirty or dingy factories. Gone is the high use of manual labour and blue screens. Instead, we are entering an Industry 4.0 world where manufacturing is increasingly digital. In this world, ERP software combined with smart factory technology will be the perfect pairing.
To find out more about how you can use ERP to measure the ROI from your IoT investments, check out the Mint Jutras report about the many ways cloud can facilitate growth. If you’d like to benchmark your tech investments and subsequent business growth levels against other manufacturers in your region, view the Global Growth Index.