The Internet of Things

Here are a few factoids that I’ve picked up from a variety of sources:

  • The IoT is currently comprised of 9 billion connected devices.
  • It is estimated that by 2020, there will be as many as 75 billion connected devices.
  • By 2025 the total global worth of IoT technology could be as much as $6.2 trillion.

What is this behemoth? And what role does it play in the manufacturing space? These are the two questions that we’ll explore, understanding that short of writing a book the size of War and Peace, whatever we cover here can only touch the surface.

The Internet of Things: A Brief Definition

The shortest definition I could find states that “The IoT is the infrastructure of the information society.”

I don’t know about you, but that definition does NOT help me understand what the IoT actually is. So let’s try a somewhat longer definition that I’ve paraphrased into plain English:

“The IoT is an enormous network of interconnected things – devices and sensors – that communicate with each other, collect data, and exchange that data across the Internet.”

Think of it as a digital nervous system.

The Role of the IoT in Manufacturing

Let’s go back for a moment to the #3 factoid above and how it relates to manufacturing. Of the projected $6.2 trillion global worth of the IoT in 2025, manufacturing is predicted to account for $2.3 trillion. Meaning that of all the different industries that are adopting IoT technologies, manufacturing will account for more than a third. The only industry sector projected to have a bigger piece of the pie is Healthcare at $2.5 trillion.

Does this mean that manufacturing is on the leading edge of the IoT? Actually, yes. Last year, Forbes published an article by Louis Columbus entitled “Making Internet of Things (IoT) Pay in Manufacturing.” Columbus cited a study by The MPI Group that was based on interviews with 350 manufacturers. The findings were staggering.

  • 76% said they planned to increase their use of smart devices or embedded intelligence in manufacturing processes in the next 2 years.
  • 63% had implemented or were planning to integrate IoT technologies into their products.
  • 71% said IoT will have significant impact (24%) or some impact (47%) on their business over the next 5 years.

How are IoT technologies – smart devices, sensors, embedded intelligence – being used in a manufacturing setting? It’s mostly about communication and real-time visibility to:

  • Improve shop floor operations
  • Create smarter supply chains
  • Increase machine maintenance efficiency

For example, information communicated from plant floor sensors automates changes to the supply chain. Embedded sensors work around the clock to activate “phone home” alerts when there are potentially worrisome changes in temperature or humidity. Intelligent systems read asset health data to determine which assets are in need of preventive maintenance.

There’s a great Rolls-Royce case study on the Microsoft IoT Web site regarding the maintenance schedule for their aircraft and engine components. Using IoT technologies Rolls-Royce can use real-time data on the condition of their fuel pump components to drive a more flexible and efficient maintenance schedule, versus a fixed schedule that pulls a component out of use earlier than necessary or even worse, too late!

These examples of how the IoT is impacting the manufacturing sector are just the tip of the iceberg. New ways to use the IoT in our factories are being discovered and implemented every day. According to an article by Kevin O’Marah and Pierfrancesco Manenti in IndustryWeek entitled “The Internet of Things Will Make Manufacturing Smarter”:

“Technologies based on the Internet of Things have the potential to radically improve visibility in manufacturing to the point where each unit of production can be “seen” at each step in the production process. Batch-level visibility is being replaced by unit-level visibility. This is the dawn of smart manufacturing.”

Some are calling it the Fourth Industrial Revolution. Some are using the acronym IIoT to specifically refer to the Industrial Internet of Things. Whatever nomenclature one might use, smart manufacturing presages the dawn of a new era.

As experts in business management and Enterprise Resource Planning (ERP) software solutions for manufacturers, we at SSG are transfixed by the technological changes occurring within the walls of U.S. factories. We’re watching. We’re listening. And we’ll continue to share news with you regarding advances in the manufacturing sector.

Please visit us at, call us at 310.539.4645 or email us at We look forward to speaking with you.