Industrial IoT: Opportunities and Threats

Posted: 2022-07-22

The Internet of Things (IoT) is the backbone of every industry, and its significance is growing every year, changing the world rapidly. In 2020, the global IoT market in manufacturing was worth 198.25 billion USD. It is expected to reach 1,495.65 billion USD by 2030.

Where does IoT stand in the production sector? In this article, we will cover the most significant opportunities and threats of implementing IoT for companies operating in this industry.

What is Industrial Internet of Things?

IIoT is the foundational technology and a vital element of Industry 4.0. This term is related to systems composed of intelligent devices equipped with sensors whose only task is to improve production and industrial processes. Due to the fact that IIoT generates large amounts of data, owners of production companies can make better data-based business decisions after careful analysis.


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Industrial IoT: Key Benefits

1. Industrial Internet of Things and saving time

One of the most important benefits of IoT solutions in the industrial sector is that they save working time. IoT can support tasks related to registration, configuration, maintenance, updating, and monitoring of machines. In fact, some of these processes can be managed remotely.

Industrial control systems are an important element in the development of IoT. According to the latest Deloitte report, as many as 30% of control systems will be equipped with analytical functions using artificial intelligence in the next three years.

2. Operation precision and possible error risk reduction

In the production industry, even the smallest mistake can be very expensive. The introduction of intelligent, automated systems makes it possible to avoid human errors that may result from fatigue or loss of concentration. A well-programmed system always runs consistently, is not subject to being overworked, and is much more precise and accurate than humans, which can increase the efficiency of the entire company.

3. Improved efficiency of operations with IIoT

According to a PwC survey, German production companies expect a performance increase of 12% in five years after implementing intelligent solutions. The implementation of IoT solutions in the industry means that employees can deal with tasks that affect development while the machines perform repetitive work. Relieving employees of mundane and unsatisfactory work influences their overall commitment and satisfaction and makes them stay with the company longer.

4. IoT solutions in the industrial sector provide better work planning

By analyzing historical data and variables such as weather conditions or material shortages, IoT allows companies to make better business decisions. Accurate predictions are critical for production companies wanting to sell as many products as possible without wasting resources. Appropriate real-time forecasting can help when planning activities related to the supply chain or the work of individual departments.

5. Ability to generate valuable data for business

IIoT technology allows companies to collect huge amounts of data from each stage of the production process. Because of this, producers are able to detect issues that require improvement (e.g., malfunctions of assembly line parts) and optimize the production operation to achieve maximum efficiency.

6. IoT in production: a chance to build a competitive advantage

The use of innovative technologies such as IoT and the integration of human work with machines has allowed companies to develop more business opportunities. This is a great way to expand existing offers and introduce changes that will improve production efficiency.

7. Increased employee safety

IoT solutions in the industrial sector also help create a safer work environment. These solutions can be advanced monitoring systems or devices that employees have with them while working. Sensors placed in industrial IoT devices detect and inform workers of irregularities in real time such as machine vibrations or temperatures that are too high or even gas leaks. Cameras can detect staff moving through dangerous parts of the plant and inform connected machines to trigger them to switch to safer operating settings.

8. Reduction of costs with device maintenance and servicing

In the production industry, a key element of success is predictive maintenance, i.e., a technique that allows you to monitor the condition of devices during their operation and determine the optimal frequency of inspections. This saves time and money by only having to perform maintenance when necessary, which results in less machine downtime and contributes to cost reduction. This is confirmed through a study published by Deloitte, according to which the IoT technology increases productivity by 25%, reduces the number of malfunctions by 70%, and reduces maintenance costs by 25%.


The Biggest Concerns about the Implementation of IoT Solutions in the Industrial Sector

Some of our customers from Industry 4.0 shared their concerns related to the implementation of IIoT (Industrial Internet of Things). Most of them align with the challenges identified by Deloitte in the latest Tech Trends 2022 report. Below we explain how you can mitigate those challenges.

1. Lack of skilled data management staff

In order for the IIoT technology to bring real benefits to production companies, it is important to properly store, process, analyze, and manage the data generated by intelligent devices. This requires skilled employees who can turn raw data sets into valuable business tips or properly analyze reports previously set up by an IoT solution provider.

It is worth emphasizing that after creating and configuring your IoT solution, you do not need highly qualified specialists to operate the data management system on an ongoing basis. If you choose a proven provider who creates a solution based on the latest technologies, the threshold for entering the position of a data scientist will be relatively low. By integrating the latest innovations, you will be able to easily find the necessary specialists or even train current employees for this role.

2. The need for constant connection to the network

Another challenge in implementing industrial IoT solutions in production is the need for constant connection to the network. In large plants with a lot of different machines and devices, finding the most efficient and durable solution can be a real challenge. Companies must take into account factors such as energy consumption, signal coverage, cost, safety, frequency division, and the risk of various electrical, physical or even weather disturbances.

However, taking into account the dynamic development of new technologies, connecting to the network is no longer problematic. The COVID-19 pandemic has accelerated investments in modern wireless network technologies (especially 5G and Wi-Fi 6), characterized by high efficiency and scalability. These solutions make the connection of industrial IoT devices to the network easy and optimal.

Wireless networking technologies are complementary, meaning they can coexist or combine to support specific solutions. Just as many organizations diversify energy technologies and energy generation sources to ensure business continuity even in a devastating storm, they may also need to diversify their wireless network technologies to ensure reliability.” (source: Deloitte Report: Tech Trends 2022)

3. Increased risk of cyber attacks

Regardless of the industry or area of life, today’s virtual world is constantly exposed to cyber attacks. Of course, some of them can concern security breaches in IoT systems. Gartner predicts that as much as 25% of attacks will be related to IoT, and security expenses in this sector will amount to 547 million USD.

Cybersecurity is indeed a very important aspect that cannot be underestimated. However, there are many modern methods of data encryption that minimize the risk of information leaks or system hacking. Using professional solutions and services from experienced providers will protect your data better than if you keep it in company server rooms.

4. Uncertainty about return on investment

Due to its innovativeness, the Industrial Internet of Things, is often associated with high costs of implementation, management, and maintenance. Many entrepreneurs fear that such an investment may even exceed the potential profit.

Is this fear really justified? At this point, it is worth quoting the data from the PwC report, according to which 50% of entrepreneurs in the production industry expect a return on investment in digitalization in just five years.

It should also be remembered that the opportunities offered by IoT are much more than just expense reimbursement. It is an investment in safety, health, and employee satisfaction as well as an improvement in customer experience and environmental protection, which are all invaluable.

When analyzing the potential costs, keep in mind that each case ought to be studied individually. If you do not have a lot of knowledge and experience in this topic, consult an experienced technology partner who will be able to suggest a solution tailored to the needs, abilities, and specificity of a given organization.

5. Difficulties with integrating existing systems with IoT

In order for the entire ecosystem of devices connected to the IoT to function properly, it must be appropriately configured and integrated with the systems your company uses. This can be complicated, especially when using legacy systems.

In this case, the answer is to create a dedicated IoT solution that will be designed and tailored to your company’s systems.

6. Issues with storing data generated by IoT sensors

Another thing that can prevent you from implementing IoT solutions in the industrial sector is issues related to data storage. Do you have the right tools and servers to store all the data generated by industrial IoT devices? In fact, most corporate information today is stored in cloud computing, which not only enables you to store huge data sets but also ensures greater security.

Cloud technologies are becoming more and more popular, but this is not the only solution available on the market. It is also worth noting the increase in popularity of edge computing, a method of storing data and mass storage directly in the place where it is generated (e.g., industrial IoT devices or their controllers). According to the latest report by Deloitte, as many as 72% of IT leaders already use this technology.

Revolutionize your business with IoT and become an important player in Industry 4.0

Although the implementation of IIoT (Industrial Internet of Things) solutions entails many challenges, the benefits of properly implemented innovation far outweigh the potential risks. It is also important to choose the right technology partner to avoid “reinventing the wheel” and to be able to use proven methods that allow you to achieve the greatest possible results. With the cooperation of an experienced company that has already implemented similar projects, you will be ready to handle the potential difficulties of integrating a digital transformation into a production company. Moreover, it will help you properly prepare and go through the entire process, as well as find solutions tailored to the individual needs and specificity of your organization. 

We are sure that with this approach, the Industrial Internet of Things (IIoT) will provide you with long-term benefits, a competitive advantage, and make you a major player in the Industry 4.0 sector.

If you are looking for a technology partner to create dedicated industrial IoT solutions, drop us a line! We know how to create complete IoT products and we will be happy to advise you. Get in touch to arrange a free consultation!

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