Studies & Reports
Report: Automotive manufacturers behind the curve in scaling IIoT investments
By Manufacturing AUTOMATION
By Manufacturing AUTOMATION
September 13, 2019 – North American manufacturers in the automotive and heavy industry sectors say in a new report that they are unable to scale their Industrial Internet of Things (IIoT) investments across their enterprises, and therefore are losing millions of dollars in potential profits while falling behind competitors.
Software AG conducted a survey of over 125 North American manufacturers primarily in the heavy industry and automotive sectors, which also also revealed that the vast majority of manufacturers queried report that their IIoT investments are limited – locked in one small department or sector of their company – preventing these organizations from sharing the power of IIoT across their enterprises.
IT-OT integration causing bottlenecks
This has caused these manufacturers to lose millions of dollars in potential profits as they fall behind more forward-thinking competitors that have invested in predictive analytics and innovative integration strategies that scale IIoT across the enterprise.
Other key findings include:
- 80 per cent of all survey respondents agree that processes around IIoT platforms need to be optimized or they will face a competitive disadvantage but very few are doing this
- IT-OT (information technology and operations technology) integration is considered one of the most difficult tasks – with 57 per cent of automotive manufacturers stating that this has prevented them from realizing full ROI from their IIoT investments
- 84 per cent of automotive and heavy industry manufacturers agree that the most important area of IIoT is “monetization of product-as-a-service-revenue.” However, optimizing production is still important with 58 per cent of heavy industry and 50 per cent of automotive manufacturers agreeing with that statement
- More than 60 per cent of respondents stated that defining threshold-based rules was as difficult as integrating IT systems and IoT sensors into existing control systems.
“Manufacturers place a high value on IIoT, but they are encountering serious difficulties in unlocking the complete intended value to unleash their innovation across their organizations,” says Sean T. Riley, global industry director, manufacturing and transportation for Software AG.
“Fortunately, there is a way for them to quickly and easily resolve this problem. By investing in the right IT-OT integration strategy that leverages sensors, predictive analytics, machine learning, control applications and product quality control, manufacturers can fix this problem in less than six to 12 months while realizing other key benefits, namely extended equipment lifetime, reduced equipment maintenance costs and accessing more accurate data for production-quality improvements.”
Best practices to scale IIoT investments
Riley outlined five best practices for manufacturers to follow when looking to scale their IIoT investments across their enterprises and realize immediate profits and competitive advantage. Those best practices are:
- Ensure clear collaboration between IT and the business by leveraging a step by step approach that starts focused and has clear near term and long- term objectives to scale
- Create a transparent roll out process and don’t let other plants or departments move ahead outside of it
- Give IT the ability to connect at speed with a digital production platform that is proven to be successful
- Leverage a GUI-driven, consistent platform to enable an ecosystem of IT associates, business users and partners around the platform
- Enable the plant or field service workers to work autonomously without continual support from IT through GUI-driven analytics, centralized management and easy, batch device connectivity and management
The Software AG IIoT Implementation survey was completed in Q2 2019 by Software AG and an independent third-party research house. The survey queried nearly 200 respondents at large manufacturing companies across automotive, heavy industry, high-technology, electronics, pharmaceutical and medical device industries. The respondents were primarily senior executives leading manufacturing or information technology with the breakdown of 50 per cent managers, 38 per cent directors and 13 per cent vice-presidents or higher.