What is IoT? Introduction to Internet of Things in Operational Environments
Walking into work this morning you greet your colleagues, log in to your computer and check your inbox. You see an email from the COO, your boss. Always challenging you to make improvements to the line’s efficiency and judging by last month’s poor performance, your heart begins to race as you open to read what’s inside.
Last month, your assembly line missed the delivery date on 4 separates orders, some incurring penalties of up to $2,000 per day in late fees. This recurring issue of missed deadlines and lack of transparency is starting to escalate, you can see. And you begin to wonder whether your own abilities as an effective manager are being called into question.
“So what are you going to do to ensure we don’t miss a single deadline this month??” the mail reads.
“What am I going to do?” you mutter, astonished. “As if this is all my team’s fault?” You begin typing your mail, outlining your argument that defends your team and shifts most of the blame on to the sales order process. You do bring yourself to admit that at least some of it has to do with your workflow and order processing, but that’s not the real issue, you point out. The sales guys, they’re the ones who submit their orders last minute and then pressure us to deliver on these tight deadlines.
Frustrated, you finish typing your mail. But just before you hit send, you pause: “What if this isn’t the right approach this time?” “Should I be offering ways of actually improving this?” “How could we solve this if we really wanted to?”
Data as a proactive approach to problem-solving
Operational managers in factories, warehouses, healthcare facilities and beyond experience the pressure to perform regularly. Increase productivity. Reduce downtime. Deliver on time. etc.
It’s a tough job. And an important one. The operations manager has a critical role in seeing that goods and services are provided on time, within budget, and according to the right specifications. They need to be proactive. When this doesn’t happen, penalties can incur, relationships can be tested, and the blame game can lead to a lack of trust across departments. Things can get messy.
How do you expect performance to improve when you’re working with the same limited information as you were the last time you tried to make a change?
The list of problems and potential solutions might seem countless. Let’s start simple by taking a step back and identifying the issues at the root of our problems.
If you take a look at the problem of labor productivity and forecasting, is the issue that your workers are too slow and easily make mistakes? Or is it that the sales guys submit orders with mistakes that require jobs to be delayed and reworked? Maybe a lack of transparency between sales and operations is making it impossible to align expectations. How can you know for sure?
In order to answer these questions with any certainty, we need to have relevant information to base our decisions on.
For business operations, relevant information comes from collecting data across everyday operational workflows.
Defining IoT and its role in successful businesses
Gathering data relies on technology. Right now, the way industry-leading companies are gathering data from operational workflows and using it to make decisions is through a process commonly referred to as the Internet of Things, or Industrial Internet of Things when referring specifically to the industrial sector (IoT and IIoT, respectively).
By equipping physical assets or workers with IoT devices, data on their environment and location can be known, analyzed, and cross-referenced with other sources of information like ERP systems, cloud services, etc. Which means that virtually any action, movement, or process can be used to optimize any business operation. True operational efficiency becomes a reality.
What data do I need?
The data you need varies from business problem to company. In our example, the information this operations manager should consider collecting includes:
- Cycle time
- Individual worker / shift / facility productivity
- Idle time vs active time
- Time between order submission and commencing of order
- Time spent on employees on each job daily, weekly, and monthly
- Cost per job
- Time spent searching for tools
How does data translate to operational improvements?
Data becomes useful when it can be used to make decisions. Knowing which questions to ask is the start. If, for example, you want to understand how productive your workers are, then you might measure how much time they spend in certain zones or with certain parts or materials related to a job.
Collecting data can be done by equipping both the worker and the materials with an IoT device, like a Bluetooth Low Energy tag, to easily measure the precise amount of time it takes to complete a job from start to finish and how long each worker spends on their respective tasks.
Today, the technology and cost barrier to entry for such solutions has dropped dramatically as solutions adapted specifically for small and medium-sized businesses have become available.
Out-of-the-box ready IoT solutions, built to solve common problems in workflow operations, means that you can launch a solution without breaking your budget or the need for a team of engineers and IT professionals to customize it to fit your business. Everything required to track, analyze, and make changes that improve your department’s performance is standard and comes included.
A New Day with IoT
Walking into work this morning you greet your colleagues, log in to your computer and open yesterday’s productivity report while you sip your coffee.
Your factory is “connected”: machines, tools and workers are equipped with devices that transmit data about operating conditions, performance and location. That data is analyzed in real-time to bring near-complete transparency to your business operations. You haven’t missed a deadline since implementation. You love it. And, importantly, your bosses love it.
Now you can identify inefficiencies and make improvements on the fly. Your workflow schedule, including real-time information on each job, is now available to operations and sales, facilitating transparency across your organization. It’s no longer a guessing game or constant back and forth, it’s your superpower.
In only six months, you’ve found problems that have plagued your company for years and implemented solutions to them. You’ve saved your company tens thousands of dollars while proposing new areas of innovation and set a new internal and industry standard leading the way in the digital era. That’s IoT.
This is the transformation all industries are undergoing. While the industrial, healthcare and retail sectors lead, others closely follow. Though the same cannot be said for all companies in those industries.
If you’re interested in how you can leverage IoT in achieving lean operations in a plant, check our whitepaper.