Internet of Things impacts on manufacturing

Research shows that smart devices like machine sensors, radio-frequency identification readers and video cameras – connected to the Internet and the Cloud, and communicating in real time – are impacting significantly on factory-floor production and distribution processes worldwide.

Enterprise resource planning (ERP) solutions developer Syspro chief innovation officer Kevin Dherman says one of the main concepts influenced by the Internet of Things (IoT) is the smart factory.

The concept of a smart factory is based on the manufacturing process being more intelligent, dynamic and flexible, compared with current models. “In the era of intelligent manufacturing, the entire production chain, including suppliers, logistics and product life- cycle management, will be connected across corporate boundaries through the Internet.”

The smart factory will likely be realised through the increased implementation and acceptance of IoT.

Dherman says, according to business community website Business Insider’s 2015 report, ten-billion devices were connected to the Internet in 2015, with 34-billion to be connected by 2020. Its expected that of those 34-billion devices, IoT devices will account for 24-billion, while traditional computing devices, such as smartphones and tablets, will comprise ten-billion.

He notes that this market for IoT is being driven by challenging economic conditions and the necessary technology to realise much-needed lower operating costs, increased efficiency and faster response times.

“Technology is changing how manufacturing is done by combining factory floor processes with information technologies, which, in turn, are developing with the IoT to cause a shift in manufacturing.”

Dherman adds that the connectivity and application of data collected through the IoT devices have the biggest impact. “We have seen radical shifts in the production process as linked devices communicate with each other. “While manufacturers have been generating big data for a few years now, it’s their ability to effectively use it for analysis and real-time problem solving that is becoming the game changer.”

He asserts that it is not about innovating for innovation’s sake, but using the latest convergence of technology to transform business and lower the cost of storage and production by anticipating customer demand and maintenance issues ahead of time.

He advises that the IoT is integrating with ERP processes, citing the example of South African cabinet hardware distributor WCF Hardware Distributors. About a 100 pallets of stock a day are processed in its distribution centre. As a result of significant stock theft and escalating labour costs, the organisation automated its bulk warehouse.

The 1 864 m2 dark (figuratively) warehouse, which houses products for online commerce that are inaccessible to the public, can house 6 000 pallets comprising about 7 500 line items.

WCF contracted a Spanish company specialising in automated warehouses for this project. “Since WCF has been using Syspro’s ERP solution for more than 20 years, the company . . . has integrated its existing ERP solution with the warehouse automation. Syspro was instrumental in developing the necessary applications for the successful alignment of these systems,” Dherman explains.

Minimum human intervention has resulted in a reduction in stock theft and labour costs; processes are streamlined, accuracy has improved and stocktaking has been eliminated.