How Does IIoT Work & What are the Benefits for Industry 4.0?

January 31, 2024 by Ersan Guenes
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How Does IIoT Work & What are the Benefits for Industry 4.0?

The world of technology is rapidly advancing, bringing along with it a new era of industrial automation. The Industrial Internet of Things (IIoT) is one such approach to technology that is revolutionizing the industrial sector by enabling smart factories, intelligent machines, and interconnected systems. IIoT comprises a complex network of devices, sensors, software, and machines that work together to collect, analyze, and communicate data.

Connected technologies promise to deliver more efficient, productive, and cost-effective industrial processes that will redefine the way we work. In this post, we will explore the intricacies of IIoT, how it works, and its endless benefits that are driving industry 4.0.

What is the Industrial Internet of Things (IIoT)? 

The Internet of Things (IoT) is a network of physical objects connected by the Internet through sensors and software - this can be as simple as controlling a thermostat on your mobile device. Any object can become an IoT device as long as it is capable of connecting to the internet and communicating information.

IIoT follows the same principles as IoT but in industrial settings, where systems, people, and devices communicate with each other in a connected network. One example is forklifts equipped with tracking sensors in a manufacturing facility that communicate location information and detect nearby obstacles. The most significant benefit IIoT has had on the industrial revolution is its ability to provide data that we’ve never had before, allowing companies to make more informed decisions.

How does IIot Work?

IIoT works by leveraging a network of devices and sensors that communicate with each other to generate and transmit real-time data. These connected devices and sensors can be installed on machines, vehicles, equipment, and other assets in industrial settings to gather and transmit data to a central system.

The central system, which could be a cloud-based platform or an on-premise server, processes the data and creates actionable insights that help businesses optimize their operations. This can include identifying potential performance issues, predicting maintenance needs, automating workflows, or improving safety protocols.

What are the Benefits of IIoT?

From predictive maintenance to automation, the potential uses of IIoT are vast and varied, and the benefits can be realized in a range of industries, such as manufacturing, warehousing, and transportation. By leveraging connected devices and manufacturing analytics, IIoT enables industries to streamline their processes, boost manufacturing efficiency, and improve safety. Here’s how:

1) Increased Visibility  

In factories of the past, visibility was often limited due to old processes and data. Organizations would know what they had in their factories but not where their assets were and when they were moving. One of IIoT’s top benefits is its ability to give you unprecedented visibility over your operations. Through real-time information, organizations are gaining data that provides a 360-degree view of their organization.

Entire facilities can be connected, from vehicles and assets to personnel, through tags with sensors attached. The location and time-stamped information can then be integrated with systems like Enterprise Resource Planning (ERP), allowing for greater connectivity. This information is also available on a consolidated user interface and on a variety of devices, for digitized and highly-accessible operational awareness.

More specifically, IIoT can show an operations manager how production is running in real-time, with a great amount of detail. Through monthly or weekly reports, data can pinpoint if there are manufacturing errors or certain machines that are performing poorly. It allows operations managers to see what’s causing delays in production and to be able to make informed decisions to resolve those issues. In an increasingly competitive landscape, being able to quickly resolve any delays can help organizations stay ahead of the competition.

2) Higher Efficiency due to Automated Workflows  

Workflow automation is key to boosting productivity and ROI, which is what IIoT provides. By automating mundane and simple tasks, work efficiency is improved, and your employees can focus on using their skills on more nuanced tasks that benefit your organization. Through IoT, automation also helps keep a wide range of devices connected, making processes more efficient.

In manufacturing or intralogistics settings, workflows include identifying materials with barcodes. In cases where people are manually scanning barcodes, it takes longer, and human error must be accounted for. With the use of smart machines, these processes can be done exactly how the organization wants. Additionally, since the machines are always connected, you'll be able to identify if there is a malfunction happening before it’s too late. The ability to automate these manual tasks to streamline processes and get desired results is what drives IIoT projects. 

3) Accurate Forecasting and Planning with Location Data

Location data helps organizations plan better than they ever have. Teams used to rely on historical data for forecasting, but another benefit of the IIoT is the ability to generate near real-time reporting. Location data is collected in a Real Time Location System (RTLS) by attaching tracking tags with sensors to personnel, assets, and vehicles across your facilities. They then transmit their location data to fixed readers (RTLS anchors), which integrate the information into the software and can be seen on various devices.

This data is also visualized on a digitized facility map, providing facility managers maximum control. A company struggling with supply chain issues could use location information to pinpoint exactly where the delays are happening and make the decisions needed to fix errors and optimize processes. In addition, this data can help create faster routes for vehicles, efficient schedules for employees and machines, and as a result, make your processes more competitive.

The Inpixon RTLS solution is a fully technology-agnostic platform that seamlessly integrates position and identification data from various RTLS technologies and other sources with ERP, MES, WMS, and other systems.

4) Optimization of Operations and Processes  

IIoT has provided manufacturers with the ability to constantly improve their operational efficiency through the use of real-time data. The interconnectedness of devices, from forklifts to production equipment, creates an ecosystem that allows for a holistic view of the entire facility. With access to this information, organizations can make better decisions and set improved goals, increasing transparency and accountability throughout multiple production stages.

By understanding which machines are being utilized and which are not, facility managers can maximize equipment output and assign additional production jobs to machines that aren't busy. This eliminates wasted time and resources and enables the facility to run as efficiently as possible. The ability to see the entire facility in action also creates opportunities to make better decisions that optimize routes and reduce traffic jams, further increasing efficiency.

The use of IIoT data also allows for the identification of potential bottlenecks and areas of improvement in the manufacturing process, which can then be addressed through targeted solutions. This constant improvement leads to increased productivity, reduced downtime, and, ultimately, increased profitability. With IIoT, manufacturers have access to a wealth of information that enables them to optimize their operations and processes, setting them apart from their competitors.

5) Avoid Process Errors

One of the biggest issues holding organizations back is machine downtime, costing almost $1.5 Trillion every year. Through older processes, equipment malfunction would result in defective products, costing time and resources. IIoT makes rapid detection possible and allows organizations to optimize production quality and get ahead of equipment failure.  

It also minimizes human error, which accounts for a significant percentage of mistakes in manufacturing and industrial settings. These errors can happen due to exhaustion, which results in employees inputting data incorrectly or scanning the wrong barcode. With IIoT, if an employee is attempting to package a shipment and puts in the wrong item, they can get a warning in real time that they’re making an error. These alerts can be found by notification on a tablet, mobile phone, or smartwatch and prevent customer complaints and the loss of resources. Data from IIoT allows for consistency and reliability in business processes, which is why this is an exceedingly popular use case.

6 ) Workplace Safety and Location Awareness:

A crucial aspect of IIoT and RTLS concerning workplace safety lies in establishing comprehensive location awareness. Continuous monitoring of employees' locations not only ensures that they are in secure areas but also enhances emergency response capabilities. In case of an accident, precise location tracking enables swift response times, further improving employee safety. Additionally, location data can be utilized to optimize evacuation plans' efficiency and provide precise instructions during emergencies.

7) Cost Savings through Preventive Maintenance:

Preventive maintenance facilitated by IIoT and RTLS not only contributes to minimizing downtime but also offers significant cost savings. Early detection of anomalies or wear allows companies to schedule maintenance before costly breakdowns occur. This targeted maintenance not only reduces costs for spare parts and repairs but also extends the lifespan of equipment, resulting in an overall more efficient and cost-effective operational management.

8) Quality Control and Traceability:

The integration of RTLS into IIoT enables precise quality control and traceability throughout the entire production chain. Every step in the manufacturing process can be traced with accurate location data, allowing seamless traceability from raw materials to the end product. This is particularly crucial in industries with stringent quality standards, as companies can swiftly respond to quality issues. Accurate traceability also facilitates recall actions in case of quality concerns, enhancing consumer trust.

9) Integration with Supply Chain Management:

In the realm of supply chain management, the integration of IIoT and RTLS enables real-time, precise tracking of goods and inventory. Real-time information contributes to optimized planning and control of the supply chain. Companies can monitor the flow of goods more effectively, manage inventories more efficiently, and predict delivery times more accurately. This leads to an overall enhanced supply chain performance, faster deliveries, and optimized inventory management, resulting in cost savings and increased customer satisfaction.

Thinking of implementing RTLS to bring greater connectivity into your industrial facilities? Inpixon’s state of the art technology is ready to bring you into the future. Contact an expert with questions today or watch our webinar on the top 5 challenges of implementing a RTLS and how to overcome them.

This article on the Industrial Internet of Things first appeared on February 1st, 2022 and was updated to reflect new information on IIOT and its benefits on January 31st, 2024.

Ersan Guenes is the Senior Vice President (SVP) of Product for IIOT (Industrial Internet of Things) at Inpixon.