Stan Eames

If you are making decisions for your business that pertain to information technology, then undoubtedly you have heard the term IoT, which is short for Internet of Things. Having been in the technology business my entire career, it always baffles me how these terms tend to pop up and stick, even when they can seem ambiguous and cryptic. If you are struggling to understand IoT, then you are not alone.

The fundamental idea that IoT stands for is simple. It represents the idea that virtually any device that exists can connect to the Internet and identify itself. This allows for communication with other devices without human intervention. When connected, the device inherits access to conduits of information that are bilateral, allowing the device to share information about itself as well as take in information from other devices.

Let’s look at a practical example that has been around for a while. The small printer industry famously sells printers for low prices while charging (sometimes shockingly) high prices for the consumables that they use. This model provides a recurring stream of revenue for the manufacturer in the form of consumable (i.e., ink or toner) purchases over time.

Rather than looking at the printer as simply a printer, let’s think of it as an IoT device that is connected to the internet. When you register your printer, connect it online, and identify it with the serial number, the manufacturer’s systems now know what the printer is, how to talk with it, and who owns it. Once registration has taken place, the printer now becomes a consumable ordering device that can order toner for you without your intervention (assuming you opted in for this service). This is an example of IoT enablement in a device that we normally just think of as a printer. However, with IoT enablement, the printer becomes more than that—it becomes a marketing machine for consumables.

Saving buyers from the chore of purchasing

How IoT intertwines with ecommerce is an exciting discussion. Buyers, particularly business-to-business buyers, spend a great deal of work time identifying replacement parts and consumables for the equipment that their business uses. Also, the time they spend looking for the item(s) needed typically occurs after the equipment fails or has already used up the consumables.

Imagine a piece of machinery that monitors its own consumables (like the printer), but also monitors the wear and tear within the machine via wear sensors, pressure gauges or merely the passing of time. If the machine connects to the Internet, then once the sensor(s) indicate the need for a component, the IoT connection can order it automatically.

Buyers no longer must search for parts—the machine orders them on the buyer’s behalf.

What’s even more interesting is that the IoT system can purchase parts in anticipation of a failure, which can optimize the avoidance of downtime. The IoT component of this architecture takes the machine from an internal indication of failure to a self-healing and maintaining operation. Rather than fail, the equipment can order parts, schedule replacements, and notify the engineers responsible for making it happen—all automatically and via Internet-based communications.

The doors are open for ecommerce automation

B2B ecommerce systems are constantly evolving to address the pressing needs of manufacturing organizations. One key operational capability to look out for in your system is the ability to interface with external systems that “push” orders to the ecommerce platform. Automating not only the purchasing process, but also the floor or fleet maintenance management can be a very powerful and compelling offering to your customers.

Manufacturers can not only use uniquely connected devices to assist customers with the maintenance of their products. Optimization of internal ordering for assembly parts, raw materials and components can also be achieved via inter-machine communications. Once a machine can provide useful information about what it is making and how that process is proceeding, the doors are open for several interesting automations. Besides the data being collected, the machine’s ability to be uniquely identified via a unique identification reference, coupled with the breadth of Internet connectivity is what allows the concepts of IoT to be put to work.

IoT is currently considered a forward-thinking technology, and one that is just starting to blossom in the real world. Over the next few years, the use of IoT concepts may define the difference between a “vanilla” manufacturing aftermarket operation and one that can deliver state-of-the-art service to its customers.

Planning for taking advantage of this technology begins with the fundamental design of original equipment internals. This requires planning how the equipment will connect, identify itself and share the information needed to automate its service. Considering the typical lead times required for engineering changes, having an IoT strategy in place as soon as possible ensures that your products can take advantage of this exciting technology well ahead of your competitors.

Stan Eames is the CEO of GenAlpha Technologies, a provider of ecommerce, e-catalog and customer portal solutions for manufacturers. He can be reached at [email protected] or contacted via LinkedIn.