Improving Business Performance with IIoT

IIoT and Industrie 4.0 offer examples of new technologies that provide an opportunity to improve business performance for both owner-operators and OEMs:

• Plant owner-operators: Operational and business process improvements through removing waste and/or better work flow


• Original Equipment Manufacturers: New sources of revenue by extending the company’s business model into aftermarket services

With IIoT, equipment-related data is combined with analytics to help assess an asset’s health for early detection of a fault before failure and unplanned downtime occur. Detecting and repairing a fault before it cascades into extensive destruction of other parts and equipment significantly reduces the costs for repair and avoids costly unplanned downtime.

Operational Improvements for Owner-Operators

The first benefit, operational improvements, applies to plant owner-operators in two distinct areas: predictive maintenance and optimizing operations.

Predictive Maintenance by the Owner-Operator

The leading use of IIoT involves predictive maintenance for particularly critical, expensive, and/or problematic assets. These situations frequently get close management attention because of the often high dollar impact on the organization’s ability to make product and produce revenue.  With the clear financial benefits, even complex custom projects using IIoT, analytics, networking, and equipment modifications typically get approved.

Optimizing Operations

IIoT provides equipment data (like current draw) for analysis with existing sources of process data (like flow rate). Since historians typically connect to process control systems, they contain process data.  IIoT connects to the equipment, providing equipment data.  Analytics using data from both operations and equipment provides new opportunities for coordinating resources and information to improve asset performance management (APM).

Revenue Enhancement for OEMs

IIoT provides OEMs with two distinct ways to enhance its products and grow revenue. One involves improving the equipment design; the other adds aftermarket services.

Closed-loop Product Lifecycle Management (PLM)

Most equipment manufacturers ship products and never obtain feedback on performance - until something goes wrong and the customer complains. Other than testing some prototypes, product development is often performed "open loop," without direct customer feedback.  However, with IIoT, product designers can “close the loop” using IIoT-derived data from a variety of field operating environments.  Analyzing these data for product development provides opportunities to optimize designs, gain a competitive advantage, and grow market share for increased revenue for existing product lines.

Predictive Maintenance by OEMs

When a critical piece of equipment fails, production can be interrupted, affecting shipments and revenue. To achieve quick repair, the owner-operator has its own on-site maintenance staff.  Most OEM’s services strategy supports these resident maintenance technicians.  With IIoT- enabled remote monitoring and PdM, OEMs have an opportunity to significantly expand services with new sources of revenue.

No one knows the equipment better than the OEM that designed it. The OEM can develop analytics that use IIoT data to assess condition and provide value-added PdM services that inform users of a pending issue before they experience the problem.  The OEM sells PdM services and technical support to achieve near-zero unplanned downtime for its equipment installed in customer plants.  The support can be offered as an aftermarket subscription in various levels from a simple email alert service with a help desk, to having the OEM’s field service technicians make repairs.

Preventing Lost Alerts and Improving Data Quality

IIoT-enabled asset health monitoring solutions can generate alerts when an issue arises. But what happens next?  Responses from ARC surveys indicated that “ad hoc communications” is the most common method used to transfer an alert to maintenance.  These ad hoc communications can include email, phone calls, or even a chance meeting in the hallway.  As a result, alerts are often lost and the equipment fails just as predicted.

By automating these types of business processes, owner-operators can capture alerts to prevent unplanned downtime. IIoT-derived equipment data goes into the historian and analytics (either custom algorithms or machine learning) to assess equipment health.  In the following diagram, the PdM system has access to both process and equipment data.  Alerts generated by the PdM system are automatically transferred to the EAM system, which automatically generates a maintenance work order for review, approval, and scheduling by the maintenance planner.

Business Process Automation Helps Prevent Lost Alerts

Mobile devices allow technicians to process the work order while they are doing the work. Mobility solutions can also help improve data quality and timeliness in the EAM system.

See a YouTube video recording of the author’s presentation of this topic with additional information during a recent ARC Forum.