IT infrastructure services, IT infrastructure management
Dec 07, 2017

How managed services for Internet of Things are transforming the industrial internet?


Coined as a term in 2012 by General Electric, the Industrial Internet of Things (IIoT) or simply, the industrial Internet, is estimated to be a $225 billion worth industry by the year 2020[1]. With a range of technology-based innovations including driverless (or autonomous driving) vehicles, along with centralized monitoring of these smart cars, IIoT is ushering major innovations in the manufacturing sector, including the automobile industry.


Advantages of IIoT

When it comes to driving automation in manufacturing facilities, enterprises are committed to driving operational excellence through lower production downtimes, increased efficiencies, continuous product improvement, among other benefits. This can be made possible through IIoT which brings together synergies between smart manufacturing and information technology to make the overall production process cost effective and responsive to changing market demands.

Industrial IoT has the potential to deliver far greater value that simple IoT used in industries. While consumer IoT has its focus on convenience and shorter feedback loops, adoption of IIoT can provide real-time visibility into the performance of critical industrial infrastructure and provide data to build predictive analytics that can prove invaluable in scenarios such as equipment failure or downtime.


Significance of IIoT in the modern world

According to the IIoT spending forecasts released by IDC, the following 3 industries are expected to make the most investments in IIoT technology[2]

  • Manufacturing industry, which accounted for an investment of $102.5 billion in the year 2016.
  • Transportation and logistics industry, with an estimated investment of $78 billion, is likely to be a key contributor to IIoT, along with the development of a connected logistics system.
  • Energy and Utilities industry, mainly comprising of the oil & gas and the smart power grid sector, and accounting for a 2016 investment of $57.8 billion.

As an example, the IIoT-powered Asset Performance Management from GE Digital has enabled the power generation company, Salt River Project (SRP) in reducing their costs by $0.5 million annually.[3]

Not limited to mainstream manufacturing industries, IIoT has seen strong adoption and growth in other industries including healthcare, mining, and aviation.


How IIoT enables seamless integration among modern equipment

While IIoT is being projected as an emerging technology, most of the technologies that are needed to enable IIoT is already in existence, and does not require any major technology breakthrough. These include technologies such as intelligent sensors, connected (wired or wireless) networks, big data and analytics, along with cloud computing platforms.

For deriving maximum business value from the adoption of IIoT, manufacturing companies face the challenge of being able to acquire and integrate the individual components, needed to successfully deploy an IIoT solution.

The emergence of Managed Service Providers (MSP) has enabled the widespread use of IIoT through service-based solutions aimed at front-end deployment, administering of manufacturing operations, along with identifying the right components for a specific business objective or case study.

Components of IIoT

The IIoT system primarily consists of the following four components, namely:

  • Intelligent assets
    • This includes a variety of physical assets including sensors, motors, and other instruments, which provide valuable business data. Intelligent assets can generate data of business value, which can then be shared across the manufacturing value chain.
  • Data communication infrastructure
    • In order to handle the massive data generated by intelligent assets, data communication infrastructure between the assets is a vital component. Data networking technologies such as IEEE 802, Wi-Fi, and cloud-based connectivity are key elements towards enabling this component.
  • Analytics
    • This is the IIoT component that converts the data into knowledge. Analytics tools such as predictive analytics enabled the creation of insightful business information, which can lead to innovative business models.
  • People
    • Even with the advent of machine learning and data analytics, people are a critical component of IIoT to write the correct algorithm to enable each of the above components. Additionally, business executives are also needed to make business decisions, based on the intelligent information generated by IIoT.


About Managed Service Providers in the IIoT space

Setting aside cost factors, most manufacturing companies face the challenge of identifying and implementing the right IoT-based solution for their business requirements. Managed Service Providers (MSPs) can be tasked with identifying the right IoT platform, the most efficient combination of IIoT components, right souring partners, and bring in the right talent to evaluate, acquire, and deploy IIoT-based solutions. 

According to a recent survey conducted by Techanalysis Research, information technology (or IT) projects comprised of only 33% of the IoT projects in small to medium business enterprises, while the remaining 67% of the projects were centred around manufacturing, operations, line-of-business, and business strategy-centric projects.[4]

With the IoT managed services market expected to grow from a market value of $21.85 billion in the year 2016 to $79.6 billion (by the year 2021) at a CAGR of 29.5% annually[5], MSPs become the key enablers and orchestrators of the IoT ecosystem managing all aspects from device and connectivity management, data gathering and analytics, training IoT professionals to managing large facilities where IoT-solutions have been deployed. 

As an IOT service provider, MSPs can provide a variety of capabilities, including:

  • Developing and deploying a scalable value-added platform, which can derive valuable insights from the generated data.
  • Selecting or building an IoT-enabled cloud platform to manage their service offerings.
  • Defining a partnership-based ecosystem, particularly for specialized vertical markets or service offerings.
  • Implementing large-scale IoT offerings that can be closely integrated with legacy systems and future data sets to derive maximum Return on Investment for the business
  • Factory and Business interconnect services AKA known as “Factory Connectivity” services to establish a real time connectivity between shop floor machines and IIoT platform.

When compared to other IT solution providers, IIoT MSPs need to partner with manufacturers to expand their offerings over (and above) traditional IT products or solutions towards the purpose of building and managing industrial automation systems. This could include modifying a device’s embedded operating system or offering remote monitoring and management products.

Smart Manufacturing using IIoT

  • IIoT-based technologies can drive the emergence of smart manufacturing with the following distinct operational environments:

Smarter enterprise control

  • Closer integration of connected machines and manufacturing assets will facilitate flexibility and efficiency, resulting in manufacturing with higher profits. Smarter enterprise control benefits manufacturing through the elimination of enterprise silos. The networking of the production systems with ERP systems, PLM systems, and supply chain management systems will provide an efficient holistic view of the manufacturing processes.

Asset performance management

  • The deployment of effective tools for asset performance management such as cost-efficient wireless sensors and cloud connectivity tools will enable efficient data gathering from the field of operation, resulting in an informed decision-making process. The growth of wireless connectivity and cloud solutions has eliminated the limitations of physical cable connectivity, thus enabling real-time decision support and remote monitoring.

Augmented operators

  • Following the retirement of the baby boomer generation, younger workers in the manufacturing space will increasingly depend on personal devices for critical information. Employees of the future will augment the use of mobile devices and augmented reality to improve their productivity. With this delivery mode of real-time manufacturing-related data, manufacturing facilities will evolve into becoming more user-centric and less machine-centric.



Thanks to its tremendous benefits, IIoT-based technologies will continue to be adopted as a means of maximising revenues and productivity by manufactures from different industries. According to industry estimates, around 46% of the global economy is expected to benefit from Industrial Internet.[6] With an estimated 30 billion devices likely to be connected to the Internet by the year 2020, enterprises and service providers will also need to address risk factors associated with the rise of IoT, including privacy concerns and cybersecurity measures.

Along with the business value of IIoT for manufacturing enterprises, today’s professionals also need to equip themselves with knowledge and skills of IIoT to maximize its complete potential and benefits.









Disclaimer: The information and views set out in these blogs are those of the author(s) and do not necessarily reflect the official opinion of Microland Ltd.