IOT in Manufacturing : Benefits, Future and Case Studies


Business value with IOT in Manufacturing


  • What is the Internet of Things (IoT)

  • Benefits of IoT in Manufacturing

  • IoT in Manufacturing Case Studies

  • Future of IOT in the Manufacturing Industry

IoT Figure: Internet of Things (IoT) connected devices installed base worldwide from 2015 to 2025 (in billions) Source:

What is the Internet of Things (IoT)

The Internet of Things(IoT) is a network of connected devices which communicate over the Internet, and they do so autonomously, machine to machine, without the need for human intervention.

Industrial internet of things (IIoT).
The industrial internet of things (IIoT) is a term for all of the various sets of hardware pieces that work together through internet of things connectivity to help enhance manufacturing and industrial processes.


We hear frequently about Internet of Things (IOT), Artificial Intelligence (AI) and Machine Learning (ML) together. Many businesses are seeing the benefits of using these in a right way and make things happen. So many areas, we see the growth of Artificial intelligence and Machine Learning. Both are interconnected in a way, the machine learning can happen only with an intelligence built by a software. This software takes a huge amount of data as inputs, comes with patterns and arrives at solutions and the actions to take. So the question is how IOT in Manufacturing Industry works? What changes the businesses have to do to take advantages of IOT?

  • As part of ERP sales, we interact with many industry vertical leaders. Our experience with Manufacturing, Trading & Distributors, SOHOs, Service companies etc. help us to understand their inherent problems and how it can be solved with help of IOT.
  • Manufacturing sector is one of the industries that could exploit an opportunity to scale themselves by using AI and ML features. However this alone is not possible. We need to provide the data inputs from CNC or any other Machines to Data analysis points. This is handled with the help of IOT (Internet of Things) objects.
  • While the advantages are many, the cost to benefit has to be calculated. I have identified few use cases based on our experiences.
  • IOT in Manufacturing Industry: Production Planning
  • One of the major challenges in this team is the frequent changes in the demand and supply.
  1. How can you pass the information to CNC Machine as the demand changes? So that production work can be stopped and these components are moved to another place.
  2. How to ensure that the data is synchronised between the Planning and Production department?
  3. How to inform Purchase department to stop the PO or Inform Stores department on what to do?
  • Lets assume that we have fixed an IOT device to the production machine that passes the production details back to ERP.
  1. Based on the change in the demand or forecast, the Planning department will redo the Planning. Automatically these new instructions are passed to Production manager, materials request to Vendor with due date to deliver.
  2. Once the details are updated from Machines and Men, the planning will be completed.
  3. If any unscheduled maintenance comes, its identified and production schedule is redone.
  • IOT in Manufacturing Industry: Demand generation and alerts to Vendors on the quality of products
  • One of the problems that are faced in the Production and Planning department  is the quality of products / raw materials. Many of these issues would appear when we use them in assembly. Post-production the challenge is to transfer this information back to Vendor, so that his vendor ratings are reduced.
  • Stores department receives the materials against the Vendor documents and it can be traced back to the document, batch number etc.
  • As the production QUALITY IOT finds a problem with materials supplied, it has few options to do.
  1. Send the message to central unit on the Product quality issues
  2. Send the message to Production Manager, if the rejections are more than 10 numbers. Stop the production, if required.
  3. Send the message to Vendor with quality parameters and data etc.
  • IOT in Manufacturing Industry: Machine production reporting by cycle time.
  • Most of the production time, the quantity reporting is done at the end of the day or at the end of shift. This leads to problem where the immediate decisions are not taken for the production team and leads to more wastage and increase in the cost of production etc.
  • So an IOT interface can help to calculate the production Quantity, track the rejections and alert the Production manager etc. Some of the issues can be tracked and handled are
  1. How the materials are rejected?
  2. If the cycle time is increasing due to harden materials?
  3. Tool tips breakage and re usage is increasing.
  • IOT in Manufacturing Industry: Machine breakdown / Maintenance
  • Alerts with production planning and change in scheduling.
  • Let’s assume that one of the important machines that help to manage the critical production is down. Now this information should be made available to the service engineer immediately to take actions. Based on the message, he can begin his activities and fix the machine. These are mission critical operation and have to be done quickly.
  • Scanning and MRI machines are the best example for this.
  • Fix your product demo at your convenience.
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Nityananda Rao, (BE, PGDGM and INSEAD Alumnus), is the CEO of AcTouch Technologies with 20+ years of experience in ERP, Banking and Treasury Solutions. He is a Mechanical engineer who worked on shop-floor with CNC Machines, SP-300 like Injection Moulding machines. He is a authority on ERP and it's features. Prior to starting AcTouch Tech, he worked with Infosys, Misys, Murex etc managing APAC region as profit centre.