The Internet of Things (IoT) is often touted as the next phase of technological development, in which items like vehicles, HVAC systems, and even household appliances can communicate with one another, store information online, and take simple steps regarding their own function.
According to a 2016 Mackinac Policy Conference panel hosted by Tom DeVries, the IoT is poised to become big business, growing an estimated $2 to $4 trillion by 2020.
While a refrigerator that can remember the milk for you sounds like science fiction, smart technologies like these are increasingly becoming fact — and changing the face of manufacturing as they do it. Here, we explore some of the ways smart technologies and the Internet of Things are changing manufacturing in Michigan.
‘Seamless’ Innovation in Grand Rapids
Grand Rapids is poised to become a hive of IoT innovation in the next few years thanks to a smart tech-focused business accelerator that has the backing of six of the area’s largest companies, according to Joann Muller at Forbes.
The Seamless Coalition and Accelerator, backed by Rick DeVos’s Start Garden capital fund, brings together Amway, Faurecia, Meijer, Priority Health, Spectrum Health and Steelcase to create a business accelerator that will help startups focus on smart technologies.
“We really can’t replicate that entrepreneurial spirit,” notes Jim Keane, CEO of Steelcase, a company that has long sought to innovate office spaces. “There’s nothing like a person waking up with an idea and throwing their heart and soul into it.”
The sort of teamwork represented by Seamless is essential to success in the IoT sphere, according to Leslie D. Green of Crain’s. Green notes that while Michigan is well-positioned to take the lead in smart technologies, many organizations miss opportunities in the IoT sphere due to a lack of cooperation or a lack of understanding of the human element behind IoT.
While the Seamless Coalition and Accelerator attempt to address both problems, according to Jennette Smith, it’s not the only Michigan business venture that is doing so.
What Value Does IoT Bring Michigan Manufacturers?
Today, 20 percent of manufacturers note that their factory operations are offline-only, according to SCM World’s Kevin O’Marah — but “this will drop to near zero in five years.”
Why the change? In short, smart manufacturing and the Internet of Things provide benefits manufacturers can’t ignore. These tools make it possible to gather information in real time and turn it into actionable data — improving operations, supply chain, design, demand management and more.
“The hype of big data and machine learning is best converted into value through predictive analytics, using insight to better plan and execute operations,” notes DHL CIO Paul Richardson.
Analysts in the IoT sphere are already seeing the way in which these technologies have revolutionized supply chain management. Jeremy Coward lists a number of major companies, including General Electric, Bosch, Cisco, SAS, and DHL, already implementing IoT to create end-to-end supply chain efficiency.
Another revolutionary step IoT makes possible is the ability to control inputs, quality and inventory at the unit level rather than the batch level. According to SCM World’s Pierfrancesco Manenti, “technologies based on the Internet of Things have the potential to radically improve visibility in manufacturing to the point where each unit of production can be ‘seen’ at each step in the production process.”
When each unit can be reviewed individually, problems can be corrected more quickly and a higher quality of product can result — without spending additional time or resources.
How Michigan Manufacturers are Embracing IoT
Throughout Michigan, companies that manufacture and sell a wide range of products, from machine tools to office desks, are discovering how IoT can maximize their manufacturing, streamline their sales, and improve user experiences.
Ford: Continuing to Innovate
Perhaps the most iconic Michigan company to make connectivity the basis of its approach is Ford. “We’re moving from being just a hardware provider to being a hardware, software, and experiences provider,” notes Ford’s Connected Vehicle and Services head Don Butler. “The future is going to be different, and we are embracing that difference, and we’ll continue to be a part of people’s lives.”
Ford Motor Company isn’t new to manufacturing innovation. Henry Ford’s assembly line concept changed the way a number of consumer goods, from automobiles to household appliances, were produced. Ford’s embracing of IoT systems — also known as “Industry 4.0” — represents another step in the company’s commitment to improving manufacturing.
At Ford, IoT isn’t just part of the vehicles sold to drivers throughout the world. It’s also employed in engineering, manufacturing and supply chain management to ensure those drivers receive high-quality vehicles more efficiently, according to Chris Fischer.
The average person spends about 280 hours behind the wheel each year. Meanwhile, the increasing rise in productive pressure and the availability of connected tools mean that drivers can be more engaged than ever before. To balance the interests of drivers with the need for safety, Ford Motor Company has started using IoT not only in its vehicles, but also as part of its manufacturing processes.
The company also began testing self-driving vehicles in 2016, according to Andy Szal, joining companies like Google in the quest to leverage greater connectivity to improve safety and user experiences.
Ford even has plans to connect its vehicles to home IoT devices like Amazon’s Alexa or Google’s Nest, according to CEO Mark Fields. To achieve this goal, Ford has begun to embrace the concept of open-source IoT code — engaging directly in the kind of cooperation that the Seamless Coalition and Accelerator seek.
KUKA: Improving Manufacturing Consistency and Efficiency
Robotics giant KUKA, whose North American operations are headquartered in Warren, seized the opportunity to integrate IoT systems when the company built a new Toledo, Ohio, facility for manufacturing Jeep Wrangler bodies.
The system connects 259 assembly-line robots to other devices on the shop floor, including welders and sealers. Everything “talks” to back-end monitoring systems, and all robot control functions are available through a centralized interface.
“We ship our customers a complete car body every 77 seconds,” the facility’s managing director, Jake Ladouceur, told Microsoft, which provided the robotics interface platform. “We don’t have time to adjust source code, and we can’t introduce something that isn’t trusted and proven. Our intelligent system ... enables us to react very quickly.”
Herman Miller: Improving the User Experience
Meanwhile, at Grand-Rapids-based Herman Miller, the Internet of Things informs not only manufacturing, but the end-user experience as well.
The company’s Live OS desks connect physical workspaces to a cloud-based workplace system, allowing users to control desk height and other features, according to Kif Leswing. The system also allows managers to see how the workspace is actually being used, so that better decisions about efficiency, productivity, and health become easier.
Herman Miller’s interest in IoT stems in part from a longstanding passion of the company’s current head of design, Laurel Stanley. When Stanley began her career in the late 1990s, companies like Herman Miller were still debating whether they even needed a website. Stanley convinced Herman Miller — and Steelcase, Wolverine World Wide, and other West Michigan companies — that the answer to “Do we embrace this new technology?” needed to be “Yes.”
Looking Further: IoT in Retail and Supply Chain Revolutions
Even Michigan companies that don’t focus on manufacturing find value in manufacturing-inspired IoT applications.
For instance, Wyoming-based Gordon Food Service’s UX manager Kedron Rhodes has noted that the RFID tags allowing manufacturing machines to better understand, catalog and create each part can also be repurposed in retail, where the same RFID tags can be used to track individual products when the same underlying goal — greater efficiency — is pursued in both cases. “There’s no human involved in that but it’s definitely adding value,” Rhodes noted.
Moving Forward: Major Challenges and the Future of Smart Manufacturing
Investment in the Internet of Things by manufacturers is expected to top $70 billion by 2020, according to Business Insider’s John Greenough. Currently, manufacturers who implement IoT use it to track assets on manufacturing lines and in materials and storage facilities, gather data to improve maintenance, and monitor HVAC and other facility operation metrics to improve efficiency.
Greenough names four major barriers for manufacturers seeking to implement IoT: the risk of hacking, difficulties in evaluating return on investment (ROI), technical hurdles to integrating IoT into factories, and reluctance to implement measures that might result in job losses. These barriers, however, haven’t proved insurmountable for many Michigan companies, and their innovation may make it easier for other manufacturers to follow suit.
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