Leveraging Internet of Things (IoT) for Manufacturing

Between supply chain bottlenecks, labor shortages and a volatile global marketplace, manufacturers may find benchmarking operations and planning to be difficult. How do you measure efficiency? Where do you look for opportunities? What changes need to happen to know what your opportunities and challenges are and plan next steps? Is the thing you need the internet of things (IoT)?

According to a Manufacturers Alliance survey, 85 percent of manufacturing CEOs believe an investment in IoT, sometimes called smart technology, will help their business achieve more success in the future.1 But what is IoT, and how can it positively impact your enterprise?


In the most basic terms, IoT is a network of objects or “things” that connect and share data via the internet or cloud technology — creating a seamless exchange of information between people and processes. In turn, the insights these connections provide can be used for monitoring and automating a framework designed for a specific goal. In your home, IoT looks like speakers and lights that you operate via your smartphone, but manufacturers are now discovering how IoT applications can help them achieve scale for select processes with little hands-on management.

Seven Ways Manufacturers Put IoT to Work

Industrial IoT (IIoT) is gaining traction because cloud technology can help manufacturers apply wireless automation and control for certain systems — automation that can translate into savings and efficiencies. We’ve included several ways many businesses like yours are taking advantage of IIoT:

  • Equipment monitoring – The machines relied upon by many manufacturers are highly complex and operate at capacity for many hours. When breakdowns occur, there is an unexpected halt in production for an unspecified amount of time until the machine can be repaired. According to a survey by Information Technology Intelligence Consulting, 98 percent of enterprises report losing at least $100,000 per hour from machine downtime.2 IIoT allows entities to monitor equipment for warning signs and develop maintenance data to proactively address malfunctions before they occur, mitigating lost production time due to disabled machinery. According to one study, smart connectivity technologies help manufacturers add nearly $4 trillion in value.3
  • Operations improvement – Smart technology and integration can help automate operations that impact a manufacturer’s efficiency, including adjusting energy consumption for non-peak production runs or even turning off lights in areas when employees are not there. In addition, any aspect of operations that allows for connectivity of the devices to the internet for continuous monitoring can allow for improving performance, reporting outage and preventing costly repairs by embedding key performance measures, which can then alert operations personnel if optimal performance parameters are breached – for example, a machine’s temperature starts to rise, indicating system failure, or water sensor detects moisture indicating flooding or high humidity, etc.
  • Labor – Like many industries, manufacturing has a labor shortage. With IoT, management gains data for how to best optimize operations, focusing on the right number of skilled workers needed to improve output throughout production cycles. Additionally, IoT technology may help manufacturers discover functions and processes that can be automated so labor resources can be focused elsewhere. Some manufacturers are utilizing IoT technology to provide real-time feedback as they perform a task — information that can later be tailored to more robust and detailed training.
  • Production monitoring IoT is especially beneficial to manufacturers with multiple locations. The smart technology helps leaders understand performance across the enterprise, from monitoring output of multiple factories to specific equipment. Manufacturers can compare performance for specific projects and business cycles, discover and define anomalies and benchmark it against historical data. IoT even allows manufacturers the ability to make adjustments remotely, reducing the need to have technicians and foreman onsite.
  • Materials management – By connecting inventory data to sales and marketing data, manufacturers can use IoT to manage the purchase and use of materials to help prevent waste and costs associated with storing unused materials. Smart tracking technology combined with predictive algorithms can help manufacturers determine when and how much materials are needed based on a prediction of when customers will be submitting orders.
  • Vendor management – Using IoT to manage vendors helps manufacturers scale operations. Armed with data of how successfully a vendor does or does not deliver a product or service provides the manufacturer with critical information for budgeting, inventory management and customer fulfillment. This additionally helps detect, manage and reduce vendor risk allowing for a more robust vendor pipeline that is reliable and supplies quality products and services.
  • Supply chain optimization - By incorporating IoT into the supply chain network, manufacturers gain real-time data for operations like:
    • Number of trucks loaded
    • Delivery tracking
    • Real time status from distribution centers
    • Categorizing shipments by price and location
    • Inventory status and storage management
How DHG Can Help

To help you understand just how IoT concepts can benefit your organization today and tomorrow, look to the professionals at DHG. Our teams combine comprehensive insights on innovation with substantial experience in all facets of the manufacturing industry. This integration enables us to tailor an IoT strategy for your specific needs and help you navigate operations with more data and insights. To learn more, please reach out to us at analytics@dhg.com.


  1. https://www.manufacturersalliance.org/research-insights/ten-trends-shaping-us-manufacturing-next-twelve-months
  2. https://lanars.com/blog/iot-operational-efficiency
  3. https://www.manufacturing.net/automation/blog/21509245/how-machine-learning-is-changing-maintenance-operations


Amit Arya
Chief Data and Analytics Officer
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