How to Measure Your Industry 4.0 Investment

How to Measure Your Industry 4.0 Investment

Industry 4.0’s inherent future-forward benefits are driving innovation across the industry and disrupting outdated processes across value chains. With every new Industry 4.0 technology that emerges—from IIoT analytics to artificial intelligence and AR—it becomes ever clearer that Industry 4.0 is not just an opportunity, but an imperative. This innovation enablement makes it even more crucial for manufacturers to pay careful attention to how IIoT and AR technologies can support their business objectives—or they risk being left behind not just by their direct competition, but by an entire industry-shifting movement.

The Challenge of Quantifying Industry 4.0 Value

Increased productivity, lower production costs, faster time to market, and the ability to quickly and profitably respond to changing consumer demands are the most-touted benefits of Industry 4.0. And with such significant business outcomes, Industry 4.0 is a compelling venture—but one that still requires a credible cost analysis. Unfortunately, the intricacy of the manufacturing industry, along with the soft ROI of IIoT and AR , makes it difficult to fully quantify the direct value of Industry 4.0. How do you measure the value of “increased market flexibility,” for example? Or predict the future value of innovation enablement?

Value Analysis: Traditional Manufacturing vs. Industry 4.0

The best way to determine the quantitative—and qualitative—value of your specific Industry 4.0 plan is to work with industry experts who can help analyse your business objectives from an Industry 4.0 framework, how they are likely to evolve in the future, and what digital transformation strategies best align.

Industry experts can provide insights into IIoT and AR technologies and how manufacturers with similar challenges to yours are deploying Industry 4.0 to gain business value. Their methodology is specifically designed to help you determine the most strategically valuable Industry 4.0 path for your unique business needs—in both the shortand long-term—as based on industry experience, analyst research, and use cases.

Based on InVMA’s experience working with our customers and industry leading organisations like PTC, we believe that the average manufacturer making $1 billion in annual revenue can expect to save between $2.6 million and $5.6 million, depending on a variety of factors. These savings are achieved by preventing unplanned downtime, increasing asset utilisation, and enabling real-time, role-based visibility.

Traditional Manufacturing Challenges

Unplanned Asset Downtime Unplanned downtime is one of the costliest drains on manufacturers. No matter the cause of downtime, the snowball effect on production process is immediate. And over the long-term, downtime can impact equipment’s lifespan, reducing overall plant floor return on assets (ROA). Most plant floor maintenance activities consistently take place on a planned schedule, whether they are needed or not. Or worse, maintenance only occurs when a machine breaks. But this approach is hard on machines, wasteful of time and resources, and lowers your plant floor ROA as it regularly requires machines to be taken offline—whether or not maintenance is needed imminently.

Limited Visibility into Asset Utilisation Siloed and inaccessible asset utilisation data hinders visibility into operations. This makes scheduling difficult and creates unnecessary downtime.

Industry 4.0 Approach

Predictive and Prescriptive Maintenance Understanding the different failure modes of machinery is the best way to prevent machine downtime. IIoT systems enable maintenance to be performed only when it is truly needed, preventing downtime and increasing ROA. IIoT solutions can gather information about device and equipment states, temperature, speed, vibration, individual components, and other objective data for an integrated look into a machine’s health and performance in real-time. This data, combined with powerful analytics, can be used to prevent downtime by predicting what maintenance is needed and its potential impact. AR experiences can make it even more useful by incorporating step-by-step instructions—faster than with a printed manual or video—so workers can address the problem quickly and safely.

Real-Time Data for Real-Time Flexibility By providing greater visibility into the myriad of value chain activities, Industry 4.0 solutions coalesce data for easier and faster analysis. Technicians have real-time visibility at all times, which gives them the flexibility to respond immediately and effectively to any transpiring value chain events and increase asset availability.

Real-World Results*

*Based on ThingWorx customers.

Predictive, Real-Time IIoT Maintenance Reduces Downtime Losses by More Than 40,000€ Per Minute A large German automotive manufacturer uses IIoT to create role-based production line information. Maintenance teams get real-time information on any low performing or failing component and can immediately pinpoint the exact maintenance need. 

91% Accuracy in Predicting Alarm States In a similar use case, a large automotive tier one supplier was able to develop new models that could predict alarm states with approximately 91% accuracy. Technicians are now able to be more proactive with maintenance and prevent downtime, rather than react to it.

Sophisticated Data Analysis Eliminates Need for New CNC Machine Investments; Historical Data Drives Improvements HIROTEC collected and analysed real-time and historical in-depth data to improve inefficiencies. Along with process improvements, HIROTEC fixed other bottlenecks that resulted in removing the need for a new CNC machine investment.

Beginning Your Industry 4.0 Journey

Industry 4.0 is disrupting manufacturing enterprises around the world. A focused and accurate value assessment is the best way to ensure that you get the most value out of these revolutionary tools—both in the immediate results and long-term scalability. These value analyses are only starting points. With a focus on your specific business objectives, an industry expert can help you balance the immediate value and long-term benefits of Industry 4.0 initiatives.

Read about our Innovation Sprint

Quantifying the Business Case for the IoT

Companies today are under tremendous pressure to deliver a higher quality of products and services at lower costs. Any expenditure companies do make is expected to deliver a measurable ROI. For product manufacturers in particular, ROI has traditionally translated to “reduce costs.”

However, cost is just one piece of the ROI equation. The IoT is creating new opportunities for companies to enhance their services, gain business insights, improve processes, and differentiate their offerings. In this ebook, you’ll learn;

  • Metrics for integrating smart, connected product data,
  • Translating product data into value,
  • Connecting data and business process efficiency,
  • Differentiated products that change the customer experience.
Required
Required
Top