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Internet of Things

The Internet of Things (IoT) refers to a network of physical devices or machines that are networked together to exchange data. These everyday objects include smartphones, smartwatches, cars, refrigerators, heating thermostats, and manufacturing machines. These machines or devices are equipped with intelligent sensors, chips, and software. The communication between the individual devices is therefore intelligent or smart. In the private sector, these intelligent devices are called smart devices, and the entirety of the devices in combination with each other is called a smart home. For example, a radiator can be equipped with an intelligent thermostat. The thermostat is connected to the home network via WLAN and programmed by the user via software. It allows the heating output of the radiator to be controlled smartly. Smart communication with machines is also taking place in the industrial sector. In the industrial sector, the Internet of Things is called IIoT, which stands for Industrial Internet of Things. In Germany, the IIoT is often known as Industry 4.0. In logistics centers, for example, packages are sorted accordingly with the help of robots. In Industry 4.0, however, it is not just individual production steps that are smartly interconnected, but entire supply chains.

How does the Internet of Things work in tomorrow’s smart factory?

When people talk about Industry 4.0, they also mean the “smart factory“. The smart factory combines modern technologies to make industrial production flexible and self-adapting. The aim, roughly speaking, is to optimize the customer order process (KAP). Various processes combine to optimize the smart factory. On the one hand, there are Smart Products, which are about optimizing the product creation process connected with their products. Smart Services, on the other hand, are new business models. The idea of networked production is not new. The concept of creating networked production lines emerged as early as the 1990s. Today, the smart factory is the path to intelligent production, which drives the digital value chain (supply chain).

Smart Factory – Definition

Smart factories start with the product creation process. In the process, a digital twin of the new factory is created using digital factory methods during the planning and design of a new factory. Therefore, this digital twin is a digital image of the actual factory. In short, it can be said that the smart factory can make decisions for itself and organize itself.

Smart factory, Internet of Things, and other technologies

Smart factories have intelligent networking among themselves. They are equipped with various sensors, which enable communication between product and machine. This makes a highly automated and autonomous organization feasible. The systems act intelligently and constantly ensure that productivity and quality are improved. Mainly this is realized by a Cyber-Physical System. From the product itself, the required information is communicated to the digital factory. Based on this information, the individual production steps are controlled until the final result. Especially in the connection between the Internet of Things and the rapidly growing spread of 5G, many new possibilities for wireless communication within smart production are emerging. Another critical point in the interaction between the Internet of Things and the smart factory is predictive maintenance. The constant networking of devices with each other utilizing condition monitoring or predictive maintenance means that the devices are constantly monitored. Various sensors monitor the temperature, pressure, and acceleration of the machines, for example. In this way, the current condition of the machine can be monitored and intervened if necessary. If a part of the machine fails, it can be renewed in time before it creates an unplanned downtime that interferes with an order in production. It saves costs by eliminating unnecessary component replacement and order delays.

What role will humans play in the smart factory of tomorrow?

In the future, networked machines, devices, and robots will do their own thing in production. The degree of mechanization is increasing more and more, and complete manufacturing processes will run independently. That raises the question of what role humans will still play in the smart factory of tomorrow? But despite increasing mechanization, humans will continue to play a significant role in the future. Although they no longer have to intervene in the actual manufacturing process, they still control and optimize the processes that lie within their range of tasks. Furthermore, the employee decides on the interfaces to external systems and the design of the smart factory.

What does Lean Management mean? A definition

Lean management means that processes are optimized to be as lean as possible. In doing so, company processes are optimized to the extent that their added value is maximized and losses are kept as low as possible. Another advantage of process optimization is that employees can find their way around day-to-day business more efficiently and train new employees more quickly.

Internet of Things and lean processes

How do you combine lean processes with the Internet of Things?

Lean management became known primarily through the Toyota Production System and is closely associated with the term Industry 4.0, in which business processes are digitized. Digitalization is also viewed as a process. However, the digital process is not a process designed to produce fixed results. Instead, it enables transformable business processes. The previous business processes are replaced by digital technologies, intelligent objects, and the networking of individual objects across the entire business processes. Networking forms the basis for decentralizing the units of companies. This ensures that it will be possible to respond to the rapidly changing requirements of customers in the market in the future. This results in higher productivity. That is why the focus today is increasingly on the interaction between man and machine. The IoT ensures sustainable development between people and their environment. In this context, IoT devices and components are integrated into business processes. Devices are thus able to conclude contracts (smart contracts) as well as trigger multi-stage processes. VW, for example, has introduced a lean transformation concept. With the help of the lean strategy in combination with the Internet of Things, the entire value chain, starting with vehicle development, through manufacturing and logistics, to sales and trading, was optimized.

The Lean Startup Concept – Digital Transformation as the ideal foundation for Startups

Eric Ries introduced the Lean Startup concept in 2011. Here, the experiences of various startups were being compiled in search of a profitable business model and a growth strategy. The great value besides the lean management principle is that innovation processes are made measurable and thus controllable. This is done with the help of the Internet of Things.

A newly founded company looks for new digital products, services, and business processes in the early stages. Devices and machines that are networked with each other are used as early as possible. However, the lean startup concept can negatively impact an already established company because there is a great deal of freedom in the search for a suitable business model and experimentation with developed products in the lean startup model. However, if methods from both worlds, i.e., from established companies and startups, are combined, digitization can be transformed into a safe and promising process.


What advantages do lean processes bring in combination with the Internet of Things?

At many companies, production systems are often very theoretical and not very practical or outdated. Improvement routines also focus on internal optimization instead of market and customer requirements. For companies to keep up with the digital transformation, it is essential to take advantage of Lean processes with the Internet of Things. These include:

  • Higher response speed with shorter lead times and more stable processes.
  • Individual customer requirements can be met more flexibly and thus more economically, while quality standards remain high.
  • Strengthening of own competitive position
  • Horizontal and vertical networking via global production networks

M2M plant monitoring – how intelligent communication in production works with the IoT

The use of machine-to-machine communication (M2M communication) has revolutionized the industrial sector for some time now. Des opens up unimagined, new possibilities. By using modern systems in manufacturing plants, it is possible to perform machine processes without human monitoring or control. The required data is collected and evaluated through remote monitoring, making it possible to adjust appropriate parameters automatically.

What does M2M mean in-plant monitoring?

Machine-to-machine communication involves the automated exchange of data. Objects such as machines, vehicles, robots, servers, end devices, or even complete plants come into question. The individual components, which are networked with each other, communicate with each other via radio technology. The actual transmission of information takes place without human intervention. However, interfaces can be integrated to pass on essential data to the service team or the control center.

What are the advantages of M2M communication in plant monitoring?

When machines and control centers communicate with each other at all times to exchange data, this brings significant benefits. For example, workflows can be optimized or streamlined by having components available at precisely the right time at a specific location. As a result, inventories can be better managed. Besides, M2M monitoring eliminates the need for employees to be permanently present. Other benefits include:

  • Workflows are streamlined
  • Processes and equipment are maintained remotely
  • More flexibility for production
  • Preservation of evidence in case of defects or accidents
  • Critical conditions are permanently monitored
  • More effective workflows thanks to faster data transmission

How companies use the Industrial IoT

In the production environment, some heterogeneous machines and systems speak different communication protocols or, in some cases, were not intended for digitization. For a company to benefit from the IIoT, it needs an excellent database. The essential prerequisite for this is a connectivity solution that understands the different communication protocols and has access even to those machines not intended for digitization. With appropriate IoT gateways, these machines can become part of the Internet of Things. Companies can gain insights into production processes and realize visions of the future. In addition to connectivity, modern IIoT platforms offer application programming interfaces that enable collaboration between different software providers. The integration of existing systems and future applications is thus created.

Über den Autor

Victor Gruber ist studierter Betriebswirt und hat nach seinem dualen Studium bei der FORCAM GmbH bereits mehrere Jahre Erfahrung in den Bereichen Marketing und Vertrieb gesammelt.

Sein Interesse gilt insbesondere neuen Technologien und digitalen, datenbasierten Geschäftsmodellen. Digitale Transformation und das IIoT sind sein Steckenpferd.

Victor Gruber

Marketing Manager