Building your Industrial Internet business case

Manufacturers face three challenges around their adoption strategy for the Industrial Internet of Things: board-level buy-in, integration, and security.

The Industrial Internet of Things (IoT) represents a tantalising prospect for manufacturing management teams, a proven way of gaining greater visibility, improving efficiencies, increasing business agility, and boosting margins.

Many of the underlying technologies may have been around for decades – actuators, sensors, communication protocols, data routing, enterprise applications; but what has fundamentally changed is the cost and ease of access.

The cost of storing and moving large volumes of data is now measured in pence thanks to the rise of off-premise data centres and edge and Cloud platforms; intelligent algorithms and AI now shoulder much of the heavy-lifting around processing and making sense of this data; and mobile devices like smart phones, tablets and virtual reality headsets make accessing and visualising these insights easier than ever.

There are numerous examples of manufacturers – of almost every size and sector – who are already deriving tangible value from the Industrial Internet; yet there are still many organisations who have yet to begin drawing up their strategy, let alone take those all-important first steps.

The Manufacturer’s research of the sector and conversations with senior executives would suggest there are three distinct yet interrelated challenges. To learn how to overcome these barriers, The Manufacturer recently spoke with Steve Fearn, chief technologist at HPE.

What’s the secret to gaining board-level endorsement?

Steve Fearn: Learning to speak ‘executive’. Executives, for the most part, don’t like presentations or briefing documents written in complicated information technology [IT] or operational technology [OT] language. They don’t understand the jargon and, to be honest, they really shouldn’t need to.

Think carefully about who your audience is, what factors are important to them, what constitutes an opportunity and what constitutes a threat. Make sure your proposition is commercially focused and that any initiative properly aligns with any wider business strategies or investments that may already be in place or planned for the future.

Developing a comprehensive, fantastic IoT strategy is great, but if it doesn’t match the overall business strategy then it’s a complete waste of time.

The other thing to consider is that executives typically think three to five years out. Yes, operationally they need to keep the business running and salaries paid in the day-to-day; but in my experience, they are always looking at the bigger picture.

That means your proposition needs to have a proper planning horizon, one which ties in with any product developments, supply chain modifications or changes in distribution that the business has planned for the next couple of years.

Pipe line conection in oil refinery - image courtesy of Depositphotos.Click here to read the story of Texmark Chemicals, a small, family-run petrochemicals company which has built the ‘Refinery of the Future’ by successfully overcoming the three barriers discussed in this article.

Integrating new systems can be particularly challenging for manufacturers because of existing enterprise software such as ERP, MES, SCADA, FSM and CRM. What advice can you offer around integration? 

I agree, most manufacturers are fairly heterogeneous on the shop-floor and these applications do offer a kind of nervous system for organisations.

I would certainly suggest you consider how to integrate the IT into the OT, rather than vice-versa. OT systems tend to have a longer lifecycle than IT, and most IT systems can integrate in a variety of different ways and formats.

Therefore, your real challenge is taking what the OT equipment is capable of and developing an integration strategy that will meet that, rather than focusing on the IT side of things.

Where that approach doesn’t work is when you have a machine which represents hundreds of thousands of pounds, say, but it isn’t capable of talking a more modern protocol.

That piece of equipment might be pivotal to your operation, so it absolutely needs to be part of your integration strategy. In cases like that, I would suggest taking the opposite path – i.e. integrating the IT into the OT.

The most important thing is that you don’t need to have everything in place before starting. Your integration strategy may only provide limited connectivity at the beginning, but that may be enough for you to get by and then dovetail into an existing investment programme or product refresh cycle that provide a foundations to progress to a broader integration.

Finally, it’s a team sport. If you try and let one function drive the integration, you’re going to end up with a very skewed view. This is much more than IT and OT, you need to talk to supply chain, finance, sales, customer service and really make sure that you have a solution that will provide the functional benefits the whole business can leverage.

What about advice on creating an actual integration strategy? 

Unless you’re a ‘unicorn’ company with no baggage and limitless resource, then these things typically happen in stages. Due to the existing software systems we’ve just mentioned, most manufacturers simply can’t afford to rip everything out and start again.

For me, integration strategies are exactly the same as product recycles and service delivery strategies. You might decide that you’ve got limited resources but a short time horizon, so you would go for a minimal viable product [MVP] approach – i.e. it has a fairly limited feature set, it can operate in a specific envelope, but it generates momentum.

Once you’ve delivered proof of concept, then you can move forward and start enhancing your integration.

It really depends on the culture of the organisation. Some manufacturers prefer a ‘leapfrog’ approach for example, where they’ll cut-back investment in some areas in order to take a large technology jump.

If you’re not careful, ‘big bangs’ can end up in quiet whimpers, but it will move things forward more quickly. The downside is that there’s obviously a greater risk of disruption to your organisation or customer service.

Fundamentally, you really need to think carefully and deeply to ensure that your implementation strategy is appropriate to your organisation.

When discussing the Industrial Internet with manufacturers, its’ not long before the topic of cybersecurity crops up. What’s your perspective?

Your system will never be 100% airtight and insurmountable; the only way to achieve that is to disconnect it from everything. However, then it has no value. Security has always been a balance between access and control, but here’s some advice.

First, get control of what you already have. I’ve been around a long time and I’ve never visited an organisation and they’ve known exactly what they already have, particularly on the shop-floor.

Second, understand your connections. Too many manufacturers have operational connections that they’re completely oblivious to. Let’s use a piece of equipment supplied by a European heavy industrial manufacturer five years ago as an example.

As part of their service strategy, the European company monitors your machine 24/7, but the company gets hacked. Because the connection between your machine and their network isn’t protected, your systems are as open as theirs.

In that scenario, your business is completely vulnerable. So, don’t just consider your own equipment, but any third-party access and whether that needs to be controlled, or is it even necessary?

Third, understand your data landscape. Many people belief that all data lives within the IT function. That isn’t the case; lots of different OT functions hold data stores. If you manufacture something that can potentially impact people’s safety, then you’ll need to keep detailed records of the controls and process you’ve got in place.

If exposed, that data could not only potentially be commercially damaging, but health damaging. Therefore, you’ve got to think carefully about your data, and if you don’t already have one in place you need to implement a lifecycle policy for your data.

Fourth, if you don’t already, you need a common IT and OT data security strategy. These things have got to work together. The individual policies may have to be developed within the IT or OT world because of functional requirements, but the overall framework must incorporate both together. If not, you’ll never create a secure environment.

Outcomes trumps technology

Digital Transformation - Alan Smalley, Pointnext Intelligent Edge Lead at HPE,

Embarking on a digital transformation journey has been described as ‘overhauling a railway network without the luxury of being able to stop the train service’.

To uncover some useful pointers as to how to manufacturers can kick off their digital transformation, The Manufacturer recently sat down with Alan Smalley, Pointnext Intelligent Edge Lead at HPE.

Click here to watch the resulting short video.