Brick and mortar stores are in a steep decline. Every day we hear about another chain closing down dozens of retail outlets and at the same time malls are being shut down or repurposed. Shopping patterns are changing rapidly. We no longer go out to shop. We check out products, compare prices and do a one click purchase from our cell phones. And after we click we have an expectation that the item will be delivered to us in a day or two. It is not uncommon to get an email or text saying our item has been shipped less than an hour after we place the order.
There has always been an element of service as a product but it is accelerating in recent years and may become the dominant method of delivery for sophisticated goods over the next several years. The question being asked by manufactures is, do consumers want a “thing” or do they want the service that the product delivers? Do consumers want to buy a device and use and maintain it or would they prefer to pay for the actual use they get from it? A traditional example of this was the car lease. Consumers get a car to use and effectively pay for the miles they drive. The repair and maintained costs are covered in the lease fee paid. The same concept can now be applied to almost anything a consumer uses. As the Internet of Things has become more robust it has made it possible to monitor more closely the operation and failure of appliances, and to do predictive and preventive maintenance.
As we erase the mismarked year on our check book (scratch out 2016 and mark down 2017), it's time to reflect on where things are headed for the new year. Many believe it is going to be about “digitization" or adopting recent IT technology to maximize digital resources. Each market space has its own take on it.
The Internet of Things or IoT has been around for a long time but it has only recently reached mainstream as a term so that a majority of the population, if not everyone, knows something about what it means. There is a unique version of the Internet of Things known as the Industrial Internet of Things (IIoT) or Industry 4.0.
This past weekend we as a nation celebrated Labor Day. Americans observe Labor Day partly as a tribute to those who came before us in the workforce who established principles for equitable pay, safe work environments and reasonable conditions, and other improvements as new paradigms emerged.
Of course Labor Day is also the traditional beginning of fall and the end of summer so it’s a good time to take stock of things, and we look here at the role and value of "labor" which today is a lot different from where it was 100 years ago in part because of the efforts of those early pioneers of workers rights and the dawn of the new modern industrial age.
I'm fortunate to again be attending NIWeek, the annual business and technology conference run by National Instruments (NI) in Austin, Texas. It's a scene of thousands of engineers, scientists, and businesspeople converging to look at the latest and greatest technologies, applications, and success stories while also having the opportunity to learn new techniques and advance our prowess.
We hear a lot about hacking into networks these days. Most recently the news has been about email and email servers. But hacking is hacking and if someone can figure out the passwords and break through the security for an email server there is no reason to believe that the same hacker can’t break into the server in a pharmaceutical plant, water treatment plant or power generation plant. We don’t spend a lot of time worrying that Wiki Leaks will get data on hacking into one of these but some of the more serious international competitors might. We wouldn’t be surprised to hear a news report that says China, Russia, Korea or Iran had hacked into a manufacturing facility and shut it down, or worse yet kept it going but created a dangerous condition for either the plant or the products they produce.
The Smart Factory, the Industrial Internet of Things (IIOT), being “connected”... All these terms and topics are driving manufacturers to consider new and innovative ways to tie together their assets, and make their processes more safe, agile, and productive. The bottom line: realize greatly reduced costs and dramatically increase profits. You might consider this a mythical “Holy Grail,” but it's on everybody's to-do list and you better believe it's possible. Not only that, your competitor is doing it right now.