The Industrial Internet of Things (IIoT) is an extension of the usage of the internet of things (IoT) in industrial sectors. In simpler terms, IIoT makes for a smart manufacturing environment using a fully connected, transparent, automated and intelligent setup, giving enterprises better efficiency and reliability in their operations. In the past decade, the concept has picked up pace in regions like North America and Asia Pacific, followed by European countries. As of 2019, the US was responsible for 35.7% of global IoT spending followed by Asia Pacific (27.3%) and Europe (23%). By 2024, Europe expects to see a growth of 24% in global IoT spending, whereas, North America and Asia-Pacific will have lower annual growth of 11% and 13.2% respectively.
Covid-19 and its impact Given the unprecedented nature of current times, IIoT promises to help enterprises navigate through a series of crises: ensuring business continuity during Covid; returning to business with increased flexibility to help them thrive in the 'new normal'; and lastly, improving and adapting businesses in a world changed by the pandemic. According to the Vodafone 2020 IoT spotlight report, 84% of companies that had begun to adopt IoT tech found it positively impactful for their business during Covid-19.
The global IoT market is expected to grow even faster than expected once the world enters a new post-Covid-19 business environment, with the release of pent-up demand and new technology investments to minimize impacts from future disruptions. According to a World Economic Forum report, the industrial IoT market to grow at a CAGR of 16.7% to reach USD 263.4 billion by 2027, driven by applications such as industrial automation and predictive maintenance. Enterprises will increase automation investments for future-proofing against pandemics and increasing resilience. It would not only decrease the time taken for the development of vaccines but also equip different industries to operate in full swing through remote operations. The digitization of manufacturing enterprises will also give them proper bandwidth to recalibrate production as per the demand at that point in time.
Indian IoT Market India too poses an incredible opportunity for the digitization of manufacturing industries. Our entry may have been late, but the rate of technology adoption has been enthusiastic across industries. As per Deloitte's recent survey, the Indian IoT market was expected to grow ~7x to USD 9 billion by 2020 which is drawing attention from leading players of the IIoT world.
However, there are several hiccups on India's road to implementing IIoT in its industries. For example, large telecommunication companies with network ownership have the capabilities to adapt to an IoT workflow, but they still need to deal with several critical challenges such as standardization, interoperability and data security.
Meanwhile, the challenges that manufacturing industries could face while deploying IoT in their frame of working are:
Defining new business models/strategies
Conducting successful pilots as tech could come at a high price
Interconnection of all departments
Recruiting and developing new talent
While Industrial IIoT holds immense promise for India, there is a need to ensure governance, process, infrastructure and planned deployment in order to begin to reap the full benefits. The digitization of manufacturing enterprises will also give them a proper bandwidth to recalibrate production as per the supply chain at that point in time.
Government's investment Despite the challenges, the prospects for IIoT in India are limitless. With the government's ambitious Smart Cities Mission coming into the picture, IoT adoption could be seen happening across industries such as utilities, manufacturing, automotive and transportation & logistics. Developing homegrown smart solutions is also one direction that the government could explore. Launching grants in institutes like the IITs in collaboration with companies could lead to creating a pool of in-house experts.
Currently, there are five key segments contributing to the overall IoT market demand in India " global capability centers (GCCs), large enterprises (LEs), small and medium businesses (SMBs), consumers, and the government. There are over 1,200 public-listed LEs in India, with a current IoT adoption rate of around 35%. This is a likely great start to an automated and more reliable ecosystem that will help Indian enterprises to stay globally competitive and realize the government's vision of becoming 'aatma nirbhar' (self-reliant).
Advantage India As more Indian factories and warehouses start implementing IIoT infrastructure and the government provides equal amounts of support, IIoT and digitalization could help us harness greater agility and efficiency. Enterprises can reap several benefits including:
Reducing short-term costs by digital performance management and remote assistance
Better connectivity within the supply chain
Ensuring employee safety and security during situations like a pandemic
By creating a digital foundation, industrial automation will increase productivity and performance and unlock India's potential of becoming a manufacturing hub.
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This is a partnered post written by Mr Rupinder Paintal, Director - Market Development, ExxonMobil Lubricants Pvt. Ltd.