The Industrial Internet of Things (IIOT) adds sensors to machinery like airplane turbines, tractors, conveyor belts, and more, and connects them to automation services, predictive maintenance tracking software, and other analytics services.
To help understand exactly how the IIOT works, let's take a look at three key benefits of implementing Industrial Internet technologies. Innovative ways to track and analyze equipmentWhile predictive maintenance is a great way to use sensors for the Industrial Internet of Things, other companies are using them for real-time data tracking. Michelin's innovative sensor and analytics solution is a prime example of upgrading age-old industrial equipment (tires!) with an Internet-related solution.
Slow and steadyOf course, not all companies see the benefits from the Industrial Internet right now, and there are likely many companies that cannot afford to invest in new IIOT services even if they did. With this in mind, let's take a look at five ways the industrial Internet could make General Electric a more profitable company.
Industrial Internet and productivity At heart, the industrial Internet is the embedding of Internet-enabled devices within hardware solutions.
The example above focuses on the customer; however, consider that General Electric is also a major user of the industrial Internet in its own operations. Retaining customers Another aspect of the increased interoperability that the industrial Internet brings is the potential for an increase in customer retention. Moreover, General Electric's management believes Predix will "drive the next phase of growth for the Industrial Internet and enable developers to rapidly create, deploy and manage applications and services for industry." The more applications and services designed on Predix, the more customers will want to use the platform. The takeaway All told, the industrial Internet is exciting conceptually, but it also has the potential to help increase sales and margin at General Electric. But for companies looking to lead the next wave of industrial advancements, the Internet offers much more. By its most simple definition, the Industrial Internet of Things allows companies to automate systems, analyze data, and use sensors to improve efficiencies and increase revenue.
And Accenture research shows that the value from Industrial Internet of Things technologies and services could bring in up to $15 trillion in global GDP by 2030.
In other words, the long-term value in making an initial sale is likely to go up with the industrial Internet. In addition, retaining customers and increasing services revenue should be easier with the Predix platform, and the company can utilize the industrial Internet to increase productivity in its own operations. And with worldwide spending for the Industrial Internet of Things expected to hit $500 billion by 2020 -- up from just $20 billion in 2014 -- it won't be long before many companies in the sector start diving in.
Indeed, at the recent Minds + Machines event, CEO Jeff Immelt outlined how the company had generated "$400 million of internal productivity on our analytics," which he expected to grow to $1 billion. Moreover, since its services revenue tends to be higher-margin, the industrial Internet could result in increased operating margin for the company.
Regardless, the consumer market is brimming with products connected by the Internet of Things (IoT).
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