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The state of the IIoT: Adoption hurdles and common pitfalls

05 June 2019 Preston Reine

At a time when many industries are embracing change, adopting new technologies in quick succession, and asking "what's next?," manufacturing technology and industrial automation equipment are quite the opposite. The disruptive and rapidly moving technologies of the Industrial IoT (IIoT) have yet to find steady ground in this slow-moving, mature market. IHS Markit is looking closely at the adoption and penetration of IIoT in manufacturing and industrial automation, identifying adoption hurdles and common pitfalls in the case where some companies have taken it on.

In the recent IHS Markit Industrial IoT Readiness Survey, we found that 50% of respondents had not begun adoption of IIoT solutions. This figure is staggering compared to the adoption of disruptive technologies in industries such as telecom and automotive. In one example, a global vendor performed an IIoT application trial run with a customer, saving them thousands of dollars and demonstrating a significant ROI. However, it took the customer another three months to fully commit and implement. This is not an uncommon story in this space.


Big data can cause a lack of focus

When examining this reluctance to adopt and adapt in the manufacturing space, we made an initial assumption that cybersecurity was the most significant hurdle. Yet, when we conducted the survey, we found the largest concern among companies was the data itself; so much data is being collected, yet it is unclear what to do with it. When faced with thousands upon thousands of data points, many companies are simply overwhelmed with deciphering what is crucial and what can be ignored.


The influence of an industry culture

In addition to the confusion and sense of being overwhelmed by too much data, a common pitfall in IIoT application adoption in manufacturing is culture: 60% of implementation failures stemmed from a cultural problem. To us, this means the "people problem" must be addressed first and foremost. Employees often fear being replaced by automated systems, and they do not trust the application or the technology. It is crucial for companies to hire and train personnel properly and focus on the application itself. The application must be user-friendly, employees must trust the information produced by that application, and they must hold the view that the technology is enabling them to perform their role more effectively instead of threatening it.


The ripple effect of a transformed culture

When the culture shifts, we believe it will create a ripple effect of positive experience in the workplace, bolstering adoption and effectiveness. When employees understand and trust the data, it will be clear what data is sacred and, in turn, eliminate the sense of being overwhelmed. As it stands, manufacturing and industrial automation are behind the curve, but our analysis shows us that fully embracing the IIoT is possible and on the horizon with a concerted effort to educate and train the people who will ultimately make it work.


Preston Reine
is research manager for industrial technology at IHS Markit
Posted 5 June 2019

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