Inforum Europe - IoT not yet a priority for Infor manufacturing customers

Profile picture for user slauchlan By Stuart Lauchlan November 4, 2015
Summary:
Having an hyped IoT angle on your keynote presentation is compulsory these days, no? Not so much at Inforum this week, but that doesn't mean that there's not some pragmatic thinking going on in this area.

It is of course by now traditional for all tech conferences to pay homage to the Internet of Things (IoT) and make bold commitments in that direction, regardless of the practicality of delivery on those.

But Infor is one company whose manufacturing and ERP footprint and history makes it a prime candidate genuinely to make a mark in whatever IoT economy takes shape in the coming years.

What is interesting - but hardly unexpected given the way the company is evolving - is the pragmatic view that Infor is taking here.

Far from bigging up the IoT as a ‘here-and-now-and-we’re-all-over-it’ phenomenon, the company chose its Inforum event in Paris this week to release the results of a study suggesting that the manufacturing industry is taking a careful stace on the IoT.

The poll found that only 10% of manufacturers reckon to have an IoT project underway, with a further 22% at pilot stage or planning to launch one in the next 12 months. Nearly a third - 30% - say they have no current plans in place around the IoT at all.

And despite the hype coming from certain over-excited analyst quarters, only one in 10 manufacturers see the IoT as a top priority, while 43% say it’s just not a priority at all.

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IoT's status over next 5 years

Now, the study doesn’t have the widest poll base - 137 responses from primarly North American manufacturers - but if its findings are extrapolated to the wider manufacturing sector, then the message is clear: these are very early days in the age of the Industrial Internet and there’s a lot of time to develop strategies here.

Or as Andrew Kinder, VP Industry & Solution Strategy at Infor, puts it:

With only ten percent [of respondents] claiming complete readiness, there is clearly an untapped opportunity ahead for companies with the right vision.

Benefits

Asked about the potential benefits of the IoT, 55% of respondents cite costs savings from greater operational efficiencies as the prime oppportunity, followed by 30% seeing increased competitive advantage through additional revenue from new service offerings.

Asked about specific potential benefits, increased productivity tops the list (20%), followed by better insight and decision-making (15%); greater utilization of equipment and machinery (15%); new services (11%); and new revenue streams (13%).

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Perceived benefits

But when asked about the challenges to getting IoT projects off the ground, respondents cite unclear benefits as joint top inhibitor (17%), alongside uncertainty about how to get started (17%), followed by lack of strategy (16%) and no perceived demand for such a strategy from the business (16%).

Kinder advises:

Our advice would be to look at the device data you are already collecting – most plant equipment is already instrumented - and ask what questions could you answer if only you could collect it, apply analytics and distribute the insight quickly to the right decision maker?

Even better, who outside your organization would want to purchase the information only you can provide? Then have this conversation with your technology provider – the pieces are all available to turn it into a reality.

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IoT barriers

The answer there in this instance would be Infor, of course. CEO Charles Phillips says that the firm’s evolving IoT thinking mirrors its overall cloud approach:

We are working with Amazon on the IoT strategy, We are also industry-focused here. We’re not just going to build something generic and hope that customers will come. We’re working with healthcare clients to collect data on care paths.

That involves putting sensors on doctors, nurses, medical equipment and patients and pulling in data from HR, supply chain, financials to create something called Cloud Suite Clinical.

It will also involve working with and talking to customers about their needs and potentially partnering with some of them. A prime candidate would be the likes of CERN, whose Head of Engineering Processes Support David Widegren, says:

We are interested in the Internet of Things of course. We already capture about half a terabyte of data every day from our equipment. This is clearly a huge opportunity for Infor.

My take

A refreshingly down-to-earth reflection of the on-the-ground state of the Industrial Internet, market which is in grave danger of over-hype. We badly need some definitions in place around IoT and Industrial Internet that everyone can agree with. Clearly there are sectors in which IoT enthusiasm is high - such as field service management. In other areas, things will move slower.

Disclosure - at time of writing, Infor is a premier partner of diginomica.