The Internet of Things and the future of ERP

One of the most talked-about topics in today’s world of manufacturing is the Internet of Things (IoT). The term refers to the embedding of sensors and computing devices into physical “things” that traditionally haven’t had any kind of connectivity, such as a light bulb, an infant’s pajamas, or even a cow. The things are then connected to wired or wireless networks, giving them the ability to communicate with one another, other systems, users, and/or manufacturers. Essentially, the IoT is a bridge between the physical world and the digital world.


The IoT's potential in manufacturing

The potential for the IoT in manufacturing environments is vast. As it pertains to production, for example, an Internet-connected machine would be able to communicate directly with the manufacturer in regards to performance. If a certain component or subassembly is performing at a suboptimal level, the machine would be able to alert operators and floor managers right away. Additionally, the machine would also send an automated message back to its manufacturer, which could either send someone to perform maintenance or simply ship the part needed.

The IoT could also have a transformative effect on the extended supply chain. On the supply side, original equipment manufacturers (OEMs) could see a dramatic boost to efficiency in terms of managing ever-changing relationships with a global array of suppliers. With the rise of lean manufacturing, OEMs need to have the perfect amount of inventory on hand at all times. One potential benefit of the IoT is for inventory systems to automatically alert suppliers when a particular item needs to be replenished, allowing them to prepare and ship the product exactly when the manufacturer needs it.

On the customer side, OEMs can build connective capabilities directly into their products, allowing for post-sale service. Consider a car: With IoT capabilities, the onboard system can let the manufacturer and end user know when it's time for a repair, before the car actually breaks down. This kind of service can open significant post-sale revenue streams for OEMs and provide a better overall service experience for the customer.

In spite of all that's been written and discussed regarding the IoT, many manufacturers are still figure out how to best integrate it into their operations.

Bugra Derre, technical consultant for mobile applications and the IoT at abas ERP, noted that despite the promise of the IoT, the technology really is still in its infancy. "Even though we've seen some of what the Internet of Things can do for businesses, it's still a young concept,” he said.

There could be many benefits and creative uses that arise in the future that haven’t even been thought of yet.

The developers at abas ERP have taken a forward-looking approach to the IoT by adding a layer of flexible middleware that can provide an interface for Internet-connected devices, equipment and products to interact directly with the company's ERP systems. This flexibility means that regardless of the innovative new uses that businesses come up with for the IoT. abas will be ready to support them.

The Internet of Things will play a major role in manufacturing in the near future, and manufacturers should be looking for ways to prepare for it now.

abas ERP has made it possible for manufacturers to integrate the IoT into their operations without having to completely overhaul their ERP systems when making the new technologies work together with the existing system.

Although many organizations are still thinking through how to integrate the IoT into their businesses, it's clear that now is the time to start. Because the IoT has a direct impact on everything from the supply chain to production and post-sale service, the key thing manufacturers can do now is to ensure that their ERP systems are able to anticipate the proliferation of connected "things."

"The IoT will establish new data sources and connected things will talk a lot with each other.," said Derre." "To get a valuable revenue for your business, data analysis will need to play an important role."

Still interested in IoT? Check out one of our articles, The 6 Technology Trends that are Revolutionizing the Custom Manufacturing Industry, for even more information.

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