The Internet of Things (IoT) is the latest industry buzzword. But peel away the hype and what’s the real impact of IoT on Australian food & beverage manufacturers?
The Internet of Things (IoT) is about smart connectivity and data. It refers to the ability of physical devices to connect with the internet so that one device can talk to other devices and provide valuable data and insights.
To read most of the hype written about IoT you’d be forgiven for thinking it is all about objects, sensors, big data, cloud technology, interconnectivity and the internet.
But for food & beverage manufacturers, IoT is about finding new solutions to make the industry more efficient, safe and profitable. The masses of data being generated offer food & beverage companies huge potential to transform operations across traceability, compliance, unplanned downtime, staffing, inventory management, partner collaboration and more.
Manufacturers should carefully monitor the coming changes and work out how to take advantage of the new opportunities.
Improving food safety
Food safety is under continuous scrutiny. The costs and media coverage associated with food & beverage contaminations, product recalls and withdrawals means the impact of failing to meet food safety standards can be crippling for a brand. As a result, more and more manufacturers are turning to IoT to track ingredients, packaging and finished goods faster and more effectively.
For example, some manufacturers are deploying food sensors connected to the internet to monitor production times, shipping times and temperature. IoT enables manufacturers to keep a constant watch on refrigeration temperatures throughout the production, transportation and storage of food. Operators can configure real-time alerts to notify them when conditions fall outside specified thresholds, enabling instant corrective action.
If something does go wrong, and the product doesn’t meet the right level of quality, IoT enables manufacturers to rapidly extract the cloud-stored data to trace the source of the problem and correct it.
IoT and the accompanying use of data analysis can bring many advantages in preventing manufacturing downtime and the continuous effort for better efficiencies. Many Australian farmers are already monitoring and directing operations from a central location; they extract big data from sensors located around the farm to remotely monitor conditions. This allows the farmer to make smarter decisions based on real-time data collection of weather, soil condition, crop maturity and equipment performance.
On the factory floor, one of the biggest advantages is how sensors and connectivity can provide a constant flow of data to optimise workflows and staffing. The Internet of Things can be used to monitor production flow in real-time to eliminate waste and unnecessary work.
For example, IoT can be used in the real-time tracking of inventory, meaning there’s less need for human intervention. Depleted inventory bins fitted with real-time sensors can automatically signal when they need replenishment and activate the retrieval of new stock.
Sensor-equipped machinery can also help food and beverage manufacturers minimise unplanned downtime and ensure machinery is always at optimum performance. IoT enables things such as maintenance alerts and remote diagnostics. For some machinery, maintenance can be conducted via the network too, with fixes sent as software updates rather than technicians armed with tools, meaning there are fewer interruptions to production.
Then there’s the involvement of collaborative robots (cobots) that can take on repetitive tasks and interact with human managers. By collecting real-time information, the Internet of Things enables remote management of cobots on the factory floor. (For more on cobots, see this blog on things to know about cobots, while this blog on social robots also has some good information, and if you were at AUSPACK earlier this year, you would have met the customer-service robot AMY.)
The benefits of IoT are not limited to the manufacturer; cloud-based solutions simplify data access and sharing across the supply chain, from farmers to shipping partners, retailers and end consumers.
What’s holding food & beverage manufacturers back?
There’s no doubt some manufacturers are already reaping the rewards of investment in IoT. According to IDC data, published early 2017, the manufacturing industry made up a total IoT spend of US$178 billion (A$240.4m) in 2016, more than twice as much than the second-largest IoT spenders, transportation. Business Insider reported that manufacturers utilising IoT solutions in 2014 saw an average 28.5% increase in revenues between 2013 and 2014.
So, what’s holding others back? A recent survey by Forrester found that only “about one-third of firms are leveraging captured connected device data to provide insight to internal stakeholders and partners, personalise interactions with customers, or profile and segment customers.”
Challenge #1. Knowledge
It’s a big commitment to stay abreast of IoT solutions. Mastering the relevant technology capabilities that will let you analyse the big data is no easy task. For companies without sufficient understanding of the technology, it could be time to address these shortcomings.
Consider appointing advisory panels with technology experts, bringing in experts in digitisation and data analysis, or working closely with equipment providers. This is an important first step towards harnessing the knowledge of IoT.
Challenge #2. Cost
IoT operates as a large interconnected system that embraces lots of smart products. Connectivity is the IoT watchword, which means working with supply chain partners. However, manufacturers may be fearful that the more parties involved, the more complex the solution. In reality, working with supply chain partners to identify solutions will lead to synergies and cost savings in the long term.
Challenge #3. Fear
What if it doesn’t work? What if I waste all that investment? What if someone steals my data or hacks into my facility? There are lots of “what if’s” stopping manufacturers from embracing the Internet of Things. However, there are plenty of examples around the world of food & beverage companies successfully leveraging IoT and enjoying the benefits — particularly where IoT is seen as a natural progression of current practices. But if your business is still unsure of the benefits, one way to proceed is to pilot ideas in conjunction with major partners.
Beyond the hype, the Internet of Things can bring a decisive competitive edge to enable businesses to better analyse and forecast market demand. It delivers faster information across the supply chain, which leads to both better decisions and increased responsiveness to the market. It can drive better efficiencies and enhance quality control. The Internet of Things is a transformer of industries. So strip away the jargon, and consider the impact of IoT technology in your company. Start evaluating existing solutions and partners, and think about the potential benefits that IoT could bring. It could surprise you.
Check out Matthews’ vast resource library. It has a host of detailed information that’s all free to download! There are whitepapers, presentations we’ve done to industry bodies, infographics for manufacturing, case studies, articles from our thought leaders, vids showing solutions in action and more!
Image credit / andongob