Industrial Engineering Using IoT

Take costs out

Driverless cars and appliances that manage energy consumption are examples consumer IoT . But the significant component of IoT initiatives  will occur in the business-to-business environment. 70% of IoT applications and value creation will be in the B to B space.


In business-to-business markets, there are three ways in which a supplier can deliver value to its customers. One way is to enable the customer to sell more product, either by capturing additional market share or by expanding the end market. A second way is to enable the customer to reach a higher price point due to the improvement done in the product. IoT has applications in  both of these alaternatives.

But the larger opportunity involves the third route to value creation and capture, namely initiatives that take costs out from the current cost base.

Significant amounts are spent after a  company buys the new equipment.  The costs involve ongoing operating costs – energy use, preventive and corrective maintenance, replacement of consumables and operator time among them. Some are related to commissioning, calibration, inspections, start-and-stop operations and changeovers related to production or customization. Some are related to regulation and record-keeping requirements.


These cost areas can be reduced through use of  IoT.  Contributions that take costs out are to be focused by industrial engineers.

Smart equipment initiatives that are self-funded out of savings realized in the costs  that are presently spent are going to become success stories for companies that focus their investments in that direction and bring those contributions to their customers.


Enterprises have to visualize the cost savings in  the complex customer chains that exist in many business markets.

It often will be the case that the opportunity to take costs out will involve a participant several stages down the customer chain, rather than the supplier’s direct customer.


In one recent case, a corporation approached the challenge of identifying IoT initiatives that made business sense by asking the question, “What data would have a game-changing impact on our business?”  A brain storming team was formed and engineers and sales people collaborated in an ideation session. One idea involved offering a remote monitoring service that could manage performance and detect problems on behalf of customers, many of whom operated the equipment at hundreds of sites. Capturing a database about what was going on with the equipment just prior to instances of failure had the potential to define the improvements that could avoid such failures. Enabling the company’s equipment to provide meaningful data to drive the enterprise’s decisions on new product investments had the potential to ensure that future product development initiatives would be rewarded in the market.


IoT Success stories will come in many flavors, but most of them will require a deliberate and thoughtful approach to generate a real understanding of how to translate new streams of data into value. Focusing on opportunities to take costs out of customers’ existing cost base,  on opportunities to gain a competitive data-driven advantage in markets, and on opportunities to answer the previously unanswered questions that can enable your own enterprise to make sound decisions on investments are three routes through which you can build the foundation for IoT success stories.

Industrial engineers have an important role to play in taking costs out of the production system throug huse of IoT systems in the cost of their factories, cost of supply chain and customer chain.


IoT Articles

You ain't seen nothing yet
IoT offers plentiful ways to add value in business-to-business markets
Industrial Engineer Engineering and Management Solutions at Work
April 2016    |    Volume: 48    |    Number: 4
The member magazine of the Institute of Industrial Engineers


http://www.mckinsey.com/industries/high-tech/our-insights/the-internet-of-things

http://www.pcworld.com/article/2690192/intel-pushes-factory-iot-with-9-million-cost-savings-at-plant.html

http://www.theguardian.com/sustainable-business/2015/mar/16/internet-of-things-energy-costs

http://www.businessinsider.in/How-energy-companies-and-utilities-are-using-the-Internet-of-Things-to-be-more-efficient-and-save-billions/articleshow/47239764.cms

https://www.linkedin.com/pulse/cost-reduction-preventive-maintenance-using-internet-iot-chakraborty

Converting Waste into Wealth - An Example - Using Wood with Imperfections

http://worldinsidepictures.com/this-man-started-with-these-knotted-slabs-of-wood-and-then-transformed-them-into-something-unique-and-beautiful/

See how a person uses wood pieces with imperfections to convert them into beautiful objects that people from far away places buy with enthusiasm.

March 4th Week - Industrial Engineering Revision Plan

Industrial Engineering Techniques Application 

Technical Processes (Engineering Processes)
Managerial Processes (Related to Technology Area Management)

Business Processes
Managerial Processes (Related to Business Area Management)

In every article the role of industrial engineer and relevant technique of industrial engineering  is to be specifically mentioned.  Please help me by writing a comment on what can be included to serve that purpose.

20th March - Birthday of Man of Productivity - Low Prices and High Incomes

Frederick Winslow Taylor - A Pioneer Industrial Engineer
http://nraoiekc.blogspot.com/2012/04/frederick-winslow-taylor-pioneer.html
Date of Birth: 20th March, 1856
Contribution of Taylor to Industrial Engineering
Shop Management
Scientific Management

March 4 Week (22 to 26)

Facility Layout - Review Notes

Product Design and Process Selection—Services

Total Quality Management: and Six Sigma - Process Capability and Statistical Quality Control

Operations Consulting and Reengineering

Supply-Chain Strategy - Review Notes

Strategic Capacity Management

Just-in-Time and Lean Systems - Review Notes

Forecasting - Operations Management Review Notes

Aggregate Sales and Operations Planning - Review Notes

Inventory Control - Review Notes for Chase et al.

28 March

Subject Update: Principles of Management

http://nraomtr.blogspot.com/2015/04/principles-of-management-subject-update.html

29 March

Subject Update: Marketing Management

http://nraomtr.blogspot.com/2015/01/marketing-management-subject-update-2015.html

Developing and Employing First Class People in an Organization - F.W. Taylor

The aim in each establishment should be:

(a) That each workman should be given as far as possible the highest grade of work for which his ability and physique fit him.

(b) That each workman should be called upon to turn out the maximum amount of work which a first-rate man of his class can do and thrive.

(c) That each workman, when he works at the best pace of a first-class man, should be paid from 30 per cent to 100 per cent according to the nature of the work which he does, beyond the average of his class.

And this means high wages and a low labor cost. 

These conditions not only serve the best interests of the employer, but they tend to raise each workman to the highest level which he is fitted to attain by making him use his best faculties, forcing him to become and remain ambitious and energetic, and giving him sufficient pay to live better than in the past.

Under these conditions the writer has seen many first-class men developed who otherwise would have remained second or third class all of their lives.

Is not the presence or absence of these conditions the best indication that any system of management is either well or badly applied? And in considering the relative merits of different types of management, is not that system the best which will establish these conditions with the greatest certainty, precision, and speed?

In comparing the management of manufacturing and engineering companies by this standard, it is surprising to see how far they fall short. Few of those which are best organized have attained even approximately the maximum output of first-class men.

Source
F.W. Taylor, Shop Management

Next Topic

http://nraoiekc.blogspot.com/2013/08/confronting-soldiering-slow-pace-of.html

F.W. Taylor - Shop Management - With Appropriate Sections
http://nraoiekc.blogspot.com/2016/03/fw-taylor-shop-management-with.html


Updated on 24 March 2016, 3 August 2013

F.W. Taylor Scientific Management - With Appropriate Sections

Scientific Management - Themes

1. Importance of National Efficiency

2. Foundation of Scientific Management

3. Soldiering and Its Causes

4. Underlying Philosophy for the Old Systems of Management

5. Scientific Management - Introduction

6. THE PRINCIPLES OF SCIENTIFIC MANAGEMENT

7. Illustrations of Success of Scientific Management - - Pig Iron Handling

8. Background for Development of Scientific Management - -Midvale Steel Company Machine Shop

9. Elaborate Planning Organization - Need and Utility

10. Illustrations of Success of Scientific Management - Bricklaying Improvement by Gilbreth

11. Illustrations of Success of Scientific Management - Bicycle Balls Inspection Example

12. Scientific Management in Machine Shop

13. Development of Science in Mechanic Arts

14. Study of Motives of Men

15. Scientific management in its essence

16. Role of Top Management in Implementing Scientific Management

17. Scientific Management Summarized

The Principles of Scientific Management - Reassessment after 100 Years in 2011

Scientific management was published in 1911.

Relevance of The Principles of Scientific Management 100 Years Later
Special Issue of
Journal of Business and Management – Vol. 17, No. 1, 2011
Link for full journal
http://www.chapman.edu/business/_files/journals-and-essays/jbm-editions/jmb-vol-17-01.pdf

Industrial Engineers and the Make in India Initiative in India

There is an article "Industrial Engineers and the Manufacturing Renaissance" in Industry Week.
http://www.industryweek.com/education-training/industrial-engineers-and-manufacturing-renaissance?page=1

NC State University's Industrial Engineering Profesor Paul Cohen made some interesting points that are relevant to Industrial Engineering Education in India.

We have entered the era of Manufacturing 2.0, where both shop floor employees and engineers will need new skills for more advanced manufacturing.

One of the primary skills is the ability to use information technology to connect all the pieces of a more complex, interdependent manufacturing environment. Additive manufacturing will contribute to a very distributed supply chain and it is to be in a network as designs can be sent over the network to 3D printing firms.

There is also a major challenge in teaching engineers how to design products to take advantage of 3D printing.  Certain geometries that can’t be produced with other processes can be produced using  3D printing processes.

Industrial engineers can identify cost reduction opportunties in producing components using 3D printing processes.

Industrial engineers in particular deal with people from the shop floor to the boardroom. So they should be able to communicate with everybody. So education in communication skills is essential for IEs.

The U.S. does not have enough industrial engineers moving through the educational pipeline. Cohen cites a 2012 article in The New York Times that examined the production ramp-up for Apple’s iPhone. The article noted that 8,700 industrial engineers were needed to oversee the 200,000 employees of Foxconn who would manufacture the phones. Apple estimated that it would take nine months to find that number of engineers in the U.S. But in China, it took only 15 days. That shows China is developing more IEs

According to Cohen, U.S., produces 3,300 industrial engineers a year.

How many IEs are produced in India through universities.  In India, we need to recognize the importance of IE stream and take steps to strengthen the stream.

3D Printing - Digital Printing - Engineering Economic and Cost Analysis

https://www.xometry.com/blog/3d-printing-vs-injection-molding-breakeven/