Chemical companies are investing billions of dollars in technology solutions designed to capture, process and use data generated from a myriad of devices, partners and industry systems. As companies explore what is being called the Internet of Things, they are seeing substantial return on investment in the form of equipment effectiveness, reduced quality costs, improved supply chain visibility and much more. Chemical executives that know how to successful navigate this era of big data are transforming the way business gets done, while those that lag behind are jeopardizing the future.
The Internet of Things
The Internet of Things (IoT) is defined by Gartner, Inc. as a network of physical objects that contain embedded technology to communicate and interact with their internal states or the external environment. The amount of information flowing to and from these smart machines is incredible. Yet, data by itself is relatively useless. It is only when chemical companies have the intelligent systems and technology backbone in place to capture the data and convert it into action that the true value of the Internet of Things can be realized . For example, IDC forecasts the IoT revenue opportunities for process manufacturing industries (including chemicals) will be $167 billion by 2018.
A lot has been written on the data being generated by sensors embedded in everything from test tubes to turbines. Yet it’s difficult to understand the tangible benefits of the Internet of Things without some concrete examples to explain how newly available information is being used to change the business of chemical manufacturing. Below are a few ways chemical companies are capturing data and using it to make insightful business decisions. Of course, it is important to remember that companies are just beginning to understand how to operate in this new, data-intensive environment.
- Predictive Maintenance - Today’s assets like chemical reactors are more intelligent thanks to embedded software and analytics that can diagnose their health. Assets send signals about their status and performance to predict possible malfunctions and maintenance needs. 3D asset visualization delivered in a spatial context, known as augmented reality, further enhances maintenance from a service perspective.
- Operational Intelligence - Chemical firms generate volumes of data during manufacturing, but they exploit only a small amount to improve decision making and add value. By blending all your data, analyzing it in real time, and federating results for intelligent decision making, you can improve operational, safety, and environmental performance.
- Quality Assurance – The ability to analyze large quantities of data quickly can improve quality assurance and processes. Many chemical companies focus on the last 30 batches of materials to manage process quality and controllability. Today, companies can analyze tens of thousands of batch results across the enterprise and use the broader data set to change operating conditions and improve quality.
- Smart Products and Connected Logistics - In a complex and heavily-regulated, global business environment, it is important to have an integrated supply chain. Data from sensors embedded in product packaging or transportation assets can help to track and trace the location, condition, and authenticity of products. For example, alerts or signals from RFID tags can identify when temperature or moisture levels deviate from acceptable ranges or provide evidence for counterfeiting of shipped products on their way to the final destination. Also, sensors can help with locating containers and even track moving assets to prevent loss.
- New Business Models - Today’s farmers want to produce higher yields using fewer chemicals in a very precise way. Called “precision farming,” this approach relies on an ecosystem of farmers, agribusiness suppliers, equipment manufacturers, traders and technology providers. These stakeholders need a secure, Big Data–enabled platform for accessing and sharing data to support precision farming. Sensors capturing and transmitting information such as local weather data, GPS data, or soil specifics including fertilizer and crop protectant levels are pivotal to success of such innovative business models.
As illustrated above, the business benefits associated with converting data into action are significant. From increased responsiveness across entire supply chains to operational processes that drive growth and enhance performance, there are clear advantages for nearly every department. To effective leverage the IoT for your organization requires a willingness to embrace recent technology advancements. First, organizations must have the ability to store large amounts of data. Second, you need processing capabilities powerful enough to analyze the information quickly and apply advanced algorithms for predictive insights. Companies should also have an integrated architecture capable of combining big data, analytics, mobile, cloud and social media on a single platform. It is also helpful to have a user-friendly, graphical interface to make sense of the data results and support augmented reality. Lastly, embracing cloud-based solutions that provide real-time access to the right data at the right time can save considerable amounts of time and money.
The Internet of Things is opening up opportunities we are just beginning to understand. Using technology to connect assets, people, products, and processes is helping chemical companies to make data-driven decisions, allowing them to capitalize on new growth opportunities while simultaneously saving money through more efficient operations. In what has been described as the “era of big data,” chemical companies that can take information and transform it into innovative action will be the undisputed leaders.