Update the ERP automatically on production activities leveraging IoT (Internet of Things)

Lately, Internet of Things (IoT), have opened up an entirely new avenue for taking benefits using the existing ERP software implemented in the organizations. Though IoT will be beneficial in many areas and early movers in this field are healthcare/wellness and entertainment industry specially leveraging it with consumers, one of the hidden benefits it can provide is the field of running the business transactions in in your old ERP.

In one of the CIO conferences, we were talking on how can we leverage this in our respective organizations and some very exciting use cases have come up where in few CIOs have started taking actions specially in manufacturing sector.  Every organization is pushing the bar high every year for more productivity from employees and they are exploring all options whether non-technical like outsourcing to experts or technical like automating few operations or deploying IT solutions. IoT is another area which was found to be beneficial in addressing productivity concerns as below: 

• Users need to perform production related activities also as well as have to enter data in ERP to record the activities
• To ensure proper record of activities, either a strong process discipline is required or ERP will need to be customized to put checks and balances in place
• Mistakes happen with new users and lot of time is wasted in running the ERP
• Multiple times, data in ERP doesn’t match with actual physical data such as WIP inventory
• Time lag between actual activity and activity performed in ERP which skews the actual performance of a machine or a resource

Fortunately, all above can be resolved using IoT technology in conjunction with ERP. You just have to make your machines internet enabled, put some sensors around which can read the data that you want to send to ERP and then can send the data to a middle layer where you do data massaging and filter it to ensure that you send only relevant data to ERP. As soon as it reaches the ERP and updates corresponding details in it, you are all set to view your analytics reports. It also will help you calculate better product costing as well as costing of all functions related to production. Another major benefit that you will get by deploying IoT, is that you will now have access to huge set of data from your machines which is ready to be analyzed in the middle layer and multiple improvement plans can be made around those identified areas. Since this data will be huge by any standards, big data solutions will be able to help the organization immensely here. This will be another step in increasing productivity of resources in the organization.

 

Since there is a cost involved in installing sensors as well as a feasibility study will have to be done for the machines whether they will be able to support sensors, it may take some time to gain pace in the manufacturing industry and I assume that everybody is watching for one good case study so that they can also go ahead use this new revolutionary concept that I highlighted in 2009 in my earlier post here.