Digital transformation, the industrial internet of things (IIoT), and smart connected assets have been prominent themes over the past 12-18 months. For the most part, these have been separate focus areas in industrial organizations. In fact, however, they're closely related topics. As pilot projects take hold in a variety of industries, no one industry has the lead; many are finding small wins and value. This is creating a larger opportunity for investments in technology and transformation in 2017. This means that pilots are successful, so expansion into larger asset bases or different parts of the business will occur.
These enabling technologies and related transformational efforts are letting organizations gain competitive advantages. The early adopters of this new paradigm can expect lower overall operations costs thanks to improved asset reliability, longer asset life, and lower decommissioning and disposal costs. What is missing is a discussion of the larger picture of these projects' potential effects on the asset lifecycle and what it all means for operations and maintenance moving forward in the IIoT era.
At the heart of the discussion should be a commitment to understanding everything this new era touches related to the asset. This includes changes in the technology architecture: The asset becomes smart; the workforce becomes empowered; and applications evolve. At LNS Research, understanding the new asset lifecycle era in IIoT is a key focus and we believe emerging technology will continue to play a prominent role in asset lifecycle management.
The role of digital transformation, IIoT platforms & smart connected assets
Digital transformation means shifting to new production, business, and customer engagement models and enabling unprecedented business possibilities. These can include packaging services of industrial equipment, selling capacity instead of capital, and improved performance. For industries that rely on physical assets to produce the goods and services they deliver, smart connected assets (SCA) are at the heart of digital transformation efforts.
One of the strategic objectives we see asset-intensive organizations beginning to pursue is smart connected assets. We define SCA as those assets a business uses to produce and deliver its goods and services that can sense and respond to internal and external environments as intelligent agents. This means they are aware of and can react to:
- Design and configuration
- Past performance
- Predicted future failure
- Raw material
- Environmental impact
- Other factors, such as customer requirements or supplier performance
These assets are more than just digital sensors connected to a control system. Smart connected assets allow an enterprise to move beyond real-time control to predictive control and possibly autonomous operation.
The glue that holds these efforts together for transformation and assets is the emergence of IIoT platforms. No offering today can provide everything required to enable asset lifecycle management in an IIoT era, and possibly this may never occur. This is a big reason why moving forward now with pilot projects is so important: Doing so will help you figure out what works and what doesn't for your business so your organization can build a platform that works for it. Understanding key platform components is a good first step here; a best-in-class platform should consist of cloud services, big data and analytics, connectivity, and application development capabilities.
IIoT as catalyst for operational architecture
A larger challenge organizations face as they make the leap with IIoT platforms is making the transition from an IT-centric view typical of classic enterprise architecture (EA) activities to a focus on the day-to-day operations of the business. When applying EA to daily operations, companies need to think in new terms: specifically, in terms of operational architecture (OA).
Jason Kasper is a research analyst with LNS Research, which provides advisory and benchmarking services to help Line-of-Business and IT executives make critical decisions across areas including the IIoT, digital transformation, and operational excellence (www.lnsresearch.com/blog). Kasper's primary focus is on asset performance management with collaborative coverage across sustainability, energy management, and IoT/machine-to-machine (M2M) practice areas. Contact him at [email protected].
Operational architecture takes the discipline of the IT domain and its EA activities and translates them to reflect the operational side of the business. It is only natural that we think of operational architecture as the culmination of the IT and operational technology (OT) convergence. LNS Research strongly believes that OA is critical to executing a successful asset lifecycle management approach in an IIoT era.
As with any initiative, there are strategic concerns and tactical elements to consider. The OA exercise helps clarify and separate strategy from tactics and aids an organization in understanding where it is today and defining where it needs to be to accomplish its business objectives. It provides the map for how to get from the as-is to the desired state.