Impact of IoT on Manufacturing: From Organizational Structure to Production Technology

This article discusses the two main areas where the Internet of Things (IoT) will have an impact on the current manufacturing landscape. It covers how IoT will transform the organizational structure of manufacturing companies and the role of IoT in improving manufacturing technologies. The article also explores the future of product design and how connected products will impact the entire manufacturing value chain. This comprehensive analysis provides valuable insights into the impact of IoT on the future of manufacturing

The IoT is poised to bring about two major changes in the manufacturing industry. Firstly, it will require companies to adopt an organizational structure that enables them to produce integrated IoT solutions. This involves a collaboration between those in the machine and Internet sectors, resulting in the creation of products that blend physical components with Internet-based application services. As a result, many companies will need to transform into both a manufacturing and an Internet company, or risk being subsumed in the larger ecosystem.

Manufacturing companies will need to develop capabilities in IoT service development and operation, leading to "integrated production for integrated products". Figure below illustrates this concept.

IoT integrated production for integrated products
This may prove to be challenging as it requires a change in the company's DNA and an evolution of its value proposition, affecting every aspect of the organization from engineering to aftermarket services.

The second area of impact is in the realm of manufacturing technologies. Connected manufacturing equipment, logistics chains, cyber-physical systems, and Big Data-based analytics will help improve production processes, which can benefit from the first area of impact. The manufacturing value chain of the future will be more integrated with IoT service implementation and operation.

The IoT will have a significant impact on product design, as the future products will be connected and part of the Internet of Things. These products will have embedded computing capabilities and will provide digital services and content. This combination of physical products and connected backend services will require an overhaul of product design, as physical components may change and products will become increasingly reliant on remote services in the cloud. Connected products will also provide a wealth of product usage data, which will be used to inform all stages of the value chain, from sales and marketing to after-sales services.


[1] A Guide to Understanding the Internet of Things (IoT) - From Concept to Reality

[2] Switch Monitoring with Arduino IoT platform

[3] ESP8266 LED blink tutorial

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