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Smart Factory plans advance with help of IoT, edge computing, according to Microsoft, Intel report

Smart Factory plans advance with help of IoT, edge computing, according to Microsoft, Intel report

Microsoft, IoT Analytics, and Intel collaborated on an IoT Signals study focused on the manufacturing sector to respond to this developing market. Specifically, market research firm IoT Analytics interviewed 500 decision-makers from diverse manufacturing industries and conducted detailed interviews with a subset of them.

To succeed in today’s fast-changing environment, manufacturers must become more flexible, resilient, and sustainable, according to the report. To become more intelligent, companies seek innovative technologies to aid digital transformation in areas such as Industry 4.0, IT-OT Convergence, IoT, artificial intelligence (AI) and digital real estate.

The companies designed this IoT Signals report to give new insights regarding the present and future state of IoT technology in manufacturing firms’ digital transformation plans. Specifically, the report focuses on manufacturing operations and smart products. In providing these insights, the objective of the report’s authors is to advance these technologies by encouraging manufacturers to embrace them more quickly and effectively.

The paper presents insights from companies that have embarked upon their digital transformation journey. It looks at the significant driving forces of digital change and businesses’ immediate objectives and challenges. The report also explores how organizations view technology, procedure, and people in helping them to speed up their initiatives.

Some of the key insights included:

  1. Manufacturers are boosting their Smart Factory efforts in the wake of COVID-19.

Almost three-quarters of the respondents (72%) have advanced from the proof-of-concept (PoC) phase. They are now implementing their Smart Factory plan in various stages. On average, they predict their performance will improve by 66% more than in the previous three years.

  1. The primary objective of Smart Factory plans has not changed: improving operations.

Overall equipment effectiveness (OEE) is considered by four out of five businesses as the most critical KPI to assess the success of their Smart Factory plan.

In the next three years, executives predict that cybersecurity, quality and sustainability will see the most progress.

  1. Investments are moving to industrial automation-based process control.

Most Smart Factory initiatives have focused on quality control and condition-based maintenance. The increased need for flexibility and modularity is prompting manufacturers to focus their investments over the next three years on industrial automation-based process control (e.g., expenditures on industrial gateways linked to the cloud and software-based PLCs).

  1. Challenges associated with scaling Smart Factory initiatives are evolving

Manufacturers have overcome difficulties obtaining data from assets and interfacing with the cloud. Today, half of the respondents have problems creating new software applications.

Eighty percent of the respondents said they had at least one critical skill deficit, with data science, artificial intelligence and cybersecurity topping the list.

  1. IT–OT convergence is occurring

Connected assets now make up over 75% of manufacturing assets. Many workloads and apps are moving from on-premises infrastructure to public and private cloud deployments, particularly the latter. The software-as-a-service model is quickly becoming the most common deployment type. At the same time, tools like containers are making their way into factories and onto edge hardware.

  1. Large investments in Smart Products will occur

Manufacturers are also improving their productivity and generating alternative revenue sources through innovative connected IoT products marketed to customers.

Businesses that already sell Smart Products anticipate their percentage to rise from 33% today to over 50% in 2025, with a strong emphasis on value-added services such as remote assistance and predictive maintenance.


To keep up with the competition, manufacturers must continue investing in digital transformation initiatives. This includes industrial automation, process control, and developing new software applications. In addition, they need to take advantage of IT-OT convergence and focus on selling smart, connected IoT products. Doing so can improve their operations, performance, and bottom line.

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