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IoT’s game-changing role in modern asset management

Nov. 13, 2023
In the past, asset management was dominated by manual procedures. But IoT furnishes manufacturers with real-time data streams, facilitating an unparalleled level of precision in monitoring, tracking, and managing machinery.

The Internet of Things (IoT) has been a transformative force across various sectors, from health care to agriculture. One of the most significant impacts of IoT has been in the realm of business, particularly in asset management. According to a study by Cisco, IoT will generate $14.4 trillion in value across all industries in the next decade, with asset utilization being one of the primary factors. This underscores the profound influence IoT has on optimizing asset management efforts, leading to enhanced operational efficiency and profitability.

In the past, asset management was dominated by manual procedures, often proving to be tedious and error-prone. However, the emergence of IoT has dramatically rewritten this narrative. IoT, characterized by its vast network of interconnected devices, furnishes businesses with real-time data streams, facilitating an unparalleled level of precision in monitoring, tracking, and managing assets.

A comprehensive study by Deloitte underscores this transformation, revealing that a significant 40% of manufacturers who have integrated IoT solutions have reaped tangible benefits in asset management.

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The underlying mechanics are straightforward yet revolutionary: IoT devices, embedded with advanced sensors, consistently transmit data pertaining to an asset’s location, health, and operational efficiency—to a manufacturer this is a machine on a factory floor.

When this wealth of data is meticulously analyzed, it unveils insights that were once beyond reach. Take, for example, a fleet of trucks outfitted with IoT technology. Such a fleet can offer instantaneous data on various parameters like fuel consumption patterns, optimal route suggestions, and imminent maintenance requirements, thereby driving operational excellence.

Maximizing asset utilization with IoT

IoT has emerged as a transformative force, reshaping the landscape of asset management by offering businesses a comprehensive understanding of how their assets are utilized. This shift from traditional methods to IoT-driven strategies has brought about significant enhancements in efficiency and productivity.

A study by Webisoft highlighted that companies harnessing IoT for asset tracking witnessed a remarkable increase in asset efficiency, finding that implementing IoT in manufacturing resulted in a 20% decrease in maintenance costs and a 15% increase in overall equipment effectiveness. This surge in efficiency is not just a mere statistic; it translates to tangible benefits for businesses. By optimizing asset utilization, companies can significantly reduce idle times, ensuring that every asset is leveraged to its maximum potential, thereby driving value.

Delving deeper into the practical implications, here are some of the benefits of enhanced asset utilization:

  • Defer capital investments: IoT-driven asset utilization data can be harnessed to prolong the useful life of capital equipment. For example, CNC/milling machines, already equipped with sensors monitoring various parameters like vibration and hydraulic pump flow rate, can be further optimized using IoT data. This not only enhances performance but also defers the need for new capital investments.
  • Real-time identification of underutilized assets: IoT systems can provide real-time telemetry and contextual data against utilization metrics. This means that assets that are underutilized can be quickly identified and reallocated, ensuring optimal usage. Such systems can even alert operators when an asset is lying dormant, enabling swift corrective action.
  • Informed equipment design: A historical dataset of asset utilization can be invaluable for equipment manufacturers. By understanding how their products function in real-world scenarios, manufacturers can make informed decisions about future design enhancements. For example, in the oil and gas sector, data from actual customer installations can provide a broader range of use cases, leading to better-designed products.

Businesses that have delved deeper into their IoT implementations have uncovered long-term benefits. These range from making informed decisions about asset design to unlocking more ROI and operational performance. For example, real-time visibility into revenue-generating assets, such as settings and environmental factors, can be achieved. This not only aids in compliance, especially in regulated industries, but also enables the creation of complex business logic based on predefined rules.

IoT-powered predictive maintenance of critical assets

The world of asset management is undergoing a significant transformation, thanks to the integration of IoT. This technological advancement has shifted the traditional reactive maintenance paradigm to a more proactive, predictive model. A study by McKinsey underscores this transformation, indicating that businesses could potentially reduce their maintenance costs by up to 40% when they harness the power of IoT for predictive maintenance.

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At the heart of this change is the ability of IoT sensors to continuously monitor the health and performance of assets. These sensors capture a wealth of data, from temperature fluctuations to vibration patterns, providing a comprehensive picture of an asset's condition. By analyzing this data in real-time, issues can be identified well before they escalate into significant problems. This proactive approach not only minimizes downtime but also optimizes the lifespan and performance of assets.

The insights derived from this continuous stream of data also are invaluable for strategic decision-making in asset management. Companies can now make more informed choices about when to service or replace equipment, ensuring that resources are allocated efficiently. This data-driven approach also allows for better budgeting, as unexpected equipment failures and their associated costs can be significantly reduced.

Asset tracking in real time offers unmatched visibility

The integration of IoT into asset management has revolutionized this domain, offering businesses unparalleled visibility into the location and status of their assets.

Real-time asset tracking, powered by IoT, provides a continuous stream of data, allowing businesses to monitor the movement, condition, and utilization of their assets around the clock. This heightened visibility significantly reduces the risks associated with theft, misplacement, and prolonged downtime. It ensures that assets are always accounted for, and any anomalies or unauthorized movements can be swiftly detected and addressed.

A comprehensive report by Forrester has highlighted the significant advantages of real-time asset tracking technology. Their in-depth research reveals that by implementing this technology, organizations can witness a remarkable reduction in lost or stolen assets. This statistic underscores the transformative potential of real-time tracking in safeguarding valuable assets and ensuring their optimal utilization. By leveraging such technology, businesses can not only enhance their operational efficiency but also significantly mitigate risks associated with asset misplacement or theft.

Optimizing the lifespan of capital equipment with IoT-driven data

IoT has ushered in a new era of data-driven insights, particularly in the realm of asset management. For example, consider CNC/milling machines, which are integral to many manufacturing processes. These machines are traditionally equipped with sensors that monitor parameters like vibration and hydraulic pump flow rate. However, with the integration of IoT, the depth and breadth of data that can be captured and analyzed are magnified.

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According to an article from Facilio Blog, asset lifecycle management (ALM) is crucial for business productivity and efficiency. It emphasizes that a 360-degree visibility of an asset portfolio can help businesses minimize risks and optimize asset health. The article further elaborates that life cycle asset management (LCAM) assists businesses in analyzing the optimal operating lives of assets and planning replacement or maintenance accordingly. By using a data-driven approach, asset lifecycle management software ensures that assets remain useful for the longest time possible.

At the forefront of asset management strategies

The transformative power of IoT in the realm of asset management is undeniable. From offering real-time insights into asset health to predicting maintenance needs and extending the lifespan of critical equipment, IoT stands at the forefront of modern asset management strategies. The ability to harness the full potential of assets becomes paramount.

The tangible benefits, as highlighted by numerous studies and reports, underscore the profound impact of IoT on operational efficiency, cost savings, and overall business profitability. It's clear that the integration of IoT in asset management is not merely an option but a strategic imperative for businesses aiming for sustained growth and success.

About the Author

Charlie Green

Charlie Green is senior research analyst at Comparesoft. Facilities management, smart buildings, workplace management, IoT, and asset tracking are his key research areas.