The industrial Internet

The next wave in manufacturing technology

The Internet of Things has seen extraordinary growth over the past few years as a result of low-cost electronics and standard protocols. The price of connected devices has plummeted, which is why Cisco confidently states that 50 billion devices will come online by 2025!

Although the technology is fascinating in its own right, the value created by this technology is even more astounding. Consulting firm McKinsy & Co. estimates that the IoT “offers a potential economic impact of $4 trillion to $11 trillion a year in 2025.”
Design and manufacturing are closer than everThe Industrial Internet (also known as Industry 4.0, the Industrial Internet of Things or IIoT) is perhaps the most valuable segment of the IoT market, with an estimated economic impact of up to $3.7 trillion, roughly one-third of the total IoT value. The Industrial Internet includes industries such as oil, mining, aviation, energy and manufacturing.

The Industrial Internet is best considered a subset of the much broader IoT, alongside the Smart Home, for example. Although both the Industrial Internet and the Smart Home are comprised of networks of connected hardware, the Industrial Internet requires much tighter security at a much higher price point.

In many respects, the Industrial Internet is here today and not just some vision of the future. Today, most new construction equipment is already tagged with GPS and remote diagnostic capabilities. GE’s jet engines are able to reduce aircraft downtime by predicting failures using data analytics from the vast amount of real-time sensor data being reported.

Smart manufacturing

The manufacturing industry is on the brink of major transformation as a result of the growing number of Internet-connected equipment. Keith Nosbusch, chief executive officer of Rockwell Automation Inc., recently said, “We believe industrial operations will change more dramatically in the next 10 years than they have in the past 50.”

The combination of Internet-connected machinery and a mobile-connected workforce will allow for production managers to keep a pulse of plant operations from anywhere. Thresholds can be set to trigger notifications to the appropriate person when action is needed, even during off-hours.

One killer application of smart manufacturing so far is predictive and preventative maintenance on vital equipment. Planned maintenance can theoretically create a zero-downtime plant operation. Data such as temperature spikes, power surges and abnormal vibrations can be used to predict machine failure based on statistical data analysis. Companies could even use this data to provide more knowledge on product specifications in order to create more sophisticated warranty plans.

The next Industrial Revolution

Pioneers such as Eaton Corp. and Milwaukee’s own Rockwell Automation have been helping manufacturers connect their equipment for decades with products such as sensors and programmable logic controllers. The problem is that these networks often communicate in silos without any connection to the company’s IT infrastructure. For example, a machine operator may be able to shut down a production line with the click of a button, but the office workers won’t know that their customers’ orders will be delayed until much later. The industry uses reactive tools rather than proactive tools.

To harness the true value of the Industrial Internet, manufacturers will have to integrate their operational technology into their information technology; this is known as the convergence of IT and OT. Rockwell Automation calls this the “connected enterprise.” The insights found when connecting the dots between manufacturing operations and administrative support will help companies make better decisions.

Call to action

Drastic change creates opportunities for those willing to risk their current position. If history repeats itself, Industry 4.0 will provide the opportunity for innovators and risk takers to grow fortunes in the same way that the prior industrial revolutions provided similar opportunities.

Wisconsin is in a unique position to harness this macro-trend in order to bring about economic prosperity. Milwaukee, for example, would not be the powerhouse of industrial activity that it is today if it weren’t for the enterprising leaders of companies such as Allen-Bradley and Harley-Davidson Inc. in the early 1900s. Additionally, Wisconsin is evolving into a magnet for software talent, with software giants such as Epic Systems in Madison. These two factors create a recipe for success in creating an epicenter in smart manufacturing technologies.

In fact, a local economic development group is currently preparing a bid for a Department of Energy-sponsored Smart Manufacturing Institute, as part of the Obama administration’s effort to revitalize American manufacturing. This institute could very well put Wisconsin back on the map for its manufacturing prestige.

Wisconsin, let’s use this opportunity to improve our economic position before we get left behind. In the words of Jeff Immelt, GE’s CEO, “If you went to bed last night as an industrial company, you’re going to wake up in the morning as a software and analytics company.”

-Jesse DePinto is a Milwaukee-based serial entrepreneur and business technology consultant. His company, Tosa Labs, helps clients optimize manufacturing efficiency via Internet-connected monitoring equipment. You can connect with him via email at, call him at (937) 829-3720, or via social media at or

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