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Designing for the ‘Internet of Things’

Posted By David Brousell, June 24, 2014 at 1:17 PM, in Category: The Innovation Enterprise

The high tech industry and its supporting cast of research firms and consultancies are all abuzz these days with the idea of the “Internet of Things”. The trend they think they have identified is that every conceivable physical object in the world will likely become IP-enabled, leading to a massive new era of innovation with significant new opportunities for information-related services and products and even “disrupting” existing markets and business models.

The consulting firm McKinsey, for example, projects that the IoT will uncork $6.2 trillion in global economic value by the year 2025. As evidence of an inexorable trend, others have noted that, beginning in 2010, more “things” were connected to the Internet than people.

In one variation or another, a number of high tech providers such as Cisco Systems, Microsoft, and Google, are talking energetically about the IoT and its many possibilities. So I found it both interesting and intriguing that PTC, the 29-year-old product lifecycle management software firm known for its design products that, in recent years, has entered adjacent markets like service lifecycle management, would make IoT a central message at its PTC Live conference last week in Boston.

In his opening keynote, PTC president and chief executive Jim Heppelmann said the implications of the IoT for manufacturers are large and varied. Not only do manufacturers have the opportunity to create smart, connected products that can serve customers better through, in part, better service, he said, but they will also be able to create whole new businesses based on the IoT.

That’s because, Heppelmann said, the source of value in products will increasingly change because of the IoT. He cited three factors: with millions of lines of code in some hardware products already, hardware is increasingly “sharing the stage” with software; more pervasive connectivity is enabling new levels of monitoring, control, and communications; and business models that had been based on “product” offerings are transforming into service business opportunities. He cited Philips’ ability to offer lighting as a service, rather than just as products, as an example.

But one of the most important parts of Heppelmann’s message, one both echoed and expanded upon by other speakers during the conference, was that IoT done right begins at the design stage, that a product designed from the ground up with the IoT in mind leverages the possibilities of the IoT better.

As PTC customer Dave Riddle, director of IT at Thermo Fisher Scientific, said in a presentation, “Think process-centric, and design products and services that are designed to work together.”

[Heppelmann also discussed his ideas about the IoT in an article he wrote for the June issue of the Manufacturing Leadership Journal. In “The Internet of Things: Transforming Manufacturing”, he said: “Manufacturers must plan and design flexible platforms that will deliver personalization, value-added services, and product enhancements remotely both before and after the product is in the market.”  http://gil-evenfs.gilcommunity.com/journal/internet-things-transforming-manufacturing/ ]

PTC has been making a number of strategic moves to get in front of the IoT wave. Late last year, the company spent $112 million to acquire ThingWorx, a provider of a development platform for IoT applications. As described by ThingWorx, the development platform combines Web 2.0 functionality, search, and social collaboration and applies it to connected products, machines, sensors, systems, and industrial equipment. At PTC Live, ThingWorx announced version 5 of its development platform.

PTC also announced at the conference that it has joined the Industrial Internet Consortium, an open membership group formed to accelerate the development, adoption, and use of interconnected machines and devices, analytics and people. The consortium was formed in March by AT&T, Cisco, General Electric, IBM, and Intel.

Based on its messaging at the Boston conference, its acquisition of ThingWorx, and its move to join the IIC, it is evident that PTC is very serious about the IoT and what it expects its impact will be on manufacturing. Hepplemann acknowledges the early stage of the market, but goes even further. “I think personally that most of the world doesn’t get it yet.”

PTC’s bet, then, is that it will figure things out before competitors and others. It’s a fair bet in my view. Heppelmann is fond of citing, as support for the IoT trend, Moore’s Law about chip densities and power and Metcalfe’s Law about the power of a growing, connected network. But I think it is actually a law articulated by former Intel CEO Andy Grove that is more pertinent. That law holds that what can be done is likely to be done.

I believe the IoT will follow this law. Yes, there will be much experimentation, success, even a few failures. We may end up finding out that somewhat less than every physical object will be IP-enabled. But the IoT is already happening and will only grow over time, perhaps exponentially.

For manufacturing executives, it’s time to jump in. And you may just want to start with a talk with your design engineers.

Written by David Brousell

Global Vice President, General Manager and Editorial Director of the Manufacturing Leadership Council

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