Internet of Things
How to gain full value from digitalisation
The concepts and technologies surrounding digitalisation, the Industrial Internet of Things (IIoT) and Industry 4.0 are very impressive, but how can they be harnessed to deliver real customer value? Industry needs a different way of working if digitalisation’s promises are to be realised in practice. Ian Peverill, head of Service at SKF, explains how approaches, business models and industrial relationships must change.
cuSTomer value FIrST anD ForemoST The rapid development we have seen in connectivity, control and analytics certainly holds much potential for improving economy, quality and productivity in industrial operations. If it is to be unlocked fully, however, and if digitalisation is to achieve genuine success, measurable customer value must always be the focus. Suppliers of technology, products and
services to industrial customers often make the mistake of focusing on system solutions. Instead, they should first be clear on the customer’s specific performance needs. What would improved value look like for the customer’s company and what are its KPIs (key performance indicators)? For example, increased output is an
obvious KPI for many businesses. Loss of productivity through unplanned downtime can be extremely costly, so there is great performance value to be gained from minimising it. In the past, a company like SKF might have begun by discussing maintenance schedules, contracts and consultancy agreements. Today, those discussions should be shifted to centre around how asset performance and availability can be maximised to make the customer’s business more resilient in the long term. Gaining a deep understanding of the company’s operation and the conditions under which its machinery operates is fundamental. With this knowledge, we can take a more analytical approach to predictive maintenance and apply digitalisation to best effect.
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DIgITalISaTIon aPPlIeD To PreDIcTIve maInTenance Operational efficiency is the KPI which SKF has been helping one large Swedish paper and pulp company to deliver. By introducing condition monitoring as part of a predictive maintenance strategy, high unplanned stoppage levels have been reduced. In addition to saving the mill hundreds of thousands of Euros, it has yielded a lot of useful real-time data on noise, temperature and vibration. This will be analysed by SKF to solve both current and future problems. Although SKF’s attention is primarily
on rotating shafts and bearings, advances in 4G, 5G and real-time connectivity are opening up the possibility of seeing a bigger picture. Connection of bearing- related data with readings of parameters from other components can give a view of the machine’s health as a whole.
As real-time data connectivity
continues to develop, we can envisage closer integration across supply chains. For instance, we should soon see component manufacturers accessing customer machine data and scheduling optimally timed manufacture of replacements for wearing parts.
DIgITalISeD TranSFormaTIon oF buSIneSS moDelS Condition monitoring and digitalisation of industrial processes is leading businesses to reassess their traditional transactional models. SKF has seen a shift toward contract models based on performance or function. In a performance-based contract, the
customer pays a monthly base fee along with bonus payment, at longer intervals, dependent on meeting agreed KPIs. In a function-based contract, the customer pays an agreed regular fee for which the provider commits to delivering equipment functionality. In both models, it is in the interests of the supplier to improve the customer’s operation and ensure it runs smoothly, efficiently and productively. Digitalisation becomes the key to creating innovative and more effective ways of paying for enhanced operational performance. As an example, digitalisation applied within such a model has been applied by SKF under a continuous service agreement with a mining operation. SKF has 8,000 sensors monitoring 2,400 critical assets on the customer’s production lines, including pumps, fans,
May 2021 Instrumentation Monthly
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