Manufacturers are feeling pressure to deliver new products and capabilities faster than ever. Connected products are the solution.
By delivering products that are intelligent and connected, manufacturers can build a brighter future, beat the competition by delivering a better customer experience, while creating totally new sources of revenue that are resilient to business cycles.
Not yet offering connected products? Your competitors are – or will be soon. Because customers are looking for smart, connected equipment – it helps them cut maintenance costs and reduces downtime. According to McKinsey, remote asset condition monitoring can reduce maintenance costs by 30% and cut machine downtime by 50%.
Uptime equals revenue for your customers, and this gives you every incentive to make smarter products for them. Products that monitor equipment health and catch problems before they arise and drive efficiency. Plus, acting on real-time data enables you to be more proactive and efficient with service calls, keeping your customers happy.
- New revenue streams. You can grow revenue by increasing sales of services, consumables, and components. Services revenue tends to be more repeatable and resilient than hardware sales and McKinsey has found that margins for services can be up to four times higher than equipment sales.
- Faster product development. When you know exactly how and when your products are used, you can accelerate the launch of new valuable features, and retire unused features just as fast.
- Increase customer satisfaction. You can improve the customer experience using insights on usage and performance from your connected products. Additionally, you have the ability for immediate issue resolution.
- Shift to equipment-as-a-service (EaaS) business models. Just as cloud and software-as-a-service (SaaS) helps customers shift from Capex to Opex, EaaS helps customers keep expenses in line with revenue and better manage costs. At the same time, transitioning to an EaaS business model helps you generate subscription revenue, which is more consistent – and resilient – than equipment sales.
Smart, connected IoT products
What does the future of smart, connected manufacturing look like? Some of our customers are showing the way. Dürr, which makes and services robotic paint stations used by major vehicle manufacturers, has customers that needed to avoid expensive errors during painting. With real-time data on its paint stations, it’s reduced errors as well as cut manufacturing costs for them.
PRAB, which makes metal recycling equipment, has been installing sensors to collect live data on conditions such as temperature and vibration. Its customers now know how their equipment is performing and get insights that help them prevent downtime while improving ROI.
Lyreco, which supplies coffee machines for businesses, was having trouble assuring inventory and coordinating service trips efficiently. With embedded sensors, the company can automate management of its machines and inventory based on real-time usage, saving both fuel and money.
Gardner Denver, an industrial equipment distributor, needed to gather equipment performance data and share it with multiple regional partners for service calls. In just weeks, the company built an IoT-powered condition monitoring solution for real-time insights that coordinate repairs more efficiently and minimize customer downtime.
SMC, which makes a range of air compressor equipment, needed new ways to keep its customers running smoothly. Its “smart field analytics” approach, delivered to market in less than 4 months, uses IoT-enabled sensors to predict equipment maintenance needs and avoid downtime.
What do these manufacturers have in common? Though they’re operating in different industries and dealing with a range of challenges, smart, connected devices are helping transform their businesses with better insights, enhanced customer service, and new sources of revenue.
Want to learn more? Read our ebook, Smart, connected products, to see how manufacturers are building smarter products to get faster, more sustained value. And if you’re ready to take the next step, contact us to learn how our Cumulocity IoT platform provides all the capabilities you need to deliver smart, connected products.