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How Internet of Things (IoT) can generate value for ERP and the Manufacturing Industry

How Internet of Things (IoT) can generate value for ERP and the Manufacturing Industry

How Internet of Things (IoT)can generate value for ERP and the Manufacturing Industry

The Internet of things is the network of physical devices, home appliances, industrial gadgets and other items embedded with a variety of objects including electronics, software, sensors and more, wherein these objects connect and exchange data via network connectivity. According to the experts, the IoT is expected to reach about 30 billion objects by 2020. It is also predicted that the value of the global market for IoT will reach $7.1 trillion by 2020.

With Internet of Things rapidly expanding and penetrating our lives like never before, the world is getting more interconnected with rapid exchange of information, wherein these devices collect and communicate data. But, have you ever interacted with an IoT enabled device already? Here are some of the examples:

  • Hotel check-ins, based on smartphone
  • A smart security system
  • Connected cars (through Wifi and internet)
  • Wearables

Knowingly or unknowingly, you might have encountered some of these systems, which means IoT is already creating waves in the market. To put it in simple terms, the application of IoT is steadily increasing with the world slowly becoming more and more connected, with huge amount of data being collected every second. Now, let’s examine how this impacts the world of ERP and manufacturing.

IoT Effects on ERP and Manufacturing

 With the traditional ERP systems adopting newer technologies under its fold such as mobility, cloud and wearable technologies, it’s not very far that IoT is going to emerge as the next big revolution in the technological space.

IoT promises to transform the very picture of ERP & manufacturing and here’s how?


  • Instantly communicate – Replenishment and reorders could be instantly communicated to a business’s ERP through the usage of interconnected sensors and devices without any human intervention.
  • Receive notifications – By reducing a lot of human interaction with machinery and data, lean manufacturing could get little bit leaner. By leveraging IoT, manufacturers can receive warnings and notifications, when products need attention or repair. However, businesses are required to successfully adapt their processes to this new technological model and also respond accordingly.
  • Evaluate product utilization – With traditional CRM systems, gauging the customer behaviour might tend to be complex and bit difficult. However, establishing communication directly with products, manufacturers would be able to evaluate how and when products are being utilized and when they could malfunction and need attention.
  • Effectively utilize data –  IoT brings a lot of new data, wherein this data need to effectively collected, processed, analyzed and utilized in an efficient way by the ERP software. This means ERP systems need to be robust to handle the inflow of new information emanating from various devices and products. A manufacturing company, for instance, need to do a lot of ground work and assess many factors. Some of the factors include the size of their present ERP and CRM, how these software tools will integrate with IoT, how will it impact their current manufacturing and sales/customer processes and much more.
  • Judiciously adopt IoT – As already mentioned, there should be high-level flexibility in the workplace to bring IoT into the mix. As IoT is still an emerging technology, organizations would take time to learn and adapt to this new model. However, it is important for an organization to implement a new software or technology to be able to adapt as quickly as possible and generate a plan of action for the whole company to follow. However, a manufacturing organization need to be cautious while implementing Internet of Things, as an overall crucial evaluation and assessment is required, before embarking on Internet of things.

Key IoT Challenges

With Internet of Things generating a lot of value for ERP and the manufacturing industry, this technology is also fraught with some challenges. Let’s examine some of the crucial challenges here:

  • The biggest concern is data security. While Internet of Things generates a lot of data to the advantage of manufacturers, it also provides a chance for the data to be breached with specific reference to mobile devices or wearable technologies. As the technology is new, IoT users need to work out a solution to secure large amounts of data, particularly from sources like mobile.
  • As IoT investments are huge, some small to mid-size manufacturers may not afford, proving to be a major damper.
  • Data analysis from IoT is still at a nascent stage, which implies that manufacturers have to manually analyze through large amounts of data, which is time-consuming and subject to errors.

However, despite the challenges, the overall picture of IoT looks bright and promising and is only going to get bigger in the coming days. With the advancement of technology in the manufacturing industry, you can expect software companies to explore newer ways to tap the potential of IoT and start devising innovative ways of processing and comprehending technology and communication from all kinds of sources.

To know more about IoT and how it can add value to your existing manufacturing business, please get in touch with us on at marcom@localhost or call us at +91 40-69000226.