In this special blog series, Digital Transformation & the Evolving Role of ERP, we’ll discuss ERP’s new place at the heart of Manufacturing’s digital transformation. From business analytics to artificial intelligence and the Internet of things (IoT), you’ll learn about the cutting-edge technologies disrupting how manufacturers do business.

IoTFitbit. Amazon Echo. Nest Thermostat. While the Internet of Things (IoT) may not be a household phrase, its effects are felt by most Americans whether realized or not. Objects equipped with data-capture technologies are now collecting and transmitting information on everything from temperature and air conditioning to location and movement. What doors do these insights open for manufacturers?


Improving Operations

The success of your manufacturing operations already depends on the performance of sophisticated equipment. However, when integrated with IoT, the manufacturing floor is transformed into a highly connected cyber-physical system. Depending on the setup, machines may be recording and sending data – or they may also be configured with instructions to act on certain inputs. This ability to analyze and act upon data inputs is where the value of IoT lies.

Manufacturers who are able use IoT technologies to glean information on usage and performance – and then feed and apply this data through their ERP system – will be able to quickly respond to and proactively prevent operational issues. With intelligent equipment, manufacturers can:

  • Prevent production delays
  • Predict maintenance needs and how they will affect uptime and performance
  • Carry out critical repairs as quickly as possible
  • Reduce energy usage


Increasing the Value to Customers

By leveraging these same tools, manufacturers can track data related to not only a product’s movement through the supply chain but also its performance aftermarket. Many manufacturers are designing products to emit a sort of “digital exhaust” – or a data stream containing usage metrics such as speed and energy consumption. Using these insights, manufacturers can deliver additional data-driven benefits throughout the customer lifecycle, including the ability to:

  • Better forecast spare parts needs globally so they can be delivered in a timely manner
  • Analyze real-time data from channel partners to make better operational decisions (e.g., identifying a defect yet to be identified in a production run)
  • Consider a dynamic pricing model, where availability and urgency can inform pricing and fulfillment decisions
  • Create digital platform where customers can manage warranty claims and schedule services in one place
  • The result? The value proposition for data-enabled companies moves from their core offering to include the insights gathered and value-added services recommended along the way. For example, Fedex has noted that the data they can now report about their packages from their IoT platform SenseAware has become an invaluable part of improving their service.



To reap the benefits of IoT in manufacturing, you’ll need ingenuity and tenacity – but also a great deal of expertise. With unprecedented data streams, you’ll need both the know-how and the resources to integrate various software, including your ERP system, in order to combine and leverage raw data effectively. The ways you store and manage data may also need to be rethought.

Laying the groundwork may seem daunting, but for manufacturers who see the long-term value of this investment, the time is ripe to seize a competitive edge before this quickly emerging technology enters the mainstream.