By Keiter CPAs
By Colby Raines, CPA | Business Assurance & Advisory Services Supervisor | Manufacturing, Distribution & Retail Industry Team
How Does the Internet of Things (IoT) and 5G Impact the Manufacturing Industry?
There is no escaping how “smart” things have become today. Televisions, refrigerators, even tennis shoes – nearly everything we use today is or can be connected to the internet! It is estimated by 2020, the number of connected devices worldwide is expected to exceed 20 billion. The Internet of Things (IoT), which can loosely be defined as the interconnection of computing and devices via the internet, is also making its mark on the manufacturing industry as well. It’s not just tech companies that make use of the IoT – manufacturers are increasingly using this concept to increase efficiencies, decrease costs (both direct and indirect), and improve product innovation.
Implementing 5G: How 5G Will Advance IoT Technology
It is expected that improved sensors and the implementation of 5G connectivity will further contribute to IoT expansion in 2019. 5G is expected to offer more than just enhanced speeds; it is also expected to provide digital infrastructure that will help streamline processes for manufacturers. Smart manufacturing is defined by the National Institute of Standards and Technology (NSIT) as systems that are “fully integrated, collaborative manufacturing systems that respond in real time to meet changing demands and conditions in the factory, in the supply network, and in customer needs”. In smart manufacturing plants and factories, sensors will transmit and stream data to the cloud in real time. This will allow for manufacturers to enhance the production process, improve quality, perform preventive maintenance, and improve workflows, among other efficiencies. It is also expected that the implementation of 5G technology will result in smaller and lighter IoT devices, which should produce cost efficiencies and reduce the need for space.
As the manufacturing industry continues to evolve along with these emerging technologies, the workforce will inevitably evolve as well. Manufacturing professionals will need to adapt their skills and proficiencies to meet the demands of these new technologies. They will not only need to have a firm understanding of the intricacies of the machines, components, etc. of what they work with every day, but also develop an understanding of these digital networks and how they interrelate. Fortunately for employees on the warehouse floor, this increased automation is expected to create more jobs than it eliminates – jobs that integrate both human intelligence with artificial intelligence. To fully optimize smart manufacturing and gain a competitive edge, manufacturers will need to invest strategically in these emerging technologies, including employee training and education. To ensure the most success when transitioning, the key will be for manufacturers to instill fully integrated systems rather than attempting to connect individual parts and components.
5G and the IoT are already having and will continue to have a large impact on the manufacturing sector, and as these technologies continue to evolve, it will be important for manufacturers to make sure they are evolving along with them.
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Additional Manufacturing Resources:
2019 U.S. Manufacturers Confident About Increasing Revenue Expectations
Manufacturers and Retailers Face Significant Cost Increases in 2019
About the Author
The information contained within this article is provided for informational purposes only and is current as of the date published. Online readers are advised not to act upon this information without seeking the service of a professional accountant, as this article is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant.