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Fuel Oil News - November 2017

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38 FALL LITERATURE SHOWCASE 2017 | FUEL OIL NEWS | www.fueloilnews.com Digital Transformation may be defined in a number of different ways by analysts or enterprise software vendors. But at its heart is the idea that as we use more digital technologies, those tech- nologies change the way we live and, more pointedly, the way we conduct commerce. Businesses are introducing new technologies in innovative ways to reduce cost, create new revenue opportuni- ties and improve the customer experience. This inexorable trend of digital transformation is clear. What is less clear is exactly which concrete technologies are significant to digital transformation. Connected devices ranging from the Fitbit that monitors our activities and sleep patterns to the con- nected thermostat that allows us to manage the temperature of our house from a cell phone are both examples of how IoT has already impacted consumer products. In the industrial sector, the industrial internet of things (IoT) will likely have an even greater impact. Industrial companies were in many ways early adapters of IoT, and a rudimentary IoT environment has flourished for decades as manufacturing plants, utilities and other heavy industries came to rely on sensored equipment for industrial automation and condition-based maintenance sys- tems. What is different today is that: The cost of adding sensors to equipment is falling. Cloud computing capacity to handle data from a large number of sensors is available. Enterprise software is evolving to operationalize data from these networked devices while also using the data as a source of information for decision support. Ma nu f a c t u r i n g o p e r a t i o n s departments, maintenance departments and field service orga- nizations are also finding that data from these connected devices can enable them to increase value to internal or external custom- ers, reduce cost and even create new product or service offerings. Often, data from these connected devices is consumed strictly on the plant floor—either by networking programmable logic controllers (PLCs) to each other, to a supervisory control and data acquisition (SCADA) network or to other point solutions. The greater potential for IoT to fully impact industrial organiza- tions though will take place as enterprise software like enterprise resource planning (ERP), enterprise asset management (EAM) and, increasingly, field service management, exposes this data in ways that adds value to customers and other stakeholders. A study based on a survey of 200 manufacturing and con- tracting executives with decision-making power over IoT purchases illustrates: The relationship between IoT and readiness for digital transformation How widely IoT data is used within industrial organizations Whether industrial organizations are adopting more advanced use cases for IoT data The degree to which enterprise software helps or hinders full IoT adoption How industrial companies plan to invest in IoT in the next two years How well IoT data is being used to facilitate aftermarket service of industrial machinery and other capital assets Future IoT investment plans of industrial companies There is a strong correlation in the study between companies who said their enterprise software prepared them well for digital transformation and those who said their software prepared them well to consume IoT data, which is expected. Companies that said their enterprise software prepared them well for digi- tal transformation however were able to make better and more complete use of IoT data than other respondents. Also remarkable was the fact that 30 percent of respondents reported using IoT to support field service management initiatives in addition to or instead of their own internal operational processes. This suggests that IoT could give elite manufacturers and contractors a competitive edge when it comes to servitization and gaining revenue after the initial sale. l F O N This article is adapted from the executive summary of a white paper commissioned by IFS, and published in September. IFS devel- ops enterprise software for customers who manufacture and distribute goods, maintain assets, and manage service-focused operations. For more information about IFS, visit IFSworld.com. The white paper is online at https://www.iba-international.com/ media/media_tCnXN.pdf. INTERNET OF THINGS AND DIGITAL TRANSFORMATION BY CHARLES RATHMANN, SENIOR MARKETING COMMUNICATIONS ANALYST "Connected devices ranging from the Fitbit that monitors our activities and sleep patterns to the connected thermostat that allows us to manage the temperature of our house from a cell phone are both examples of how IoT has already impacted consumer products."

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