IoT-equipped products have the potential to hugely reduce the cost and time involved in detecting and correcting faulty products.
When most people talk about the IoT, the immediate connotations are of the consumer side of the technology: the futuristic, high-tech houses where appliances speak to each other and anticipate their owner’s every need. But, the impact of the IoT will likely first be felt in the industrial sector, where smart machines and data analytics could have a huge impact on a wide range of traditional manufacturing, infrastructural and maintenance projects. One area in which IoT solutions can potentially add a great deal of value to the manufacturing process is in error detection and correction.
Warranties versus data
Today, when an error in a product occurs, the usual means of managing it is through warranty submission analysis. Let’s use an example to illustrate the process and structure. Say there is a fault with a car, picked up by a consumer who submits a warranty to the manufacturer. The next step is that the vehicle is submitted for inspection which creates data that can be analyzed and action taken to deal with the issue. Part of this resulting action could be a product recall (which one North American automotive manufacturer indicated can equate to US$1m a day in warranty and recall related costs). The entire process of warranty-based correction can take between 120 and 200 days.
Now, let’s say an IoT-fitted, connected car breaks down. At the moment of breakdown, the sensors in the car create what is known as a diagnostic trouble code (DTC), a data set capturing the exact digital status of the vehicle at the moment of failure. This data is then transmitted to the manufacturer, where it is analyzed and actioned. IoT solutions such as this can cut up to 90% off the detection-to-correction (D2C) times, down from hundreds of days to just a few weeks, or even a few hours. IoT solutions can also capture data on device conditions that a conventional car wouldn’t, such as driver behavior, leading to more accurate and valuable diagnostics. Overall, IoT solutions could save manufacturers about US$1.8b per incident (see diagram).