The factory of the future will be more capital efficient and flexible. Updates from product design teams will be introduced more quickly, and customisations incorporated more easily. Schedules will reflect changes in demand within hours, not days. Managers will be able to see what stock and raw materials are on hand, and exactly where they are, from their tablet.

By adopting asset tracking throughout the supply chain — from inbound raw materials and parts to outbound shipments of finished products — manufacturers can reduce shrinkage and damage; and forecast their material needs more accurately, achieving the ultimate in lean operations, lower stock, and fewer outages.

Thinking Big: The shift towards servitization 
Manufacturers of larger goods — generators, elevators, air-conditioning units, jet engines, and medical equipment — frequently already sell maintenance contracts along with equipment.

These contracts are often lucrative, but they create problems for both parties. They require regular inspection and maintenance visits, and customers still experience downtime and an emergency call-out if there's a problem in between visits.

Manufacturers are increasingly moving towards "servitization", where instead of selling products they contract to deliver outcomes. With IoT, manufacturers can remotely monitor the condition of equipment and look for indicators of imminent failure — for example vibration, temperature, or pressure outside normal limits.

This means that the manufacturer can make fewer visits, reducing costs and freeing up employees. For the customer it means less disruption, increased uptime, and ultimately higher satisfaction.

Taking this to the next level, manufacturers can offer a price-per-use, inclusive of all hardware, installation, and servicing. This is servitization, and it's very attractive to customers looking to spread costs and increase accountability.

While the smart home is fairly new concept, sales of wearable computing devices, smart thermostats (like Google Nest), and smart lighting (such as Philips Hue) have been strong, and Verizon's network data shows an 89 percent year-over-year increase in the number of connections for smart alarms, cameras, and other home security solutions.
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