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Midokura 2017 Predictions: An Intelligent Network for Connected things

VMblog Predictions 2017

Virtualization and Cloud executives share their predictions for 2017.  Read them in this 9th annual series exclusive.

Contributed by Susan Wu, Director of Technical Marketing at Midokura

An Intelligent Network for Connected things

The most valued corporations in the world will be digital companies. The transformation that started in the front office will make its way throughout the value chain through the use of digital tools like cloud, mobile, social and most importantly data and transform these business dramatically.

According to Gartner, there are 2.4 billion connected things for commercial use worldwide in 2016. But only 30% of the organizations know what the connected things are on the network. Manufacturing is one of the industries being re-imagined by digital transformation. With the rise of industrial grade apps that provides predictive maintenance for factories, plants and fleets of assets that are always online, factories of all sizes will need an intelligent network infrastructure for availability and scalability.

Prediction 1: IP becomes the standard for Intelligent Factory Networks

With the rapid commercialization of the Internet, machines that used to be networked together in the factory with Ethernet are being networked with common internet (TCP/IP) protocols. Use of common protocols is enabling IT and OT systems to share information, reducing the complex interactions between the two disparate systems, "aka IT/OT convergence", giving rise to precision manufacturing, higher productivity, lower waste. IDC research predicts that about 60% of Global 1000 will integrate IT and OT to providing seamless visibility between the shop floors to the top floor by 2018. The Industry 4.0 transformation has begun.

Networked machines are gaining intelligence (through sensors) and can determine health and performance of other machines on the network in real-time. The network effect of intelligence, location-awareness enable machines to implement self-correcting mechanism or optimize themselves for operationally efficiency. IP is becoming the standard for Intelligent Factory networks along with requirements for quality of service (QoS), and network security. The network will play a key role in preserving the integrity of the metadata from the OT devices as the data is processed either locally at the edge of the network or in the cloud.

Prediction 2: Servitization of the Supplier Network

On the road to digital transformation, companies had to re-imagine their value chains, changing the way they think about their products, services, ecosystems, business models and customer experiences. According to AIM Consulting, ⅓ of global manufacturing firms are servitized. In the United States, 58% of manufacturing firms are servitized while 40% of U.K.-based manufacturing firms have moved to primarily selling integrated products and services that deliver value in use displacing standalone products. 

Manufacturers will look for the next level of efficiency by examining their supply chain, changing the way they think about the suppliers and look for ways to "servitized" the suppliers. In the same way that buyers make purchasing decisions based on the promise of desired outcomes from vendors, the manufacturers will look to their suppliers to provide similar outcome guarantees. For example, Tesla customers have already pre-ordered their vehicles and now it's up to Tesla to ensure timely delivery. Tesla acquired Grohmann Engineering to raise production targets by 400%, from 100,000 to 500,000 cars.  However, when acquisition is not financially feasible, it is conceivable to see a manufacturer ask for outcome-based guarantees from their supplier network in kind. This new level of servitization between the manufacturer and supplier spells the need for real-time network infrastructures and inter-company IT/OT system convergence.

Prediction 3: Networking for Digital Twins

The compute and connectivity of today makes it possible to produce a digital representation or "digital twin" of any physical asset like a piece of equipment, plant or even a robot. Product ideas can be tested in parallel before any manufacturing begins. Data from the real machine can be uploaded onto systems and the "digital twin" can simulate changes and/or perform modeling to create new business or service models. Moreover, the knowledge and expertise gained from developing industrial digital twins for physical assets can be applied to improve workforce productivity. Innovative automotive manufacturers are contemplating modeling the interactions between the technician and the robots in tandem to reduce robotic motions and to reduce repetitive stress for the person.

IOT can potentially transform the global workforce at large and unlock the next level of human and machine productivity!


About the Author

Susan Wu is the Director of Technical Marketing at Midokura. Susan previously led product positions for Oracle/Sun, Citrix, AMD and Docker. She is a frequent speaker for industry conferences like OSCON, OpenStack Summit, Container World, All Things Open, Linuxcon/CloudOpen/Containercon, Interzone, Data360/Cloudcon and Data Storage Innovation. Honored by the Cloud Network of Women (CloudNOW) organization as one of the Top Women in Cloud for 2013, Susan is passionate about advancing womens' contribution to the cloud industry and serves on the Board of Directors for CloudNOW. 

Follow Susan on Twitter @susanwu88

 susan wu


IDC FutureScape: Worldwide Internet of Things 2016 Predictions

What is Industrial Internet? -

Servitization: The Extent of and Motivations for Service Provision amongst UK based Manufacturers - 

Published Wednesday, December 07, 2016 7:06 AM by David Marshall
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