SOURCE: Lux Research

Lux Research

June 14, 2016 07:30 ET

Industrial Internet of Things Bringing "Equipment as a Service" Model to Industry

Predictive Maintenance Technologies Are Driving New Business Models That Promise to Eliminate Capex, Improve Uptime, and Cut Costs, Lux Research Says

BOSTON, MA--(Marketwired - Jun 14, 2016) - The rapid development of the Industrial Internet of Things (IIoT) is ushering in the next generation of predictive maintenance (PdM) solutions for the world's industrial equipment. Along the way, it is driving new business models and creating massive opportunities for vendors and operators, according to Lux Research.

With advances in sensors, connectivity and analytics, PdM -- one of the coveted use cases of IIoT -- is poised for a massive overhaul that will improve asset uptimes and decrease costs, forcing many industrial organizations still living in the maintenance "dark ages" to rapidly embrace change.

"Remote diagnostics and maintenance solutions are a key factor in enabling OEMs to offer equipment-as-a-service (XaaS) models," said Isaac Brown, Lux Research Analyst and lead author of the report titled, "Predictive Maintenance: The Art of Uptime."

"To fully benefit from the new technology, industrial organizations need to rapidly move away from the current practice of fixing equipment only after failure, or at pre-determined intervals," he added.

Lux Research analysts surveyed operations managers across a variety of industries and geographies to evaluate adoption, obstacles and benefits. Among their findings:

  • Wide range of solutions available. PdM programs require vast resources but can be tailored to specific needs to increase uptime and drive down costs. For instance, Monsanto gained $1 million by deploying integrated wireless gateways and failure ratings to 14,000 plant components. Leading vendors include Emerson Electric, GE and Schneider Electric.

  • Varied business models are emerging. Gas compressor maker Kaeser installed processing and communications capabilities on its compressors and uses data to performs predictive maintenance analytics -- but also charges a monthly service fee. Caterpillar, ThysenKrupp and Tennant, among others, are also experimenting with new business models that could eliminate capex, providing "equipment as a service."

  • Adoption is slow. Despite proven performance benefits, adoption of predictive maintenance is slow in some industries. Organization size and region play important roles in the adoption of predictive maintenance and connected solutions. Among industries, energy and heavy industries are much further along than others.

The report, titled "Predictive Maintenance: The Art of Uptime," is part of the Lux Research Industrial Internet of Things Intelligence service.

About Lux Research

Lux Research provides strategic advice and ongoing intelligence for emerging technologies. Leaders in business, finance and government rely on us to help them make informed strategic decisions. Through our unique research approach focused on primary research and our extensive global network, we deliver insight, connections and competitive advantage to our clients. Visit www.luxresearchinc.com for more information.

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