Machine-to-machine technology boosts bottom line

Companies tap innovative methods to streamline the supply chain

Thanks to machine-to-machine intelligence, an Italian washing machine company realized it could give away its washing machines to consumers, then charge them on a pay-per-load basis using wireless-monitoring devices.

Machine-to-machine intelligence is slowly but surely becoming a part of our everyday existence. The long-term business repercussions are probably greater than you think, streamlining the supply chain, fostering the growth of services, and more.

WhereNet, maker of Real Time Location Systems, is launching its Machine Messaging solution this week. The system enables a parts bin in an automotive plant to recognize when parts are running low, based on the bin's weight. The bin will send a wireless message to the material handler, either a person or robot, for a refill and another message to the enterprise planning application to execute a purchase order to the supplier.

As machines produce parts, they need servicing continuously, or they fail. The WhereNet system also measures how many times the machine does something and sends that information wirelessly to the WhereNet server. The server interprets the data and sends it to another machine upstream, which sends someone out for preventive maintenance.

Monitoring the health of equipment could be a boon for companies. Machine-to-machine intelligence allows traditional manufacturing firms to transition to services. Selling not the machine but the maintenance is where the profits will be in the 21st century.

An engineer at a General Electric jet propulsion facility told me the company could give away the jet engines and make ten fold more on the service and maintenance contract using machine-to-machine technology. Imagine how much more the company could make if the engines had sensors to alert GE of problems in between the regularly scheduled maintenance.

"[Manufacturers] used to build a big dumb block of metal, sell it, and we wouldn't see the customer for 15 or 20 years," says Ian Barkin, managing director of The FocalPoint Group in San Francisco. The group's area of expertise is machine-to-machine technology.

There are also implications for consumer-oriented services. BioLab Commercial Water bought monitoring technology from nPhase, an machine-to-machine technology company, and is using it to monitor and remotely control pool-cleaning equipment at every one of its customers' swimming pools. The system gathers and interprets data about customers' pools, then sends all relevant information to BioLab's field force if a maintenance house call is warranted. In addition, it communicates with enterprise applications from SAP, Oracle, and most other companies.

Machine-to-machine communications allow companies to have a lean environment in supply chain, which in turn changes decision-making all the way upstream. Real-time monitoring of a plant's operational needs and the production capability moves up the chain of command to forecasting purchasing and production capability, changing marketing strategy, and ultimately sell through.

You'd best believe that having a parts bin filled with screws at just the right time in your manufacturing facility goes straight to the bottom line.

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