Amazon’s Next Frontier: Manufacturing & the Industrial Internet

Customer demand for faster, smarter, more connected products has given rise to the Internet of Things. This constantly growing network of home and personal devices has the capability to connect and share data with the internet and each other.

In the last decade, the supply chain has seen its own unrelenting demand nudging for faster, smarter, and increasingly connected factories, warehouses, and distribution channels, with the goal of outputting increasingly connected products. And why not? It is indisputable that such connectedness brings more productivity than anyone thought possible even 20 years ago.

Image courtesy: Pixbay

Image courtesy: Pixbay

But as supply chain executives and leadership at manufacturing-heavy industries work tirelessly to try and keep up with the latest technologies, one large concern looms: Amazon. Jeff Bezos, Warren Buffett, and Jaime Dimon just announced they plan to enter the health care space, and the supply chain can’t help but wonder, “Are we next?”

We certainly are. A recent Harvard Business Review article suggested that Amazon is in a prime position to enter the Industrial Internet, or the world of products with physical components where digital technologies are becoming integral to the products themselves. It’s the world where sensors, electronics, and software meet nuts, bolts, and metal.

The Industrial Internet

The goal of the Industrial Internet (often called the Industrial Internet of Things, or IIoT for short) is to connect all aspects of industry to make it more flexible, agile and responsive, creating a data-driven reorganization of the supply and distribution networks. The IIoT is a huge space in which manufacturing companies across the country are striving to merge their product-based companies with ever-evolving technologies. Our space.

Many economists believe the industries we run — those that rely on heavy machining and efficient supply chain and logistic operations — are the next frontier in business. GE thinks of the IIoT as the next Industrial Revolution. People are genuinely excited about the potential for growth in creating smarter machines and advanced analytics to drive more efficient operations. Is it any wonder that Amazon wants to be involved?

The good news

The challenges we face as manufacturing and logistics companies with integrating technology into our businesses need not be re-hashed for this audience. But the HBR article also cited some challenges for a digital giant like Amazon to enter our space: lack of knowledge of the physics of the hardware and the operations of the business, as well as an initial inability to match current customer intimacy and trust in the existing brands. So, there’s some good news.

The other good news, of course, is that our industries are poised for potentially massive growth over the next decade.

As lines between the physical and digital worlds continue to blur, we’ll see continued convergence of industrial and technological world. This momentum is gaining speed and will rapidly change the way our businesses collect, share, and analyze information and goods, making us smarter, faster, and more connected from production to delivery.

Will Amazon enter the Industrial Internet space? Of course. How could they not be a player in a game this big?

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