IoT & Industry Regulations: New Standard in Global Business

Manufacturing is reputed to be an industry that is less bound by regulatory restrictions than others.Meanwhile, Internet of Things remains a topic seen as more of an consumer trend than something that will impact manufacturing. Both these assumptions are wrong.

But as a large category of industry, manufacturing often intersects with business areas that are indeed regulated, and the trends strongly indicate that standards and regulations will be increasing, not decreasing. Manufacturers' products containing hazardous chemicals already must comply with USA's OSHA and the Globally Harmonized System of Classification and Labeling of Hazardous Chemicals (GHS). Contract manufacturers of products containing electronics need to be aware of international regula­tions such as the EU's RoHS2. These are just two types of the commonly required regulations manufacturers may encounter.

And as more and more products are manufactured with Internet-ready components, “smart products” will include Internet of Things (IoT) for manufacturers to remotely monitor and service equipment, measure vibration, temperature, pressure, and other factors that can cause disruption and downtime. These products incorporating IoT components will often need to be regulated in order to ensure accuracy for manufacturers and to provide safety for users. And as to the dramatic nature of the impact of IoT on the flow of goods in the global supply chain, Verizon, one of the major corporations that will be carrying IoT data from products to the Cloud, states in a recent report, The Internet of Things 2015: “It's not hype. The Internet of Things (IoT) is already having a massive impact on business…53% of manufacturers will offer smart products by 2016…”

Regarding regulations associated with the proliferation of IoT, Oxford Economics, a consulting group affiliated with Oxford University's business college to provide economic forecasting and modeling to UK companies and financial institutions expanding abroad, reported in a recent study of 300 manufacturing executives that “Increased regulations arising from envi­ronmental concerns and standards-based factors like ISO compliance…apply across an increasingly inter-connected world.

So even if manufacturing appears to be devoid of regulations and standards in some sectors, depending on the market, there will undoubtedly be aspects of the regulatory and standards landscape that must be explored in order to success-fully gain global market share. Being proactive and building the readiness to accommodate regulations and standards can give a manufacturer a definite competitive edge.

With increased customer, environmental, and end user concerns for safety, and with many regions of the global marketplace establishing unique sets of standards and regulations to meet the rapid changes in manufacturing technologies and products, it pays to be ready for regulatory compliance. Enterprise Labeling Solutions already contain the ability to easily incorporate regulatory label data while meeting all the other labeling requirements of a manufacturing operation.

Does your organization find itself at the cross roads between IoT and industry regulations? How are you managing this new terrain?

Editor's Note:

Greg Graham, manufacturing industry specialist (Southern Region), Loftware, and Justin Ward, manufacturing industry specialist (Northern Region), Loftware, were additional authors on this blog.

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2 comments on “IoT & Industry Regulations: New Standard in Global Business

  1. docdivakar
    May 29, 2015

    RoHS2 regulation are not specific to IoT and apply to all electronic hardware. As regards to “smart” products incorporating IoT that the author claims will need to be “regulated”, I am not sure if regulation is the operating word! All components that constitute an IoT product go thru reliability tests as is the normal practice. More over, IoT does NOT make any product safe, it only reports its state of operation. For example, a bridge being monitored for earthquakes by a sensor network owes its safety to the bridge design itself and NOT the IoT network! The safety of the bridge is covered by the regulations like International Building Code (IBC), Federal Highway Admin (in the US for example), etc.

    I don't believe in new regulations for IoT other than what already exist in the electronic industry.

    MP Divakar

  2. Deborah Grant
    June 1, 2015

    Thanks very much for your comment, Mr. Divakar.  I see from your Linkedin profile that you are an esteemed researcher in Silicon Valley, and I appreciate your taking time to read my article.

    This blog was taken from a much longer article that had been divided into four parts, as a series.  This may have caused a little bit of confusion in the presentation of this material.  Of course you are correct in stating that RoHS2 applies to all of electronics under the jurisdiction of the European Commission, to better control the proliferation of hazardous materials in the environment (for other readers, a FAQ sheet can be found at the European Commission website).  

     Also, just to clarify on your point about regulations for IoT.  My organization provides Enterprise Labeling Solutions that are “agnostic” regarding regulations and standards.  We have observed, however, that standards and regulations are frequently changing, and even increasing, in a variety of industries today, including electronics.  There is an irreversible trend toward benchmarking standards, which subsequently often become regulations.  I can envision a world in which products containing IoT objects could become subject to special standards, and in turn become more regulated. In today's regulatory environment, it is difficult for organizations to keep up with all the labeling changes required. My relevant point here is that Enterprise Labeling Solutions can easily accommodate any standards or regulatory requirements for changing label data.  For more information about Enterprise Labeling, you might enjoy a joint report by VDC Research and Loftware on the Loftware website, titled “Enterprise Labeling–A Supply Chain Strategic Imperative.”

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