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The Industrial Internet: Disruptive, Innovation, Readiness

If you search the Internet for information on asset management, the Internet and Industrial Internet of Things, digitalization, business trends and business reengineering, you’ll find a considerable increase in the number of articles with headlines heralding or promising significant and “disruption” or “disruptive” change.

It’s wiser to focus on how to extract value from what you have and spend time creating the vision of where you want to go on the digital journey.

Products & Industries Rocked by Disruptive Technologies
Established Technology Disruptive Technology, Apple’s New iPad: A Disruptive Innovation by Tim Mojonnier
Mini-computer PCs and networked Workstations
Full Service Stock Brokers On-line Brokers
Bricks and Mortar Retailing On-line Retailing
Standard Textbooks Digital Textbook Publishing
Offset Printing Digital Printing
Open Heart Surgery Anthroscopic and Endoscopic Surgery
PC Computing Tablet Computing

Usually, people consider disruption a BAD thing, but these headlines speak to goodness and of something better. What does disruption mean in this context? Certainly, let’s hope, the chairpersons and chief executive officers of organizations know and have devised elaborate long-term plans to leverage this cure-all for their organizations’ prosperity!

Well, no, sorry, wrong, they don’t and they haven’t.

There is so much confusion, misinterpretation and misapplication of the disruption term in the business leadership community, and more so in the industrial community. Too often, the word disruption promotes a product or is used as visual “bait” to gain interest and access for product demonstrations. After all, you don’t want to be the one to miss the big opportunity, do you?

At other times, disruption becomes confused with innovation, reengineering and continuous improvement.

Technically, when discussing disruption in a business sense, it’s really about “disruptive innovation,” a term of art coined by Clayton Christensen, the Kim B. Clark Professor of Business Administration at Harvard Business School. In his book, The Innovator’s Dilemma, Christensen describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors.

On the consumers’ side, they’ve experienced and have come to expect disruptive innovations. Take examples like the evolution from rotary dial to smartphone; desktop to tablets; and the shift from store-based boxed movies to algorithmic streamed movies while sitting in the comfort of your home.

It’s important to highlight, as Christensen points out, that each of these product or service examples took a lengthy period to occur and have been usually generated by start-up companies.

So, where are the disruption examples in the industrial world? Where are they on the factory floor? In the maintenance and repair process?

Many would have you believe that the Industrial Internet of Things (IIoT) is the disruptive innovation. Others, this author included, say NO.

Certainly, many wonderful changes are occurring in the industrial space. There’s increase usage of sensors/condition-based monitoring capabilities; robotics/automation continues to expand; and a few original equipment manufacturers that both sell software and manufacture assets/products are doing a bang-up job connecting and making them smart. But, smart doesn’t mean disruptive.

The dictionary meaning of innovation is something new or a change made to make a product or service better. IIoT is innovation. It’s business process reengineering, its improvement, it’s certainly change, but it does not yet meet the rigor of Christensen’s definition of disruptive innovation:

a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors.

No significant displacement has occurred in the industrial space, but in fairness, aspects of IIoT over an extended time may morph into disruptive change. There are indications that certain products are beginning the Christensen criteria journey, such as drone-based digital inspection or machine learning/AI, but IIoT is not yet the disruptive panacea often lauded. Someday, but not today.

Organizations on the chase to find disruptive innovation need to stop and refocus. Finding the next GREAT thing is too problematic. It’s wiser to focus on how to extract value from what you have and spend time creating the vision of where you want to go on the digital journey. Too many companies don’t have a digital vision, a culture of neither innovation nor continuous improvement. Too many companies do not embrace the principles of reliability that Uptime magazine sponsors. Living these fundamental business principles are foundational requirements for any successful digital transformation with the innovations IIoT offer.

Tell your organization to forget the technical definition of disruptive innovation and replace it with a simpler one:

Challenging the maintenance status quo with smart digital capabilities

Once you’ve accepted this mantra, then your journey into the digital IIoT can begin, with your strategy embracing your company’s AIM and culture. Think of it as of smart maintenance practices infused with smart digital solutions tied to achieving short and long-term organizational goals. It’s the convergence of the practical with the possibility within the industrial space.

The bottom line is this: The industrial space, generally, isn’t ready for disruptive product innovation. That’s going to come from the outside, possibly from the consumer sector, as the line between consumer and industrial processes blurs even more. More worrisome is that the industrial space is not more prepared for the IIoT, with too many companies lacking strategy, culture and capital plans.

The opportunity for the industrial sector is massive, but more organizations need to wake up to the realization that digital/IIoT, innovation and reliability engineering are the true keys to organizational success.

John Murphy

John R. Murphy founded Gallatin Management Services in 2016 and recently joined as Senior IoT Leader. For 34 years prior to starting Gallatin, Mr. Murphy was Chief Mechanical Officer – Engineering and Strategy at CSX, a leading freight transportation company.

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