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Taking cues from throughout the series, it is time to gather all the information and put it to use. Learn how to utilize the Connected Reliability Project Scorecard to capture and compare potential ROIs for new connected projects.
Welcome back to Noria’s new web series called “The Internet of Reliability.” I’m your host, Jeremy Drury of IoT Diagnostics. We’re working to help guide you into a data-driven, internet-connected reliability operation.
We’re in the home stretch with just two videos to go, so let’s wrap up everything we’ve covered so far and pull this into a way for you to score and compare the return on investment (ROI) for different types of pilot project build-outs.
Before we get into that, it’s important to know who should be involved with these types of project-comparison opportunities. More than likely you will have to own it, but you probably will also need to talk to your information technology (IT) department. In addition, you may need some higher-level buy-in from a financial or capital-expenditure standpoint, and you likely will need to talk to an IoT platform provider to help build out the scorecard.
What is this scorecard I’m talking about? We’ve created a model I like to call the Connected Reliability Project Scorecard. It’s a way to compare these different types of projects. The scorecard looks like a traditional grid matrix with four separate quadrants. There are two core upper guides to each side of the quadrant, which are the application side and the investment side.
On the application side, each quadrant breaks down into what I call complexity and consistency. This has to do with the build-out of the actual project itself. When I think complexity, it involves the things we’ve talked about before, like the digital and physical installation environment. This would include things like where in your plant these devices will be, how close to network access points the devices will be and how deep inside an asset they will be.
When you get to the consistency side of things, consider how critical the application is that you are monitoring. Is this the type of application where you need to constantly send high levels of data in seconds or minutes? Think of uptime-critical applications, such as injection molding, where every second counts and you want to know about every piece of data that’s coming in. Or, is it a level sensor on a tank or tote in a warehouse that’s in the middle of nowhere that you need to ping maybe once a month or every couple of months just to know what the levels are? That would be more on the lower data consistency side on the application.
Again, on the application side, we are dealing with the complexity of the build-outs and the installation, and then the consistency of the data coming in from the IoT-enabled device.
Now let’s change gears and look at the other side, because to do all of this, it’s going to cost us something. That is the investment side. So, the other side of the grid looks at the investment we will be making into this pilot project build-out.
The upper quadrant will be control, and the lower one is cost. With control, it boils down to how much will you try to do on your own versus outsourcing to an IoT platform provider. How much do you think you can do in-house versus using other resources to help you build it out?
Another part of control deals with cybersecurity. What is your approach to security on the kind of information that will be leveraged in this type of application? Are you OK with sending data out of your organization? Perhaps more importantly, are you OK with data coming into your organization for things like firmware updates and different types of applications?
The cost is exactly what it means. When you start to put all these things together, what will it take to fund a project such as this? You will have some type of upfront capital expenditure for the sensors and devices. There also may be some type of trailing “as a service” (aaS) type of pricing that goes along with a project like this. These would be things like if you have a web application that goes along with the product or some type of IoT platform that may be a cost to your organization. If you are connecting a device via a cellular network or some sort of IoT/narrowband-IoT type of network, that also will come with some type of monthly cost. So, as you are trying to build out your ROI, you will want to keep track of both the upfront and ongoing costs that a project like this would incur.
We now have the grid built out at this point. Again, application and investment can be broken down into complexity, consistency, control and cost. It’s simple but very effective.
As you continue inside each grid, you must start the measurement process, because everything needs to be measured. The best way to do this is to look at things as low, moderate or high.
Let’s go back to the example from earlier and talk about consistency. With an uptime-critical, every second or every minute type of data push that would come with an injection-molding application, I would consider that to be high consistency. It would be a high cost of consistency or at least a high push of the data that’s coming through, as opposed to the level-sensing application on a tank in the middle of nowhere, which would be a low investment when it comes to that side of things.
As you plug in data points, score them with either a low, moderate or high cost factor to find patterns in the overall scorecard build-out. You’ll then know potentially what you’re getting yourself into as you start to compare these projects.
The final step is trying to find quantitative values and then digging a little deeper. What would be a low cost for you? What would be a high cost? Again, let’s go back to that same scenario. You need to find out how much data is being submitted every minute. Is it 1 megabyte per minute, 1 kilobyte per minute or 20 megabytes per minute? If you’re paying for the data, 20 megabytes per minute gets expensive. That would immediately be a high-cost flag for these early types of project build-outs.
Once you have all the information you need with low, moderate to high scoring, as well as some financial and other quantitative data plugged in, you can take 10 types of projects, lay them out and compare them next to each other to ultimately find the best ROI for your first internet of reliability project build-out.
We’re going to stop there today. On our final episode, we will put some legs behind this. I’ll show you a real application where we will fill out this scorecard together and show you how to get started. So, thank you for joining me again for Noria’s new web series called “The Internet of Reliability.” I’m your host, Jeremy Drury, and it’s been a pleasure being with you today.