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The ROI behind private wireless and industrial edge revealed

The ROI behind private wireless and industrial edge revealed

A few months ago, I wrote a blog about the common misconceptions we saw around private wireless networks. One was a lack of clarity about the ROI (return on investment) of deploying a private network. So, I decided to dig a bit deeper and ask the early adopters of industrial digitalization what they saw in terms of ROI when deploying solutions like private wireless and industrial edge. How does digitalization impact KPIs like worker safety, quality, and sustainability? I was hopeful the data could help others progress faster as ultimately Industry 4.0 will improve sustainability, safety, and productivity targets — all good for society and our planet.

Analyst house GlobalData helped us interview 79 early adopters across manufacturing, energy and transport hubs that had already deployed or were deploying private wireless and digitalization solutions. Here are some of the key findings.

The top three: improved worker collaboration, material flow and production quality

When asked about the achieved results following a private wireless deployment most respondents see improvements of more than 10 percent in their internal metrics across a wide range of performance areas, with many reporting more than a 20 percent improvement. Nearly all interviewed (95 percent) see an increase in worker collaboration and decision-making, followed by optimized internal material flow efficiency, production quality (both 74 percent) as well as emission reductions (70 percent) and operational cost reduction (69 percent). Video analytics supported by a low latency environment increase the ability to monitor sites and equipment for efficiency, maintenance, security, and safety purposes. Connected workers enable an improved allocation of personnel and safety. Asset tracking was also mentioned to reduce loss and increase efficiency.

Benefits achieved by early adopters from private wireless solution

Sustainability, reduced energy costs and improved worker safety

The ROI research is very comprehensive, so please download the full report, but I want to call out worker safety and sustainability as these metrics benefit our planet and society directly. We asked the early adopters to what extent they were able to reduce accidents and/or improve worker safety. In the table above 61% saw an increase of over 10%, but looking at the raw data, 93.6% of all early adopters saw an improvement in worker safety or a reduction in accidents.  

In the sustainability area, we asked them about emission reductions and reduced energy consumption. Here 70% saw improvements over 10% and 95.6% saw some improvements.

In this current climate where energy bills are going up, another vital data point was a reduction in energy and 94.7% saw their consumption go down, with nearly 50% seeing a reduction of over 10%.

Over 85 percent see cost reduction within six months

Often a business case needs to be presented before digitalization solutions like private wireless or industrial edge are approved. When innovative technology is involved like-for-like comparisons are often difficult and rip-and-replace is unlikely to be acceptable, so some of these data points might help. Sometimes the drivers are more around cyber security. It is not uncommon to find entire factories being run on a Windows 95 PC, so an upgrade in technology with watertight security measures is a requirement to adopt new cloud-based applications.

We asked the early adopters what impact on the total costs of ownership they had achieved when they deployed private wireless or industrial edge technology and how long it took to see costs benefits. 85% saw cost reductions when deploying private wireless and industrial edge and over 50% of this group saw cost reductions of 6% or more with 29% experiencing more than a 10% cost reduction. 79% of the audience saw an ROI within 6 months, with 21% of that group seeing an ROI within a month.

Impact on TCO for early adopters of private wireless and industrial edge technology

How do early adopters approach digital transformation?

Digital transformation of industrial campuses is about more than deploying reliable connectivity. 94 percent of early adopters have deployed a private wireless and/or Wi-Fi network together with new applications such as predictive analytics, AR/VR, and industrial twins. Over 63 percent of early adopters already use some connected industrial devices like worker handhelds, work pads and wearable cameras. An industrial edge can run digital applications, process and store data locally, and can orchestrate the interworking between the LTE/5G and Wi-Fi functions, as well as interface with the wide area network and public cloud ecosystem.

79 percent of the early adopters see the benefits of working with a vendor who can provide an end-to-end approach when embarking on a digital transformation journey. Reasons for this are fewer suppliers to manage (46.8 percent) increased ROI (45.5 percent) and lower TCO (total cost of ownership) (39 percent). Reduced deployment time was also mentioned as some of these solutions are pre-integrated (32.5 percent).

Helping you with your digital transformation business case

Download the full report here to help you with your business case proving the ROI of industrial digitalization. Nokia is the only vendor to provide one platform for industrial digitalization, because we understand that all the parts must work as one with your legacy machines as well as your people, so we want to make this transformation as simple as possible. We provide the private wireless and/or Wi-Fi connectivity, the industrial devices, edge, and applications you need to make an impact for your people, the planet and your bottom line.

Carlijn Williams

About Carlijn Williams

Carlijn Williams currently holds the role of Head of Marketing for Nokia’s Enterprise Solutions business. She talks about how (5G) private wireless networks and solutions like edge cloud, devices and applications continue to change vertical industries. She gives insight in how industries can succeed in their digital transformation by using low latency, high bandwidth mission-critical communication networks. She believes topics like Automation, Security and AI-driven applications are vital to accelerate Industry 4.0. Dutch born, Carlijn holds a degree in Economics and Communications and lives in the UK.

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