When we talk about Internet of Things, most of the discussions center around the future. We quote reports and surveys suggesting how IoT will change things and save companies millions of dollars. But in this article we will talk about a company which is actually reaping benefits of Big Data and Internet of Things as of today and saving millions of dollars every year and also helping other companies to do the same. The company in question of Caterpillar, the Illinois-based construction equipment maker. Caterpillar uses data collection and predictive maintenance analytics to refine its operations and planning.
Caterpillar has a special division called “The Marine Division” which performs fleet operations serves shipping vessels. James Stascavage, intelligence technology manager at Caterpillar Marine, says that the primary reasons behind Caterpillar’s success is that the company focuses on small things which could improve its operations efficiency instead of searching for “Grand Slam” effects, for which most of the companies wait pointlessly. They wait and search for a big factor which would change the company’s expenditures and costs, but the reality is that savings from small things add up every year and result in sizable cash.
Caterpillar has its own Asset Intelligence platform which is used by the company to use data from Internet of Things devices on its vessels and machines. The platform is then used to make sense of data and find correlations. For example, Caterpillar found through its IoT platform that fuel meter readings are correlated with the amount of power used by refrigerated containers. This data point was extracted using Shipboard sensors which monitor generators, GPS, air conditioning systems and fuel meters. Caterpillar is now using this data to optimize its operating parameters, by simply changing power output from the generators. The company later found out that running more generators at lower power was a more efficient than running a few generators at their maximum power. This resulted in cost savings and increased efficiency. Caterpillar an its customers on average save around $30 per hour due to this data point discovery, which was made possible due to Internet of Things. Scale this hourly saving to the fleet of 50 operating all day long for 26 weeks a year, and you have a total savings of a whopping $650,000 a year.
Asset Intelligence platform is built on the data integration platform made by Florida-based business Intelligence software company, Pentaho.
Another important discovery made by the Internet of Things platform of Caterpillar was about hull cleaning. Ship hull gets eroded due to sea water and environmental factors. Companies spend a fortune every year on hull cleaning. For example, a customer company of Caterpillar used to spend about $20,000 on hull cleaning a year. Using Internet of Things assets intelligence platform of Caterpillar, the company found out that hull cleaning is done on frequent basis, it could save a lot of money. In a fleet of 8 ships, the company used to spend $5 million every year. But after switching to frequent cleaning, the company now saves around $400,000 per ship, thanks to the Internet of Things platform.