AI Technology: Industry 4.0 is using IoT and AI to expand its digital presence

A growing number of old economy companies are using technologies such as internet-of-things (IoT) and artificial intelligence (AI) to expand their digital presence, taking on IT majors and global diversified conglomerates which are also aggressively muscling into this space. Leading domestic industrial and engineering companies such as Larsen & Toubro, Reliance Industries and the Tata group, as well as multinational firms including General Electric, Siemens and ABB, are all trying to capture a share of the pie and the timing seems just right. Most companies are not making huge investments in expanding capacity, although they see merit in putting money into digital platforms, which help improve efficiency and render more profitable the extant capacity. Industrial firms traditionally entered the services business to offer operations and maintenance support, which gave them additional revenue streams and helped build customer loyalty. Now, they are taking it a notch higher -- by adding sensors to products to provide steady data, and analytics, which predict breakdowns and improve efficiency. "This is a hardware-plus-service business; the value-added services have high margins that will reflect on the bottomline," JD Patil, senior executive vice-president (defence business) and member of the board at Larsen & Toubro, told ET. "Companies like us have an edge because analytics can be done only when you understand the domain very well."