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What is IIoT? The Industrial Internet of Things

Erin Thompson |

The Industrial Internet of Things (IIoT) is changing how industries work by blending traditional methods with digital technology. This shift, known as Industry 4.0 or the Fourth Industrial Revolution (4IR), is predicted to grow the Industrial IoT market to $3.3 trillion by 2030, according to Statista. It involves the use of smart devices and sensors to enhance the efficiency of factories and manufacturing plants.

Industrial IoT connects industrial equipment and systems through the internet, allowing real-time communication. In addition, Industry 4.0, or IIoT 4.0, merges digital technology with traditional industry practices to make businesses more flexible and innovative. This helps manufacturers, oil refineries, and power plants operate more efficiently by enabling tasks like predictive maintenance, remote monitoring, and automation.

Understanding the difference between IoT (Internet of Things) and IIoT is important. While IoT connects everyday devices like phones and thermostats to the internet, IIoT focuses on linking industrial equipment and systems. Industrial IoT combines information technology (IT) and operational technology (OT) to improve efficiency and connectivity in industries, shaping the future of how businesses operate.

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Table of Contents

Table of Contents

Elements of Industrial IoT

Industrial IoT is made up of several different elements, which all work together to make industries more intelligent and efficient. 

Machines & Hardware

Machines use smart devices and controllers to gather and process data. Smart devices, including sensors, actuators, gateways, and embedded systems, collect, process, and transmit data across industrial operations. With these devices, companies can monitor machine performance, save energy, and boost productivity. 

While sensors collect data, controllers, like PLCs (Programmable Logic Controller) and industrial PCs, monitor sensor performance and complete complex control tasks within industrial settings. These controllers run programs to manage industrial processes, ensuring smooth communication between smart devices and enabling automation across the network.


Software serves as an essential tool and platform for data collection, analysis, and management. A well-designed user interface is important to enhancing the usability of IIoT systems. Intuitive dashboards and responsive interfaces provide visual cues, such as charts and graphs, that give insight into their operations. This in turn allows for an interactive experience for operators.

Most organizations use cloud infrastructure that acts as a centralized hub for storing and processing vast amounts of industrial IoT data. Therefore it simplifies data management for businesses, helping organizations facilitate rapid data analysis and gain real-time insights.


Industrial IoT sensors collect live data from various sources such as machinery and production lines. For example, sensors integrated into industrial robots enable dynamic autonomous navigation. These sensors enable robots to gather real-time data, make informed decisions, and communicate within interconnected industrial systems. 

Furthermore, edge computing complements sensors in IIoT systems by processing data closer to its source, minimizing delays, and reducing the need for extensive data transfer. For example, temperature sensors in manufacturing are attached to machinery to monitor if they’re overheating, need maintenance, or to be shut down.


Infrastructure is the backbone of Industrial IoT systems, as it involves the physical and digital framework supporting the connectivity of devices and systems. Infrastructure components include communication networks, and hardware, such as actuators and computing systems, that facilitate the seamless exchange of data between machines. 

Different types of connectivity, like Wi-Fi, Ethernet, and LPAWN (Low-Powered Area Wide Network), help send data quickly to cloud or edge computing platforms. This connection setup helps create IIoT systems that can adapt to different industrial needs and are dependable.

Industries Using IIoT


Warehouses leverage industrial IoT technology to optimize warehouse workflows, improve inventory management, and enhance overall efficiency. A key example is the implementation of automated guided vehicles (AGVs), which leverages IIoT technologies like sensors to navigate autonomously and optimize routes. In doing so, AGVs contribute to better decision-making and streamlined workflows

For instance, Amazon Robotics Fulfillment Center uses over 100,000 AVGs to transport products from shelves to packing stations, reducing the time and effort required for order fulfillment. By automating these types of material handling tasks, AGVs help them  revolutionize their traditional workflows, leading to increased productivity and output.


Manufacturing optimizes its operations through the incorporation of sensors and smart devices, utilizing industrial IoT to gather data on machinery performance and environmental conditions. Sensors, for example, collect real-time information and help companies monitor production processes and equipment health. This data is then analyzed to improve decision-making, optimize operations, and predict when maintenance is needed.

Additionally, smart factories integrate advanced sensors and interconnected devices into manufacturing processes. Some examples of smart factory technology include IIoT-enabled production lines, predictive maintenance systems, and automation, which all contribute to enhanced resource efficiency and improved product quality. 

We can look at industrial robots as a key example. Take BMW, an automotive manufacturer who is deploying humanoid robots to perform physically demanding and monotonous tasks at its manufacturing plants. 

Read More: How Cyngn's Stockchaser Enhances Productivity


IIoT enhances production efficiency and streamlines manufacturing processes in the automotive industry. Smart sensors embedded in machinery help monitor equipment performance and predict maintenance needs. Additionally, industrial IoT enables real-time data analysis, allowing automotive manufacturers to optimize supply chain management and ensure quality control throughout the production cycle.

For example, Volkswagon is using sensors to monitor the status of its robots and other equipment on its assembly line. As a result, they are able to make informed decisions and reduce downtime based on these insights.

Oil and Gas

The oil and gas sector utilizes industrial IoT to better connect and monitor equipment in real time. Sensors and devices are deployed across drilling sites and refineries to gather data on equipment performance and environmental conditions. This information is then used to predict potential issues, optimize production, and improve safety.

For instance, Euronav, a leading crude oil tanker company, employs a centralized IoT-based platform called FAST (Fleet Automatic Statistics & Tracking) that captures data from ships for real-time analysis. By leveraging IIoT, they were able to monitor how their ships were performing in real time, allowing for improved decision-making.


IIoT services are used to monitor equipment health, helping utilities predict and prevent equipment failures in the utilities sector. For example, smart grids use IIoT technology to help keep track of energy use in real-time, predict when maintenance is needed, and set flexible prices. This allows consumers to make smart choices about how they use energy. 

Additionally, smart cities can enhance urban infrastructure and services, promoting sustainability and improving quality of life for residents. By leveraging IIoT technologies, like smart grids, cities can enhance transportation systems, energy efficiency, and public safety.

For example, Singapore is the top-rated smart city in the world. As a country, they’ve leveraged industrial IoT technologies such as putting sensors into robotic swans that are strategically placed in water ways to detect water quality.


Industrial IoT revolutionizes traditional farming practices. In fact, around 10-15% of US farmers already use IoT and self-driving tech on 250,000 farms. Agriculture companies are increasingly integrating smart devices and sensors to optimize various aspects of crop management. These sensors can collect data on soil moisture, temperature, and crop health. For instance, Cowlar, a developer of smart devices specifically for the dairy industry, uses smart tags on cows to monitor their temperature, health, activity, and diet.

In addition, crop monitoring systems help farmers observe crop growth, detect diseases, and predict yields remotely. By merging data from satellites, drones, and ground sensors, farmers can manage large farms more efficiently.

Importance of the Industrial Internet of Things

Benefits of IIoT

1. Safety and Security

The National Safety Council (NSC) has proven that the industrial landscape is prone to workplace injury more so than any other industry. For example, manufacturing saw around 490,000 medically-consulted injuries in just 2022 alone. As a result, workplace injury remains a top concern within the industrial workforce.

Luckily, IIoT enhances both safety and security by providing real-time monitoring of equipment and processes in order to avoid these types of injuries and safety risks to both assets and workers. Other Industrial IoT, such as automation, can perform hazardous tasks without direct human involvement, which also significantly boosts workplace safety.

By implementing IIoT, organizations can better detect potential hazards, such as equipment malfunctions or safety breaches, leading to a safer work environment. 

Learn more about Cyngn's focus on safety and our technology stack that minimizes workplace incidents.

2. Improved Workflows

Industrial IoT contributes to improved workflows by facilitating real-time data exchange between interconnected devices. Leveraging technology, such as automation, can also significantly improve workplace productivity by automating mundane, repetitive tasks. With IIoT, organizations can gain valuable insights into operational patterns, identify bottlenecks, and optimize workflows for enhanced efficiency. 

Read More: Our Autonomous Vehicle Workflows

3. Consistent Operations

Industrial IoT ensures consistent operations by providing real-time data and insights that allows organizations to proactively monitor their processes. This continuous monitoring and data-driven decision-making lead to the production of higher-quality products, ultimately leading to increased customer satisfaction.

4. Efficient Labor

Leveraging IIoT devices leads to ease labor challenges by automating repetitive tasks, allowing human workers to focus on more complex and value-added activities. Real-time data from IIoT sensors further offer real-time insights into daily operations, leading to increased productivity and streamlined operations.

A study by the MPI Group reveals that factories incorporating IoT solutions have experienced a 72% increase in productivity. This showcases how IIoT technology can lead to a more agile workforce capable of responding to dynamic market demands. 

5. Data-Driven Decision-Making

Lastly, Industrial IoT enables data-driven decision making by collecting real-time information from connected devices and systems. This data provides valuable insights into operations, allowing businesses to make informed choices quickly. By analyzing this data, organizations can optimize processes, improve accuracy, and increase productivity.

Potential Risks of IIoT

1. Malfunction

Malfunctions in IIoT systems pose significant risks to industrial operations, potentially leading to costly downtime and disruptions. These malfunctions can stem from hardware failures, software glitches, or communication errors within the IIoT ecosystem. As a result, it’s important that organizations implement robust contingency plans to mitigate these impacts and ensure the resilience of their IIoT infrastructure.

2. Cybersecurity Attacks

Industrial sectors, especially manufacturing, are prime targets for cyber attacks, constituting 24.8% of all industry attacks since 2022 according to Statista. Cybersecurity threats to IIoT networks and devices can jeopardize data integrity, operations, and reputation. As a result, this remains a top concern for organizations that are implementing industrial IoT into their workflows.

Therefore organizations must employ robust full-stack protection and messaging protocols into their IIoT integration. Encryption, authentication, and intrusion detection are just a few ways organizations can safeguard their IIoT environments. Protecting every aspect of the IIoT system is crucial to thwart threats such as malware, ransomware, and denial-of-service attacks.

3. System Migration

Transitioning existing systems to IIoT infrastructure requires careful planning, testing, and execution to blend in smoothly and avoid disrupting operations. Organizations must address security concerns and possible downtime during the migration to mitigate risks and ensure a successful switch to IIoT-powered operations.

Layers of IIoT Architecture

The layers of IIoT architecture provide a structured framework for organizing and managing the components of IIoT systems. 

1. Perception Layer

The perception layer forms the foundation and involves sensors and actuators that are responsible for gathering and processing real-world data from the physical environment to the network. 

2. Network Layer

In the network layer, information from sensors travel seamlessly between devices and systems. This allows information to move around reliably, making it possible for devices to share data and work together efficiently.

3. Processing Layer 

In the processing layer, gathered data from the networking layer is processed through computers to make sense of information collected by sensors. This layer is critical for extracting actionable insights from raw data, enabling real-time decision-making and automation in industrial environments. 

4. Application Layer

The application layer is where the analyzed data is put into action and used to execute specific tasks or applications. This may include adjusting machinery settings, predicting maintenance needs, or optimizing production schedules, helping organizations automate tasks and make smarter decisions.

Implement IIoT at Your Business with Cyngn

Organizations can implement IIoT by investing in industrial robots to enhance automation, connectivity, and data collection in their operations. Additionally, Cyngn's fleet of industrial AVs, equipped with sensors and communication technology, can autonomously navigate and interact with the given industrial environment. This allows organizations to improve safety, reduce downtime, and enhance overall productivity. 

Additionally, our technology helps organizations aggregate data about vehicles to extract business insights through tracking key metrics such as battery life, location, and cycle time. This data helps organizations respond to potential issues down the line and pivot operations when needed. 

Frequently Asked Questions

What's the difference between IoT and IIoT?

The main difference lies in their application. While IoT focuses on consumer-oriented applications like smart homes and wearables, IIoT targets industrial settings, optimizing processes and enhancing efficiency in manufacturing, logistics, and utilities.

What is IIoT architecture?

IIoT architecture comprises several layers: perception, network, processing, and application layers. These layers work together to facilitate data collection, transmission, processing, and application within industrial environments.

What is the industrial internet of things (IIoT)?

The Industrial Internet of Things (IIoT) means linking sensors, devices, and machines in industries to collect and analyze data to automate tasks. IIoT helps industries work better, making processes more efficient and sparking new ideas in manufacturing, energy, and transportation.

What is an example of IIoT?

An example of IIoT is the use of automated guided vehicles (AGVs) in warehouses. These vehicles are equipped with sensors and connected to the industrial network, enabling them to navigate autonomously, transport goods, and communicate with other systems. By integrating AGVs into warehouse operations, organizations can streamline material handling processes, optimize inventory management, and improve operational efficiency.

What is the goal of IIoT?

IIoT aims to use connected devices, sensors, and data analysis to make industrial processes better, faster, and more innovative. Organizations want to use IIoT to get instant updates on how their equipment is doing, predict when maintenance is needed, and make decisions based on data.

What does industry 4.0 focus on?

Industry 4.0 wants to change how manufacturing and other industries work by predicting when machines need fixing, customizing products on a large scale, and spreading out decision-making. The goal is to make industries more efficient, flexible, and creative, moving towards a smarter way of making things where everything is connected.

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