Cloud computing was defined by Ezell & Watson as "the provision of infinitely scalable computing resources as a service of the Internet" (2017). Today, technologies such as artificial intelligence, machine learning and the Internet of Things (IoT) are becoming increasingly important for businesses of all kinds - including modern manufacturing. In fact, cloud computing is transforming virtually every aspect of modern manufacturing.

The opportunities of cloud-based technologies

Whether it's operations, integrated supply chains or the design and manufacture of products, cloud-based technologies can be used in many areas of the manufacturing business. One of the most important reasons for companies to adopt cloud-based technologies is cost savings. With the cloud, companies no longer need to invest in expensive hardware. Instead, they can choose from a variety of cloud-based applications based on the latest research and technology.

The choice between a custom (or open source) platform and a serverless platform provided by cloud giants (Amazon, Microsoft, IBM or Google) depends heavily on the customer. Сloud providers have pricing models based on the number of messages sent and received through the service. Compared to the cost of setting up and maintaining an on-premise system, cloud systems are almost always cheaper. However, price is not the only factor to consider.

An important aspect is flexibility and scalability. Modern manufacturing companies are faced with high consumer expectations and increased competition. Product cycles are getting shorter and shorter, increasing the pressure to accelerate the pace of innovation and operations. In this fast-paced world, the ability to adapt quickly is critical. Cloud-based applications offer manufacturing companies the flexibility they need and allow them to customize applications to their specific needs.

Cloud-based technologies also enable companies to improve efficiency and reduce time-consuming processes. Intelligent systems can create transparent information channels that enable an efficient and flexible flow of resources within the company. Intelligent tracking solutions that monitor the flow of these resources can be used to implement automation processes thanks to cloud-based, integrated data analysis tools. These systems track the flow of goods and analyze the efficiency of the system - in real time. To take things to the next level, intelligent systems can find patterns in historical data to draw conclusions about specific outcomes (predictive analytics). This can be used to repair or maintain machines and prevent breakdowns in the production cycle.

Short outages with major damage

For large manufacturers, even minor outages can bring operations to a standstill, resulting in lost revenue that can quickly add up to hundreds of thousands of dollars per hour. Considering the cost of system downtime, it is unacceptable to interrupt operations to perform preventative maintenance that is not necessary or wait before making repairs. Based on real-time sensor data, historical data, weather data, inspection results and maintenance reports, machine learning models are able to predict the failure of any component with a high degree of accuracy. This solution can be scaled from a single plant to more than 1,000 units.

Another benefit of implementing cloud-based technology in a manufacturing organization is the disaster recovery and failover capabilities that are standard offerings from cloud platform providers. A single natural disaster can significantly impact a company's ability to maintain operations. The same is true for a localized emergency, such as a fire or water damage in the factory. Thanks to cloud computing technologies, systems can remain secure and accessible from anywhere and at any time. Cloud computing also shifts much of the responsibility from management into the hands of experts whose business and reputation rests on their ability to perform IT functions thoroughly and efficiently. This in turn allows management to focus on their core tasks and frees up internal resources.

In addition to the many benefits that cloud-based technologies offer for modern manufacturing, there are also a few risks that need to be carefully weighed up.

Risks and concerns

Core functions and functionality come first and are the most important aspect when selecting a cloud-based application or service.

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The first and most common risk associated with cloud-based technologies is data loss, also known as data leakage. Data loss is the process by which data is deleted, corrupted or made unreadable by a user, software or application. Similarly, a data breach occurs when confidential data is viewed, accessed or stolen by a third party without authorization. So-called vendor lock-ins occur when companies have a problem with data transfer between providers. As vendors provide different platforms, this is one of the most common security issues with cloud-based technologies.

Cloud-based technologies rely on the internet, so hacking is another common security issue. A common case of hacking is account hijacking, where an individual's or company's cloud account is stolen by hackers and used for unauthorized activities. Vulnerabilities in a company's local infrastructure can also open up opportunities for unauthorized access to cloud data. You don't have to download anything to do this - most computers store passwords, personal information and business documents in the storage area of other running programs.

The risks and concerns of implementing cloud-based technologies are obvious. When it comes to production-related systems and processes, there are good reasons to keep some of your IT services in-house or in a private cloud.

Cloud giants such as Microsoft Azure, Amazon Web Services (AWS) and Google Cloud Platform (GCP) follow a shared responsibility model that determines which security tasks are the responsibility of the cloud provider and which are the responsibility of the customer. Audits of customized solutions are complicated, and due to this complexity, security on these platforms is never fully guaranteed. Security audits are therefore much easier and less costly if some of the security-related functions are covered by a cloud provider, which can be confirmed by searching for the provider's relevant certificates.

DataArt Security Center Manager, Dmitry Vyrostkov, recommends that developers working on a project use integrated cloud or external console tools that can examine the solution and ensure it is configured correctly - much like an audit team. Amazon, for example, offers AWS CloudWatch for analyzing logs, alerting and collecting metrics. MS Azure and Google Cloud have their own security and monitoring tools.

Cloud-based products and apps

Companies tend to implement cloud computing in one of three main formats: Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS) or Infrastructure-as-a-Service (IaaS).

SaaS allows users to access software applications over the Internet using personal computers, mobile devices or instrumented machines instead of having to store software locally on company-owned devices. Infrastructure-as-a-Service provides organizations with access to a secure, enterprise-grade computing infrastructure that can be managed and scaled to meet processing and storage needs. With Platform-as-a-Service products, users can rent virtual software development or production environments to develop and deploy new applications without having to invest in expensive hardware or software licenses themselves.

The question should be at the forefront of any cloud strategy: What is the overall IT structure/strategy and how can it be improved by accessing cloud-based solutions? Based on the answer to this question, there are a few things to keep in mind when selecting a cloud-based service.

Core features and functionality come first and are the most important aspect when choosing a cloud-based application or service. To maximize the integration of cloud-based technology, it should meet specific business needs. There is no one size fits all, which means that both customizability and the presence of relevant core functionality are critical. The next point is scalability. The ideal system is flexible and can grow with the business. In a consumer-oriented industry such as manufacturing, a product that can act and react is essential. As mentioned earlier, security is the biggest issue with cloud-based technologies. It is important to choose a reputable provider to ensure that security requirements are met. And finally, the system should be intuitive and easy to use. The goal is to streamline processes and facilitate collaboration.

Existing providers have an extensive product offering, but companies should ask themselves whether they can and want to cover their specific needs completely with a single provider. In many cases, it makes sense to consider a multi-cloud strategy for IaaS-related services in addition to using different SaaS solutions.