Cloud MES: How manufacturing software is migrating to the cloud

In short

Enterprise software, such as ERP, is increasingly moving to the cloud; Cloud adoption for manufacturing software, such as MES/MOM, is much lower but accelerating.
29% of manufacturers in a recent survey indicated a move of MES software to the cloud in the next 2 years.
The Cloud MES market is estimated to reach $2.34 billion by 2026.

Why it matters?

Offering cloud-based MES solutions will provide new business and growth opportunities for manufacturing software vendors.
Widespread adoption of cloud MES will help manufacturers scale operations globally with complete operational visibility and control.


According to the  World Economic Forum , it is estimated that by 2025, 463 exabytes (1 exabyte = 1,000,000 TB) of consumer data will be generated every day globally. Factories are expected to add  22 zettabytes  (1 zettabyte = 1000 exabyte) of data on top of this.  

The challenge is to make use of the data in a meaningful way and use it to create value. However, today, a significant portion ( ~55%, according to Splunk ) of this data is “dark” (i.e., it is not used for any analysis). A major reason why data remains “dark” is because existing tools are not designed to handle the volume and variety of data generated. 

In the last few years, companies seeking to “light up” this dark data have increasingly been adopting a technology that allows data to be captured and analyzed in a significantly more powerful way: The cloud.  

Migration to the cloud

When compared to existing technologies, the cloud is proving to be more efficient and superior by providing a scalable infrastructure where data can be securely collected and accessed from anywhere and on any device. Migration to the cloud has already proven to be a gamechanger in day-to-day usage for several enterprise software categories. Microsoft 365 has become the de-facto cloud-based standard for enterprise productivity software. The 2020 success story of the Zoom video conferencing tool can be largely attributed to its cloud-native framework that allowed the company to quickly scale and manage new customers during the pandemic. 

Our data shows that manufacturing software is following suit. Benefits such as easy scalability, smaller upfront investments and operational costs, fast deployment, and remote accessibility also make the cloud advantageous for factories’ manufacturing software. 

A Q4/2020 survey of 49 manufacturers conducted by IoT Analytics showed that the move of manufacturing software to the cloud is broadening and accelerating. While nearly 50% of today’s PLM and ERP systems and roughly one third of MES/MOM and CMMS solutions are already partially deployed in either a private or public cloud environment, many companies are planning to move more such workloads to the cloud in the next 2 years. 29% of respondents, for...