Internet of Things ("IoT") is currently a buzz word and a hype that has been building for years, but not everyone understands it and how it impacts the way we work and live.
IoT is about embedding sensors into all kinds of devices to optimize systems, businesses, and quality of life through data. It collects data from devices; enabling insights and information that are comprehensive, accurate and timely. It is this ability which makes the devices smart. Examples of IoT devices include cars, kitchen appliances, and even heart monitors.
The implementation of IoT is also taking place in a large scale such as smart cities. Smart cities use technology to better population's living experiences, operating as one big data-driven ecosystem.
Statistics forecasts show that we cannot ignore IoT as its influence is growing. IHS Markit, a London based global information provider, expects the number of connected IoT devices to reach 125 billion by 2030. Global data transmissions are expected to grow by 20% to 25% annually to 50%, on average, over the next 15 years.
So is the adoption of IoT dangerous? Yes it is tricky due to security issues but we will leave the discussion to another time.
1) IoT sensors are becoming cheaper and better
Previously, high cost of sensors inhibited IoT growth. However, with more IoT sensor vendors entering the market, the cost of sensors is reducing. Sensors are also continuing to perform better, with longer ranges and lower energy demands, and are also shrinking in size.
Battery-less sensors are currently being explored. It will increase the reach of IoT, as it allows maintenance-free sensors to be deployed far into secluded areas. With lower cost and better performance, sensors can be installed everywhere which is especially useful.
In supply chain, IoT enables better security, transparency and traceability. The placement of small inexpensive sensors can allow you to easily track inventory items, monitor status and position and create a smart warehouse system.
In the food industry, IoT can keep food safer by helping companies measure temperature and humidity in cold storage facilities. In retail stores, items can have an RFID tag to make smart store possible. The reducing cost of sensors allows it to be embedded everywhere to create IoT devices.
2) IoT allows companies to be more agile
IoT opens up access to more data which allows companies to make sense of the data to identify opportunities.
In the area of product development, development teams are translating streams of real time machine data. IoT sensors on products allow companies to read market acceptance and applicability much more precisely when launching new products.
An example is Whirlpool and its smart home appliances (washing machines, dishwashers and ovens). The connected/ smart devices enables Whirlpool to continuously monitor and improve products even after they’ve been sold. Sensors continuously collect data and with consent, send it to the cloud for Whirlpool to analyse. The data shows exactly how customers are using their machines, and how the machines themselves are responding. This makes it easier to tailor-make future designs to customers’ requirements.
Increasingly, companies are using IoT to manage data and change business models. With data, IoT will change the basis for competition and drive new business models for users and supplier companies. For example, machine supplier can use sensors to tell how much time the machinery is used at the customer’s factory and charge the customer for use of the machine by the hour. This will transform businesses to become service businesses.
However, companies also need to consider interoperability which is critical for IoT success. Without interoperability, IoT creates data silos, which will not help in achieving the overall goals of IoT. A true IoT is a single entity comprised of multiple sub-systems.
IoT devices must be able to communicate with each other regardless of manufacturer and technical specification. Industry and standardization bodies should continue developing and implementing guiding standards to facilitate interoperability between IoT devices.
There is also better support for companies to collect data from sensors and devices and make sense of the data. Cloud services and network are improving to collate, manage and analyze data from IoT endpoints. Artificial intelligence and machine learning are becoming common for advanced data analysis.
No matter which industry your company is operating in, you need to think how to monetise data generated from IoT. It is possible to sell data generated from IoT subject to privacy laws. You need to have a good sense of its abilities and strategies of implementation. The complexity of data ecosystem may require the collaboration with experts in data analytics to follow and implement the new trends and business models.
3) IoT allows automation and better decision making
IoT collects data from sensor endpoints, which is increasingly fed into models. The data is analysed to recognise regular patterns and remove anomalies. From the patterns, models can then be developed to perform prescriptive analytics which make devices and systems at the edge of the IoT network more efficient.
They can provide assistance not just with making predictions about what will happen, but also with determining which factors and parameters should be changed in order to get closer to the desired outcome.
Continuously evolving models produce increasingly positive results, reducing the need for human interaction. These evolved models can be used to automatically produce reliable and repeatable decisions. Rules engines would be embedded at end points, which would allow individual nodes to take action.
Companies can gather information, convert that information into insights and then take action in real time. For example, the remote patient management system used with connected pacemakers showed a 33% relative reduction in the risk of death in patients who were remotely monitored compared to patients who were not.
IoT can also simplify preventive maintenance in manufacturing. Traditionally, preventive maintenance is synonymous with scheduled maintenance. IoT technology allows for real-time, remote condition monitoring to dictate maintenance. This reduces cost of machine failures. The failure of a single piece of machinery can bring an entire assembly line to a grinding halt.
The time has come for organizations to think more boldly about IoT’s possibilities and about the strategies that can help realize IoT’s full disruptive potential. Capturing the IoT opportunity will require an understanding of where real value can be created and a successful effort to address a set of systems issues, including inter-operability.
IoT promises to drive tremendous innovation and economic growth. You need to reboot the way of thinking and embrace these changes for a more robust future. It must be remembered that IoT is a business opportunity, not just a technology opportunity. Managing data generated from IoT devices is critical.
If you require assistance to understand the strategic context and full economic picture on embarking on an IoT journey, contact us. Let us know which area of IoT impacts your company most by leaving a comment. Subscribe to our newsletter for regular feeds.
If you like to read more about how big data analytics improve efficiency, read our previous post: https://www.letolleconsulting.com/post/3-reasons-companies-need-big-data-analytics-to-improve-efficiency
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References
IBM, IBM and Whirlpool: An Innovative Partnership, https://www.ibm.com/blogs/internet-of-things/whirlpool/, published 31 August 2016
IHS Markit, The Internet of Things: a movement, not a market, https://cdn.ihs.com/www/pdf/IoT_ebook.pdf
Pandora FMS, https://blog.pandorafms.org/interoperability-in-iot/, published 11 May 2018
World Economic Forum, You Can't Afford to Ignore the Internet of Things, https://www.weforum.org/agenda/2014/09/internet-of-things-will-change-everything/, published 1 September 2014