Everyone seems to be talking about the Internet of Things (IoT) and how it is the next big thing. And how it will transform our lives by making everything ‘smart’. Undoubtedly, when 25 billion connected things are predicted by 2020, with $1.7 trillion market value, IoT is deemed be the next big thing (Source: Gartner and IDC reports). These talking points and statistics can be good for chatter or for a casual coffee table conversation but when it comes to board room discussions and decisions, these are not enough.
Decision makers need to look beyond the hype and statistics. Since 70% of value from IoT will come from B2B scenarios, IoT becomes critical from an industrial point of view. Thanks to the digital era, many major corporations, across different industries, know what IoT is and few have already started their journey and made investments in “Industrial” IoT.
According to Gartner, Internet of Things is the network of physical objects that contain embedded technology to communicate and sense or interact with their internal states or the external environment.
IoT- Redefining Business
The digital disruption has created awareness among the C-suite about how technology can change the way businesses, function and operate. Mobility and cloud solutions are, now, becoming main-stream and key stakeholders are looking at other technology areas, apart from these. With this background, the C-suite understand that IoT is all about connecting your assets with sensors to get data from them. However, their questions on IoT are a lot different; they want to understand what IoT can do, specifically, to their business. Some common questions from decision makers are:
- The current operations are functional with mobile and cloud solutions. How will connecting sensors and getting data add value?
- Is it wise to use a sledgehammer to crack a nut? Do I really need so much of data to solve an unseen issue?
- How will this much quantum and velocity of data, change the way my business operates?
- How will the current infrastructure be able to support this influx?
- Will it become like a wild goose chase trying to capitalize on IoT? What will be the ROI for this entire initiative?
All these questions are valid and are absolutely relevant about IoT, which is still in a very nascent stage. But the one undeniable aspect about IoT, that justifies the buzz, the hype and the euphoria, is its capability to move the organization from being reactive to proactive. At first, a statement like moving from reactive to proactive can sound generic and superficial but what it, inherently, means is making the organization:
a) Operational Technology (OT) connected with Information Technology (IT).
b) Connected with People, process, tools and assets.
a) Automated in the true sense of eliminating silos, eliminating spaghetti integration and eliminating manual interventions for everyday tasks thereby, eliminating room for errors and time lag.
b) Making effective use of the much valuable time and putting efforts by making people work with the data rather than working for the data.
a) With proper connectivity, organizations can have close to nil time delays to see what is happening on the ground.
b) Decisions from top to bottom can be instantaneous.
Unlocking Value from IoT
Being connected, automated and real-time is possible with IoT, which brings in data from assets (movable, non-movable, living or non-living), connects the data with the applications we use and helps us visualize the data to make better decisions. Simply put, IoT is the next big thing on: from where we get data and how we are going to handle that data. To bring that in perspective, if we look at the entire evolution of data sciences over time, IoT is that link in this evolution chain which can transform your enterprise from an integrated, collaborative enterprise to smart and cognitive enterprise. This technology will help us become more intelligent, smart, predictive and cognitive.
Businesses, wanting to unlock value from IoT, should look at it from the use case or data perspective rather than from assets or sensors perspective. Sensors have been present on assets for more than a decade now, so IoT is not about installing new hardware. Similarly, data has always been there with organizations, the challenge was getting meaningful data back to their systems to aid in decision making.
A Closer View
If we look at this with a specific example of cold storage logistics, where there are perishable shipments, a seamless flow of material and information is necessitated. Traditionally, the organizations had integrated enterprise wide data about the shipments, their supply chain network, orders etc. But ensuring the quality of shipments and reducing wastage has always been a challenge. IoT solutions come in the picture for transformation to smart and intelligent cold storage provider.
- Will knowing the real-time shipment temperature, humidity etc. help ensure quality?
- Will knowing the route deviations and fuel usage, in real time, help reduce losses?
- Will predicting a vehicle breakdown help reduce delays by fixing it on time?
- Will automated data collection help save cost by better optimizing route?
IoT enabled solution for cold storage can send real-time alerts when the temperature is going above the threshold limit or when the humidity level is increasing.
IoT enabled fleet tracking, can alert, in case of unauthorized route deviation, abnormal fuel usage or can, also, stop the vehicle in the event of any abuse.
IoT enabled fleet maintenance can bring in the capability to predict a vehicle maintenance requirement or spare part replacement, depending on past trends, current usage and hence, avoid unforeseen delays.
What Lies Ahead?
To summarize, the value of IoT lies more in the insights generated for real-time decision making rather than the “things”. Organizations should think about local process improvements and act on it at a global scale, holistically, with other digital technologies. Together with cloud, mobile and big data tools and technologies, IoT completes the loop and brings in immense value to the organization. They should start targeting processes as even the slightest change can add a lot of efficiency or improve productivity or save cost or increase revenue.
“It is not a problem until there is a solution” – this approach, now, seems to be less popular after the IoT arrived; now is the time to solve your problems.
Sr. Consultant – Digital Business Consulting