The Internet of Things (IoT) has the potential to transform the way we work and live, saving money, time and resources. We’re about to see an explosion in growth as companies finally begin to deliver on its promises. Here’s what you can expect from IoT in 2018.
The convergence of the digital and physical worlds enabled by IoT is already being embraced by businesses making use of the 16 billion connected devices. By 2025, Cisco estimates there will over 80 billion IoT endpoints. That’s more than ten for each person on the planet.
The Internet of Things (IoT) bridges the physical and digital worlds, bringing them closer together. In 2018, Forrester claims there will be a shift from ‘experiment to business scale’ as businesses begin to harness the power of IoT at scale.
According to GE research, cost savings are the biggest driver for 69% of European businesses forging ahead with IoT. IoT isn’t simply about introducing new technology. It’s a process that involves using data and insight captured from the billions of connections to drive business change.
What can IoT do?
“At the center of everything we do is a product or a thing. You are either making that thing or you're connecting it.” Says Richard Spencer, Isentia’s CMO. IoT can be used to help businesses reduce manufacturing and operating costs, saving money through process. But it can do much more, Spencer says, offering businesses the “opportunity for true business transformation.”
Process reengineering using IoT can help businesses move ahead. Smarter, leaner and faster manufacturing has seen 82% of businesses who use IoT experience efficiencies, 49% having fewer product defects and 45% seeing increased customer satisfaction.
Rolls Royce collects data from 25 sensors embedded in its massive Trent engines to help it predict potential failures before they happen. In a business where margins are tight and downtime can destroy profits, the organisations Engine Health Management (EHM) team is using IoT to proactively change their business model.
A huge amount of data captured by Microsoft’s Azure IoT suite can be used to improve the relationship Rolls Royce has with its customers. They’re strategically deploying IoT to gain a competitive advantage by delivering value.
The insights gained from detailed operational information can be used to help airlines operate more efficiently, reducing their fuel costs and carbon footprint.
Stepping into the digital future
We’ve seen modest pace of adoption for IoT but things are about to speed up dramatically. In 2018, we will start to see intelligent IoT products and solutions across all business verticals as business step into the digital future.
Businesses will increasingly use IoT to improve processes and procedures, saving time, money and resources. Centralised monitoring and predictive maintenance of manufacturing equipment can reduce downtime for manufacturers like Airbus, working across their European production facilities.
Travel & Hospitality
A cheap and simple RFID tag in a pallet is all that’s necessary for DHL to track its progress through its global distribution network. Increased efficiency helps to save costs, with real-time data shared with customers increasing satisfaction.
Real-time monitoring through IoT technology can be used to help diabetes patients adhere to medical treatment regimes. Notifications can be used to keep patients, their families and carers informed and aware of what has been taken and when.
Retail and consumer goods
Wal-Mart throws away US$40 million worth of food every year. IoT technology is helping the food giant to reduce waste. A cheap sensor on a freezer door that can alert a member of staff if it’s left open can save hundreds of dollars in lost produce. Across their entire retail estate it can save millions.
The march of progress isn’t always inexorable; there are barriers to over-come. The biggest concern businesses and customers have with IoT is often security. Every endpoint is a potential access point to hackers. As interconnectivity increases, so does the potential impact of a hack. It’s not just business that are worried - 66% of those interviewed in a UK survey expressing high levels of concern about the security of their connected devices.
The Internet of things Security Foundation has suggested a series of principles for IoT security. Adoption isn’t mandatory, but as IoT develops at pace the systems, procedures and processes will need to become standardised. It’s likely we’ll see a greater push in 2018 for an IoT standard, and with it a greater focus on the security challenges posed by the billions of connected devices coming IoT.
Closer collaboration to solve security issues could help tackle a perennial problem that affects new tech: interoperability. Management consultants McKinsey estimate that 60% of the value that IoT systems may create could be locked by a lack of interoperability. In 2018 we’re likely to see the coalescence around platforms and the emergence of universal standards that can help to accelerate the adoption of IoT, and ensure that this value is captured.
Blueprint for change
The potential for IoT is incredible, but new implementations aren’t always successful. In fact, research has found that 60% of deployments don’t even make it off the drawing board.
2018 is the year that organisations need to start considering the full potential of IoT for products and processes, thinking more strategically about how it could impact and improve the way they do business.
The decision for businesses in 2018 isn’t about whether to start exploring IoT. “Either you are all in or your competition is going to eat your lunch” Spencer says. “It's going to be everywhere.”
Richard Spencer, CMO, Isentia