The Internet of Things (IoT) means more than simply connecting devices and systems. It is creating opportunities for new products and services not previously thought possible.
Once positioned as a niche technology for startups, IoT today is a go-to technology for enterprises which desire to transform their future business. The global IoT market is predicted to be $1.7 trillion at the end of 2019 and to further generate $4-11 trillion by the year 2025. We look at 6 ways businesses benefit from IoT.
Data is the new gold, turning into the most effective weapon of different industries. Sensors are so cost-effective that they can be attached to almost everything nowadays. Sensors in production systems, assembly lines, warehouses and vehicles produce data that help managers understand their operations, and monitor and improve product performance.
Today, a business knows where your shipment is, what temperature the mode of transportation is, and when it reaches the shelf. New ventures or business expansion include preventive maintenance, automatic product upgrades or updates, and the tracking and tracing of assets. By 2020, it is predicted that there will be 22 times more data traffic, where almost 40% of all data produced will come from connected sensors. All this data will greatly add value in making informed business decisions.
Understanding customer preferences and behaviour is key to the success of any business. Businesses can collect, monitor and analyse data from video surveillance, social media, mobile and internet usage with IoT. Customer preferences and trends allow businesses to design products and offer personalised services for better engagement. E.g. on-floor cameras tied to AI or analytic systems allow retailers to better understand and anticipate customer reactions to sales floor promotions.
In enhancing customer experience, 56% of the companies in Forbes Insights survey are investing in IoT to build on the customer experience, and 42% have expanded their capabilities in terms of personalized customer experience as a result of IoT. With IoT data, companies can respond quickly to issues and requests. Some airports employ IoT sensors, e.g. cameras, where problems such as broken escalators, security line backups, dirty washrooms and bottlenecks within corridors can be analysed and addressed. Airports then respond by dispatching maintenance teams or opening gates, depending on flight arrivals and foot traffic. Other examples include the use of hyper-local advertising/couponing to enhance the customers’ experience and meet their target requirements.
IoT opens the door to new business opportunities and revenue streams and many business leaders believe that IoT will have a major impact in the next few years. It is expected that almost $41 trillion of funding may be poured into IoT over the next 20 years for infrastructural upgrades. Companies now not only manufacture products but also offer ongoing services to monitor the performance of these products.
The data from IoT devices can also be shared across an organization’s ecosystem of partners and customers, providing new paths to innovation in the form of new value-added services and continuous engagement.
IoT devices can help ensure workforce safety and improve workplace security. Using embedded wearables and sensors, employees in high-risk settings like heavy industries, mining, and construction can be constantly tracked and alerted against dangers, falls or exhaustion. IoT integrated with sensors and cameras help monitor equipment safety, breach or attack on the system and protect against physical threats. Its connectivity and capability of providing real-time insights will help coordinate multiple teams to resolve issues promptly.
IoT offers efficiency and productivity at various levels for businesses and boosting profitability. For example, providing just-in-time training and troubleshooting for employees, improving labour efficiency, and reducing mismatch of skills.
Businesses are smarter with real-time operational insights where data collected from the logistics network, factory floor, and supply chain will help reduce inventory, time to market and downtime due to maintenance. IoT will improve tracking of assets (equipment, machinery, tools, etc.) using sensors and connectivity, more easily locating issues and running preventive maintenance to improve asset utilisation.
IoT also allows machines and processes to be automated. Factories with IoT-enabled equipment can work around the clock, producing more. As humans are not as involved in the production, there will be fewer errors. IoT can even enable and automate small day-to-day routine tasks like setting-up tea or coffee makers on timers to increase office productivity. Instead of spending time on repetitive, low-value tasks, people can focus on adding value to businesses.
Businesses reduce cost via improved asset utilisation, productivity, and process efficiencies, through predictive analytics and real-time diagnostics. As IoT takes over, maintenance cost is expected to come down by more than 25% and downtime will be reduced by 35%. In manufacturing industries, IoT devices are used to monitor equipment and reduce downtime by predicting probable failures or errors on the production line. Businesses can even save on energy costs and improve electrical efficiency by using IoT and smart building systems to monitor and control redundant usage of electrical systems.
In conclusion, IoT is a compelling value proposition and a major driver of transformation for enterprises because it brings together data and intelligence to deliver new ideas and ways of doing business. We look at how we can be IoT-ready in our next article.