The internet has become an integral part of most people’s lives and we’re all familiar with accessing information, streaming video and sending and receiving emails but many people haven’t yet investigated the power of the Internet of Things (IoT).
For businesses, the IoT brings a whole new dimension to the way that their business model operates and internet connectivity, using the data that is gained, can supercharge the services they offer their customers.
This article, inspired by our recent event Innovation Driving Growth, looks at why a company might want to connect their devices and machinery to the internet, what benefits could accrue and how you can get started with IoT.
The internet of things is a web of devices and sensors that are all connected using the internet.
You may already connect things like wireless printers and TVs to your laptop or mobile device and the Internet of Things works in a very similar way.
For example, the TV that connects seamlessly to your phone so that you can show a video on a larger screen can also connect back to the manufacturer to send service information.
The IoT is founded on a network of sensors; devices that can measure the status of their environment and provide information over a secure connection.
So a sensor may be designed to report temperature, sound, vibration or a change in status of the thing that it is attached to.
Cars have had sensors in place for years. Typically they will have been used to measure the depth of brake pads and show a warning light on your dashboard when they need replacing.
What makes the IoT so exciting is that now manufacturers can connect the sensor to the web and report that information back to base or even to an app on the customer’s phone.
But the IoT isn’t confined to hardware devices. Sensors can be used to track cattle movements, monitor heart implants or tell you where your cat has gone!
For many years the Internet of Things seemed like a mere theoretical exercise but developments in the technology now mean that every business needs to be aware of the power of the IoT.
You may not think you have come across IoT enabled devices but if you have bought a smart TV recently, wear a smartwatch or use a TV recorder then you have an IoT enabled device.
We were given a very interesting example of the practical use of IoT by BCP council from Sarah Levett of IoT Solutions during our event.
BCP had a problem with rubbish coming out of overfilled bins on the seafront. Traditional collection routes weren’t responsive when there was an overfilled bin as the refuse lorry simply turned up at preplanned times.
A fairly mundane problem to be sure and not one that would immediately scream “IoT” but IoT solutions came up with sensors that would tell the council when bins were full, meaning that they could alter their routes to only visit areas of high demand saving the council money and improving the seafront for visitors.
As Sarah noted, “we were able to calculate that if we implemented that across the council area we’d make savings of around 52% whilst at the same time no bins would be overflowing.”.
So if a council can make such dramatic savings from a daily old-world problem, it stands to reason that there could be even greater benefits for businesses.
When Reid Steel looked at developing a new processing plant, systems and processes were at the forefront of their minds. As Director Simon Boyd told us at Innovation Driving Growth their steel making process had been totally transformed by the use of data and “looking at our calculations, just by changing the way we do this it is going to improve our productivity by 100% on day one, by year five it will be a 300% increase in productivity.”
IoT applications are now being found in all areas of society from washing machines and fridges that report their status back to the manufacturer to stockrooms that can manage their own levels and production lines that can report on the precise location of any given part and with productivity gains like these, you can understand why.
For a business that wants to introduce IoT devices into its portfolio, there are a number of benefits.
Typically IoT systems can be used to;
So the benefits can be financial by reducing costs and increasing sales or qualitative in terms of improving customer service.
In fact, the application of IoT to business systems is really only limited by your imagination.
The major benefit of the IoT for companies isn’t really in the sensors and connectivity itself. After all, the sensors are simply dumb measuring devices of one sort or another. The power of the IoT comes from the data that the sensors pass back to the business.
Essentially when a company starts to collect information in this way it is creating ‘data assets’ that can be used to improve customer service, reduce costs or increase sales.
A fairly nebulous term, a ‘data asset’ is simply a collection of data that can be used to understand more about the way that customers interact with a service or how devices and machinery are operating.
A company that can use these data assets effectively will have a major advantage over its competitors who continue to work in the old ways.
By using simple analysis techniques, managers can work out the best utilisation of their workforce, the likely future serviceability of their plant or the best way to anticipate the needs of its customers.
Allying this with automation, the data gathered by IoT enabled devices can be used to reduce costs and increase profitability whilst improving your customer satisfaction.
The starting point for any business that wants to adopt IoT is to look at processes that require simple decision making and rely upon standardised information.
As panel member David Ffoulkes-Jones of Daizy explains; “It is literally going through your key processes, understanding what’s costing you time and money and potentially harming customer satisfaction and then prioritising it from that point.”
Don’t look to do everything all at once, instead choose one specific area to implement IoT as something of a test.
Think about the blind spots you have in your business. What could you do if you had more information about that area?
Then plan out how you would use the information if you had it. What changes would you make? How would it alter your business model? What value would it add?
Then it’s a matter of speaking with an industry professional about how you can use the IoT to gather that information.
And there’s some good news here; anecdotal evidence suggests that when businesses set up an IoT based service they not only find new ways to use the data that they hadn’t thought of but they also find other things that can be connected up.
So a single test project is most likely to end up producing more benefits than you originally expected and it is also likely to trigger thought processes that result in new ways to use the IoT.
So we can see that there are a large number of potential benefits for any type of business that wants to invest in IoT.
It can revitalise your business model, making it more profitable and reducing costs but there is a fly in the ointment.
If you could become IoT enabled then it follows that your competitors could too and that could spell trouble. Ask yourself how difficult it would be to compete with a company that had reduced its cost base by 50% and you’ll see why.
So our advice is to start working on this now and start to realise the real benefits that IoT could bring to your business.
