If you’ve missed the enormous attention around the Internet of Things (IoT), you’ve probably been in temporary hibernation. IoT is with you, it’s with me, with them …. IoT is everywhere, and we’re just getting started. The Internet of Things has the potential to fundamentally shift the way we interact with our surroundings. The fact that IoT can electronically monitor and manage physical objects allows for data-driven decision taking. It will enable systems’ performance optimization, create value with new business models, save people’s time, and increase quality of life.
Think as wide as you can with the above summary. For example, if I mention vehicles, I don’t only focus on the obvious preventive maintenance or navigation areas. Also think about pre-sales analytics. For example, a truck manufacturer can monitor the loading levels on the trucks sold to various fleet owners. Say a fleet uses a truck model with a 16-ton capacity, but daily use never exceeds eight tons per truck. The truck manufacturer can then cross-sell a nine-ton truck to the fleet operator, which can improve fleet fuel efficiency and make the fleet operator a more loyal customer.
Another example in worksites is usage-based design. IoT could provide manufacturers with relevant data to improve research and development. Based on actual usage data, manufacturers can determine what functions should be added, what parts could be improved, and what features can be removed. This can lead to increased sales and higher margins. Additionally, the stream of IoT data can become a business opportunity itself, as jet engine suppliers have shown.
As the infographic shows, research predicts that the biggest settings for economic impact are factories, human, and cities. China is expected to be one of the largest users in the factory setting.
Conclusions from IoT findings
The most important conclusion from today’s IoT findings is that when different IoT applications start communicating with each other, their economic impact is exponentially multiplied. When vertical industry IoT applications are made interoperable, they’ll create a way bigger value than when they’re left isolated.
On average, 40% of the total economic impact of IoT in 2025 can be assigned to interoperability. As a specific setting, worksite has 60% of its economic impact driven by interoperability.
A second important conclusion is that most of the IoT data collected is either not used today, or, if it is used, it isn’t leveraged to its full extent.
Two opportunities of IoT applications
The two big types of opportunities driven by IoT applications are 1) transformation of business processes, and 2) new business models driven by interoperability. In my next blog, I’ll detail these opportunities further, and discuss how predictive analytics affects the success of interoperable IoT.