What to expect from the Internet of Things in 2015 Premium
The Internet of Things didn’t revolutionize our lives after all in 2014. Is IoT just a fad that is running out of steam? Far from it: a real groundswell is developing, say the IT experts, who simply believe that neither the markets nor the technology were ready for it yet. So, 2015 should be the year that sees connected objects take off. Here’s an extract from the latest Business Digest dossier.
The Internet of Things (IoT) is a form of technology that enables real devices (and not just computers, tablets and smartphones) to communicate with each other autonomously.
Three areas where IoT can be employed to enhance enterprise performance:
1. Financial performance. Investment in IoT has so far focused on optimizing the ROI of fixed assets. For example, asset-intensive businesses have used the capability of IoT to shorten the lead-time between equipment breakdown and repair, thereby increasing its utilization. But scant attention has been paid to how connected devices can help to identify unmet customer needs, and thus offer products or services that are radically new.
2. Process optimization. Three processes drive the operating performance of a company: customer life cycle, product life cycle, and facility life cycle. Investment in IoT currently focuses mainly on using sensors to monitor facility conditions in order to extend their life cycle. But customer life cycles (When do they adopt and then abandon a product?) and product life cycles (How is a product actually used?) are still unexplored by IoT pioneers.
3. Business model innovation. Why not harness the potential of IoT to disrupt entire markets and industries? It could revolutionize business models by, for example, opening up new revenue streams after the initial sale of a product or service (subscriptions and apps can easily exceed the actual purchase price).
The case of Daimler Trucks North America
Daimler Trucks North America has been fitting connected sensors to its truck engines since 2013. Called the Virtual Technician, the device helps drivers to tackle mechanical problems more seamlessly when they are on the road. The sensors record data continuously and send it to the Customer Support Center in Detroit, which then offers recommendations. If a serious failure occurs, the center notifies the driver that he or she needs to stop, and tells them where the nearest garage is, as well as letting the service station know what parts they’ll need to make the repairs. And the result is that vehicles equipped with Virtual Technician have more uptime than others.
Read the complete dossier
Based on “Things are Heating Up: What’s New in the Internet of Things” (Knowledge@Wharton, December 2014); “The Problem With The Internet of Things” by Dan Conlon (TechCrunch, December 2014); “Finding the Money in the Internet of Things” by John Hagel III (Harvard Business Review, November 2014); “How the Internet of Things Changes Business Models”, by Gordon Hui (Harvard Business Review, July 2014); “A Simple Explanation of ‘The Internet of Things’ ” by Jacob Morgan (Forbes, May 2014).
Watch the video:
Dr. John Barrett presents his findings about the Internet of Things.