The internet of things (IoT) is certainly one of the biggest trends in tech right now, and its popularity is growing day by day. There has been some impressive statistics in recent years about the internet of things (IoT). For instance, since 2011, General Electric has publicly stated it would spend more than $1 billion on developing sensors, wireless devices, and related software to install on its aircraft engines, power turbines, locomotive trains and other machinery.
Besides, companies such as Ford, Toyota, and Caterpillar have invested heavily as well. Based on a survey of 795 large companies (average revenue of $22 billion) in North America, Europe, Asia-Pacific, and Latin America found average per-company spending on IoT initiatives — $86 million in 2015 — was projected to grow to $103 million by 2018. Despite the fact that the commercial opportunities in IoT are hyped in the media, many businesses have so far been cautious, remaining on the sidelines of this developing field.
So the question remains: Is it finally time for company leaders to take part in the technological revolution and integrate the Internet of Things into business life? Or is the commercial world still too suspicious of IOT’s potential to take advantage of it?
How can IoT help your business?
IoT has the capacity to boost day-to-day efficiency for businesses. Using data collected from social networks, traditional media, and internal and external networks provides actionable intelligence that empowers machines and people to optimize their behaviors. IoT technologies can provide company leadership valuable feedback into how a company might improve their product functionality along with better user experience, as well as streamline production processes and supply chain management.
Since such solutions can process more real-time data in a particular timeframe than a human could ever hope to, they also play an essential part in developing financial decisions by providing real-time insights into the state of the business as a whole. Additionally, the actionable intelligence sourced from IoT solutions complements that from a company’s accounting systems and enterprise resource planning (ERP) and, when taken together, executives are able to get a view of the venture’s state and provide insights into possibly rewarding financial strategies.
The benefits of IoT solutions are priceless – yet, some researchers have managed to put a number on the potential financial gain. A 2015 McKinsey study shows that IoT stands to save global businesses up to $11 trillion annually by 2025. Various other experts in the field project that the technology will boost corporate profits by as much as 21 percent by 2022.
Such statistics are indeed meaningful; a survey found that 45 percent of executives said that IOT-enabled manufacturing was a high or very high priority for their ventures. Remarkably, only 21 percent of those involved in the study worked directly in the manufacturing sector — a detail that implies that the interest for IOT goes far beyond its surface capabilities.
70% of Fortune 100 Companies Use the IoT
While the Internet of Things is popular in consumer application, most IoT developments are made for large organizations. A report by AppDirect, an IoT company specializing in cloud data management software suggests that seven out of ten Fortune 100 Companies offer IoT products, services, or initiatives.
Below are few of those companies and what they are up to with the IoT:
General Electric (GE) founded GE Digital in 2015 with the goal of using IoT to predict maintenance needs. They created Predix, a software that takes data generated by machines and combines it with traditional data. All of this information migrates to the Cloud for analysis. GE has IoT products for the hospitality industry, the airline industry, and utility companies.
Cisco has a diverse foothold in the IoT market. Their digital infrastructure provides services that connect and automate factories. Cisco Smart Grid technologies are used for utility services (mass transit, aviation) and energy control (oil, gas.) Their infrastructure also monitors and aggregates data related to energy usage and distribution, application management, wireless networks, and IoT integrated cyber security.
Google bought Nest in January 2014 for over $3 billion. Nest sells “smart” fire detectors that “learn” their environment through energy patterns. While smart home technology is one of the most popular IoT consumer applications, Nest was one of the first companies to market. Google also offers the Google Cloud Platform. It allows businesses and users to manage their data from anywhere.
What areas of IoT are Companies Investing In?
Intel filed a report about where and how major industries are exploring the Internet of Things. Here area some of the areas where the big players in the IoT game are spending their money:
40.2% invest in Business and Manufacturing processes. This includes supply chains, robotic machinery and other industrial equipment. And real time analysis of the data collected from these operations improves their workflows, machine safety and bottom line.
30.3% invest in IoT Healthcare technologies. This could include anything from portable medical equipment, data management, and safeguards for the distribution, sale, and manufacturing of pharmaceuticals.
8.3% invest in Retail applications. Consumers can use smartphone apps to purchase products and the company can track and analyze their purchasing data. IoT is also instrumental in efficient inventory management.
7.7% invest in IoT Security innovations. Companies with highly sensitive materials can utilize biometric locks or facial recognition technology. Smart locks with remote sensors and linked security systems offer a higher level of security than traditional alarm systems.
A survey conducted by PricewaterhouseCoopers (PwC) and Messaging Application Programming Interface asked 57 manufacturers and business suppliers “Which IoT-driven business models is your company currently deploying?”
47% of respondents offer IoT services bundled in with their products. This could be a product designed to interact with the Internet of things or an IoT enabled means of gathering customer data.
30% of companies surveyed offer an IoT related product as service. Examples of this include remote data monitoring, the analysing of this data, and the selling of the data.
4% of respondents offer a fully-integrated IoT service. This could be an entire software platform that provides IoT solutions to other companies (such as Cisco and AT&T.) These custom created IoT platforms can provide their users with unlimited sources of data.
19% of the companies surveyed report “Other” business models. Those models reported include:
– Offering a free IoT feature to their users
– Adding functionality to an existing product via IoT technology integration
– Selling maintenance, monitoring, or performance contracts on IoT technologies and equipment
– Using the IoT in Product Development phase
It is certain that IoT can help businesses to better serve customers and stakeholders. However, to fully realize IoT’s potential, companies need to approach it as a multifaceted journey, making changes to their business models and strategies.