When the famous management consultant Peter Drucker said “you can’t manage what you can’t measure” I doubt he imagined a world where almost anything could be measured and that data instantaneously transmitted to a system where machine learning and smart algorithms could analyse the data and provide support for business decisions.
But that’s the world we are heading into.
By the end of this decade, there will be around 20 billion devices connected to the Internet. You’ll scarcely be able to walk into a room that doesn’t have some sort of connected device. That might be a lighting system, air-conditioner or window-shade if you walk into an office. But it also includes all there smartphones and tablets we carry, TVs and media players in our lounge-rooms, smart speakers like the Google Home and Amazon Alexa or the security cameras that protect our assets.
For businesses, those devices, which are typically the most popular are just the tp of the iceberg. In a factory, sensors, that connect to intelligent systems, will tell you when they aren’t operating at their optimal efficiency so you can adjust their performance. On farms, livestock can be tracked – not only for their location but their health with sensors now able to measure and transmit vital information.
The Internet’s purpose has always been to connect computers to each other. When Dr Robert Metcalfe created ethernet, for physically connecting devices together, Or Dr Robert E. Kahn and Vincent Cerf invented TCP/IP so computers could communicate using a common networking language, these didn’t expect their inventions to so fundamentally change the world. As Dr Kahn recently said “It wasn’t obvious that the internet was ever going to happen or even be a good idea”.
Those tools developed in the 1980s are now used to connect almost any devices that can capture and transmit data.
The recent announcement by the operators of Sydney’s train system highlights how the IoT can benefit a business’ customers. By using sensors that weigh each carriage of a train, the rail authority can deduce whether a carriage is full or has lots of empty seats. That information is sent to a central service that delivers the information to commuters through apps that allow them to easily find a seat.
In Europe, the Hamburg Port Authority manages the third largest harbour in Europe. The authority’s CEO, Jens Meier says their challenge is to double the port’s capacity without doubling the space it uses. And that means they need to use the existing infrastructure more intelligently and sustainably.
That means collecting data, processing it quickly and delivering useable information to people on the ground in realtime. That happens through the collection of data using IoT devices such as sensors, sending that to the SAP HANA cloud for processing and to workers on the ground using tablets and other portable devices. In the first three months after going live with their transformation predict, the port was able to increase efficiency by 12 percent. And the data isn’t just about the port. Hamburg can communicate with ports around the world to become more efficient.
In Buenos Aires, new sensors deployed as part of city-wide IoT project let them bring together data from multiple sources so that the city, which is located at the mouth of the Río de la Plata, can be forewarned when there’s potential flooding. This is a major concern, particularly after the 2013 floods which took many lives and destroyed vital infrastructure in the densely populated city.
How do you prepare to integrate IoT into your business in this way? “Use proof of concepts to learn and explore how to improve processes, to create new business processes or even new business models”, said Rob Delnoij from the SAP Innovation Office. “Infrastructure and networks and skills will follow”.
So, where is the IoT business now? Gartner says IoT is moving beyond the hype into a much more pragmatic and operational phase of planning, execution and value delivery. So businesses are now looking for best practices and critical insights from their peers across different geographies, verticals and use-cases.
Delnoij said “Business processes that have the potential to be improved or reinvented based better, more accurate, real-time information being available are good candidates for IoT-based solutions. IoT is about connecting things, people and processes”.
- Read more from SAP: Insights on the Future of the Internet of Things
But getting it right will be a challenge they say. Gartner predicts that by 2021, 30% of IoT investments will fail to meet planned business objectives. And by 2020, just 25% of managed IoT service engagements will guarantee an ROI. Making sure you’re on the right side of those numbers will take some careful planning and work.
The platform should be flexible to support all kind of IoT processes and devices and have open APIs said Delnoij. That will simplify integration to business processes
“The platform should be scalable so it can grow and support future developments and provide support for edge computing,” he added. “While it is also crucial to choose a platform that provides other emerging technologies such as machine learning and blockchain to ensure you can fully leverage all the information you receive from your IoT sensors”.
About The Author
Anthony Caruana is a Melbourne-based technology journalist who writes for Australian Macworld, The Australian Broadcasting Corporation, several titles from Next Media, IT Wire and many other publications. SAP is a corporate member of the Which-50 Digital Intelligence Unit. Our members provide their insights and expertise for the benefit of the Which-50 community. Membership fees apply.