By Ashwini Kamble, Technical Evangelist, Cybage Software
The next industry revolution is on its way in form of Internet of Things (IoT) which is leading open innovation, generating new revenue streams, and building connected solutions. Analysts are already predicting numbers around market valuation, the industry is widely adapting to this phenomenon, and things are getting realized in a much accelerated mode. Along with bringing value for enterprises, it is also taking the form of IT consumerization and opening up a multi-partner relationship model. Enterprises that are not inclined to adapt to digital transformation or are ignorant about new technology development might lose business and identity, as it has happened in the past. The ‘wait and watch’ scenario for business leaders and decision makers is no longer viable.
IoT, in its true definition, has given identity to things by connecting devices, sensors, applications, and services. It goes beyond Machine to Machine (M2M) technology that focuses more on connecting devices, capturing and transmitting data to generate alerts and actions. Today, M2M is considered as an integral part of IoT.
Before the advent of IoT, the industry outlook was to bridge the physical and digital world to get closer to the customer, improve customer experience, offer personalized services, build brand value, monitor assets for optimum utilization, provide uninterrupted services in adverse environment, and keep business future-proof by practicing data-driven decision-making in near-real–time mode.
Businesses were looking for a paradigm shift from a manual to a technology-centric approach for customer-facing initiatives. They wanted to identify new revenue sources, monetize existing assets, and most importantly, adopt solutions that could cut across various industry verticals and build differentiators to survive in a highly competitive environment.
Emerging Opportunity Landscape
IoT services hold a tremendous potential to address business expectations; the opportunities are ample and evolving as the landscape of convergent technology matures. Some of the key benefits of adopting IoT are profitability, operational efficiency, competitive advantage, quick decision-making, speedy deployment, asset mobility, process automation, and systems integration.
Following are snapshots of key IoT-driven solutions:
- Smart solutions as evolving services
Services that can help enterprises to get closer to consumers with an omni-channel presence while offering core or smart services such as smart home, smart meter, and smart parking.
Enterprises are in a better position to resolve operational problems by connecting E2E services such as asset monitoring, service consumption, operation efficiency, and connected customer. They can proactively identify revenue leaks and open opportunities, and improve existing service offerings by adopting various analytical models, which are the key to digitalization.
The prospects of evolving a new business model by connecting various industry verticals to achieve data and asset monetization and accordingly designing new services seem to be bright in the market.
- Smart solution as evolving business cases
Serving various smart solutions opens ups avenues and spawns a variety of business cases not directly related to the same solution. For instance, implementing a smart parking solution can indirectly help to reduce the carbon footprint by routing the customer directly to the available slot. It can also ensure a smart lifestyle by allowing the user to reserve a parking slot right before starting the journey and making all data accessible on handheld devices in a hyper-connected world.
- Smart solution by empowering and engaging people
In an increasingly urbanized scenario, a responsive city is very important. Practical approach for city councils would be to implement a smart city. This can be achieved by connecting all departments using public-private partnership to serve citizens and visitors, and building sustainable infrastructure for a smarter life. Worldwide, governments have initiated ‘open-data’ strategy programs to help generate unique ideas and applications for the betterment of cities and individuals, clearly indicating a transition towards a bottom-up approach in a collaborative mode.
Fostering Entrepreneurship and Emerging Players
IoT provides a wide opportunity landscape. Not limiting itself to just industry verticals, it touches various aspects of human life.
For example, imagine deploying sensors to any specific medium such as utilities, machines, open environment, which registers features, detect events, monitors operations to generate sensible data and pushes this data to a central hub through any available network. This volume and variety of data serves as an asset, which can be used to generate various experiences, actions, capabilities and more importantly, to directly control things. All these experiences can be packed under various services and new business models.
The varying picture of business, various revenue sources, smart interaction with enhanced efficiency, sustainable scalability, shorter time-to-market, technology within reach, and controlled CAPEX are factors driving the rise in startups and entrepreneurship. The market is also predicting the emergence of new players and services models in this space.
Major Building Blocks
The major building blocks of IoT are data acquisition, transmission, and value analytics. The IoT ecosystem involves sensors, global SIMs, network links, platforms, applications, and smart devices and smart consumers.
Technology drivers are mainly mashup networks, gateways, aggregators, cloud, Big Data analytics, and mobility.
As the backbone of IoT, communication service providers have to play a bigger role in terms of SIM cards, IoT-inclined networks, service activation, billing, roaming, SLAs, and much more.
Players such as equipment suppliers, platform providers (application and services), telecom operators, and integrators have to build a consortium to deliver vertical-specific or horizontal-specific solutions or both.
The vision of IoT is propelled by an omnipresent network, functioning at an incredible scale and cost.
Mass manufacturing in affordable cost has made sensors cheaper, boosting the economy of scale. Sensors are taking the form of nano devices that consume less power, perform multiple tasks, and provide options to increase sensors’ life exponentially.
IoT platforms are maturing and beating the market at an accelerated speed, be it services or application platforms, and are increasingly becoming compatible with a variety of sensors and networks to ease integration.
Global acceptance of cloud computing, a wide variety of smart and wearable devices to choose from, and affordable data networks are expanding the reach of IoT applications.
Worldwide, regulations are being relaxed to encourage adoption of IoT solutions, with the IoT ecosystem maturing and providing enterprises multiple options to build profitable business ventures.
IoT is a multi-vendor game, enabling convergence of technologies and industry segments. Aligning services and products seamlessly is a key challenge for businesses.
Evolution of standards that can cater to a complex ecosystem. These standards should be independent of geography and verticals.
Security is a big concern. Enterprises need to inject extra gates to prevent fraud, hacking, accidents, and other security threats.
In case of disruption of services to the customer, segregation of responsibilities and a compensation model are matters that need deep thought and foresight.
Sharing the revenue pie among business entities, overcoming the pressure of margins of saturating business, and survival in a digital-centric environment are among the other challenges.
#1 For Enterprises
Enterprises need to consider building a robust digital transformation strategy. They have to clearly differentiate between IT modernization and digital enablement.
Some enterprises are creating and restructuring dedicated divisions for digitalization with specific KRAs to strategize, build brand loyalty on social networks, understand consumer trends, create execution models for digital initiatives, and showcase value generated.
Instead of going out all guns blazing, these strategies need very short roadmaps with tactical, tangible, and traceable objectives and actions with a continuous evaluation of digital stories.
#2 For System Integrators
Delivering a successful IoT program requires integrated offerings and higher levels of expertise and solutions. Hence, system integrators need to take a consortium route to achieve their objectives.
System integrators need to build expertise around convergent technology skills and create a pool of talented IoT architects. A paradigm shift is needed to pave the way for digital-centric programs, away from the legacy way of handling projects. Leaders need to constantly update themselves about the latest trends and map core capabilities of their organizations that can be served under the digital umbrella.
The entire project delivery model needs to be revamped. Experimental exposure is required for practicing open-source, automation, component selection with a good budgetary control of the overall program.