The Internet of Things (IoT) is slowly but surely extending its reach into the enterprise and across many different verticals. However, while many enterprise leaders have welcomed the advantages IoT gives them, particularly in terms of customer insights, there are still major concerns and challenges, especially in terms of privacy and security.
IoT Challenges for 2019
It is clear that IoT enables organizations to extend their reach directly to their customers. For example, if a device is sold through a partner or retail channel, the original vendor can now connect directly with their customers bypassing the channel. And it also allows for new interactions and creation of new ecosystems. However, according to Andrew Hatfield of Mesosphere, many challenges still remain they include the following.
- Only 20 percent of new potential interaction points will deliver new revenue.
- The explosion of IoT and the uncertainty of what will produce revenue is already leading to the need for additional predictive analytics.
- As organizations scale IoT products, performing machine learning and AI on the Edge will become necessary as customers demand fast and accurate response times.
- Connecting these new IoT enabled products to existing enterprise IT applications is a priority for most organizations, but will create problems.
- Security of data remains a challenge across the entire IoT spectrum.
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IoT Has Made Progress
These, however, are problems that can be solved and IoT has made progress, said Jamie Bennett, VP of engineering for Canonical. Bennett pointed out that in 2018, IoT increasingly moved from proof-of-concept to widespread production, with the number of connected devices owned by consumers growing from 35 percent in 2017 to 44 percent in September 2018.
But vulnerabilities are threatening to tear down trust in the connected world, especially as IoT moves into B2B spaces and industrial sectors where risks are much higher. Security must take precedence over innovation if confidence in IoT is to grow and severe security issues are to be avoided. “If we get this right, though, adoption will continue at an exponential rate, greater consolidation will drive developers to edge computing, while connected applications will unlock multipurpose robots, leading to far greater capability and functionality,” he said.
IoT Providing ROI
Even with these issues, IoT investments are starting to deliver ROI, according to Scott Gibson, group executive for digital business solutions at Dimension Data. Gibson said that some of Dimension’s clients are starting to see a positive impact on corporate profitability from their IoT implementations and that they are expecting this trend to accelerate in 2019.
The kind of projects that produce a concrete financial improvement tend to be those that look at data through a new lens and apply IoT at multiple points in the value chain. The best business outcomes are obtained when you use IoT to monitor an entire business process and blend your own data with third-party sources.
He cites the example of the Royal Swaziland Sugar Corporation, which is using IoT throughout the process of growing, transporting and processing sugar cane. This is increasing their efficiency at every point and improving corporate profitability. The company’s CIO, Rob Coombe, sums up their IoT-driven approach by pointing out that you can't go digital in silos. It has to be done holistically in order for it to work.
The IoT will continue to expand next year and reveal new ways of interacting with customers. Retail and supply chain industries will likely see the greatest growth as compared to 2018 (indoor navigation, smart barcodes, cashierless supermarkets, etc.). In certain countries including North America, China and Japan, the impact will be even greater.
Related Article: How to Deal With IoT Security Threats
Moving to Edge Computing
Edge computing is already a key element in this. Simon Jones, VP of marketing at PubNub, said that for enterprises to keep the deluge of data streaming to and from IoT and mobile devices under control, computing will have continue moving to the edge. “We need new computing infrastructure that lives beyond the centralized data center. More advanced computation is required, and pushing it to external servers is increasingly expensive and wasteful. Traditional web infrastructure is clearly insufficient, especially when looking to the future,” he said.
He cites the rapid growth and transmutation of data stream-based apps, as an example. Communication favorites like WhatsApp have dominated the globe for years, but continue to spin out new capabilities to attract and monetize billions of users these apps aren't just for making our personal and work lives better. Big data-driven platforms, like the Climate Corporation's FieldView, brings digital solutions all the way out to farmers in the field, enabling optimization of productivity, crop performance and planning, insurance reporting — in other words, intelligence vital to sustaining the global population.
Edge computing addresses these challenges because logic can be executed on devices closer to the edge, or at the edge, reducing the traffic sent to external servers. Likewise, enterprises don’t have to keep adding data center capacity to accommodate growth; as new devices are added and removed, most of the burden is on the edge devices.
Unlocking IoT Data
As a result of pushing computing to the edge, at the end of 2018 we saw businesses really unlocking the value of IoT data. Companies created environments in which new business models started to emerge along with changes in work processes, productivity improvements, cost containment and enhanced customer experiences. Analyzing this massive amount of sensor and device information can help enhance AI and machine learning, it can also uncover new insights capable of transforming industries.
Tools like graph analytics is a natural way to analyze the data, find patterns and relationships, and monitor in real-time. Relationships may be analyzed to a level of detail that can better inform maintenance service intervals for specific locales, and even future design changes.
At the end of 2018, it is clear that IoT sensors allow for large volumes of data to be collected and stored, providing companies with insight into equipment health, performance and failures. Every IoT unit can generate hundreds of thousands of data points every minute. The challenge at this stage is figuring out how to organize and prioritize all this data.
Performing data analytics on all this information is not feasible nor is it an efficient use of resources since some of the data being collected holds little value in determining asset health. Companies need to consider what data to prioritize so that they can more quickly identify needs.
IoT represents transformative technology, but a successful IoT strategy for industrial and/or consumer applications must work today and be flexible enough to accommodate whatever comes next. With the right goals, plans and tools, IoT can go well beyond an inflated buzzword. In 2019, it is likely that it will grow into a tool that provides practical value every day for both customers and service organizations.