Recent studies predict that by 2025 there may be as many as 100 billion internet of things (IoT) devices deployed worldwide. That's roughly 14 connected devices or sensors for every person on Earth.
My good friend Rob Mesirow and I have been spending a lot of time talking about the most practical ways to integrate "smart" technology into business processes. Rob leads Connected Solutions for PwC, and they have engineered some very interesting, and very practical, IoT solutions. Here are some of the core principles underlying their approach:
Things + Data = IoT.
Many people think of the IoT merely as "things." It's true that the IoT is made up of devices and sensors, but network-connected hardware is just one component. Data generated by IoT devices (and their associated platforms) can be analyzed to offer actionable insights and business intelligence.
Execution Is Everything.
A well-executed connected solution will improve the quality and efficiency of your business, drive revenue, and be a decision engine for your company. If you apply solid IoT design principles to alert/notification systems, detection devices, and predictive maintenance, that will also give you peace of mind.
Low Risk, High Reward.
To minimize your risk and maximize your chances for IoT success, start with a small investment, build from that foundation, and stay away from single-purpose, nonplatform solutions. Data is more powerful in the presence of other data, so a lot of small bits of data can add up, very quickly, to valuable business intelligence.
Connecting the Right Combinations.
The IoT consists of almost everything you can attach to a network: computers, smartphones, robots, drones, printers, thermostats, and even consumer packaged goods with RFID tags. To create business value with the IoT, you need the right combination of sensors, devices, software, and systems. That's why PwC prefers the term connected solutions.
Location and Identity over Tech.
To get the most out of IoT, it's critical to identify the related tasks, processes, and activities that can be automated and transformed with connected solutions, rather than simply tossing technology at every problem. There are two core parameters to focus on when designing and building connected solutions: location (where the device is) and identity (a unique identifier). When you can continuously monitor location and device identity, it's possible to make trash bins smart; ensure that building exit signs are always lit; manage pest control without checking traps manually; and make high-value assets, climate control systems, and even fuel tanks smarter.
Fuel for Thought
PwC's Connected Solutions team recently worked on a project that involved reading the level of a fuel tank. It would have been easy to place a gauge with a hydrostatic or floating sensor in the tank, equip it with a wireless transmitter, and stream data to a dashboard, so that a human would no longer have to monitor and inspect the tank.
With the goals of making a "dumb" system "smart," introducing predictive maintenance, and building a foundation for gaining deeper insights, the team studied the operations and maintenance procedures, learned how fuel was delivered and consumed, and took a deep dive into the organization's Enterprise Resource Planning system. Such a holistic approach to achieving business goals is crucial to maximize ROI.
Today, each tank can be connected to other tanks equipped with the same sensors and systems. The result? A much broader and deeper visibility into how fuel flows through the facility and how small changes can lead to significant gains. The organization now has an ecosystem of sensors and devices that deliver value and provide a springboard to expand the initiative.
A little data can make a big impact by reducing costs, informing and supporting decisions, and providing a solid ROI. In some cases, it's possible to equip systems with connected solutions at pennies per unit per month, while driving gains at a factor of 10x or even 100x.
A holistic approach to IoT also makes it easier to address cybersecurity, regulatory, and compliance issues. It also provides the ability to incorporate other digital technologies to enrich and leverage the data, including artificial intelligence (AI), 3D manufacturing, extended reality (XR), analytics, and advanced mobile and cloud frameworks. With a solid IoT foundation, a business can rewire its connection points, automate tasks, and improve data flow, leading to actionable insights.
Building a Powerful Business Model
When businesses build the right IoT framework, they can engineer simple but powerful connected solutions that make dumb things smart and smart things even smarter. And when you start small and simple and build a connected business using an open, nonproprietary approach, you can slide the IoT dial from buzzword to business value.
Author's note: Rob Mesirow, PwC Connected Solutions Leader and Principal in the Technology, Media, and Telecommunications Risk and Regulatory practice contributed to this article. Learn more about PwC's Connected Solutions here. PwC is a featured partner of the Shelly Palmer Innovation Series.