The Internet of Things (IoT) has become a mainstream business driver. But how are leaders approaching implementation? Explore key insights from our 2019 IoT Signals research into the increasingly important role of IoT.
IoT is driving both opportunity and revenue
IoT is the gateway to business transformation, creating significant opportunity for companies. While 88 percent of companies credit IoT as critical to their success, it is one of a series of catalytic innovations that are creating connected businesses: Cloud, IoT, Edge Computing, Artificial Intelligence and Mixed reality.
Connected endpoints across sales, products and physical assets give leaders unprecedented visibility into their businesses and new insights into how to optimise operational efficiency, innovate, increase workplace safety, save energy and more.
But how prevalent is the implementation of these IoT initiatives? In a survey of more than 3,000 IoT decision makers in enterprise organisations, 85 percent of decision makers have adopted IoT and 74 percent have projects in the "use" phase. We heard from businesses adopting IoT that they believe they will see a 30% ROI on their IoT projects in the future. However, as IoT matures, there are three key obstacles that companies must address: security threats, project complexity and the growing skills gap.
Concerns not hindering adoption
Nearly all companies (97 percent) have security concerns when adopting IoT. But, with implementation on the rise—particularly among critical industries like healthcare—security must be addressed from the beginning for both devices and networks. Internet connectivity is a two-way street. It’s more important than ever to address security in every layer because IoT devices provide digital access to home and work networks – and the sensitive data stored there.
Among companies surveyed, the most important security aspects are:
Device tracking and management
Top IoT Use Cases
Industrial IoT in action
There will be more than 20 billion connected devices by 2020, but IoT is more than just your smart speaker and thermostat. Connected devices have the ability to save energy in smart buildings, improve the flow of traffic in congested cities, increase crop yields, prevent equipment failures on a factory floor and power medical breakthroughs.
Companies adopt commercial IoT for operations optimisation (56 percent), followed by employee productivity (47 percent) and safety and security (44 percent).
However, different industries have unique uses for commercial IoT:
- Industrial automation
- Quality and compliance
- Production planning and scheduling
- Supply chain and logistics
- Plant safety and security
- Fleet Management
- Security, surveillance and safety
- Manufacturing operations efficiency
- Vehicle telematics and infotainment
- Predictive Maintenance
- Supply chain optimisation
- Inventory optimisation
- Surveillance and security
- Loss prevention
- Energy optimisation
- Tracking patient, staff and inventory
- Remote device monitoring and service
- Remote health monitoring and assistance
- Safety, security and compliance
- Facilities management
- Public safety
- Infrastructure and facilities management
- Regulations and compliance management
- Fleet and asset management
- Incident response
Pioneering mainstream IoT adoption
No industry has seen the benefits of IoT more than manufacturing, where the intersection of equipment monitoring and remote command comes together with big data and advanced analytics. Operational cost reduction, agile production implementation and improved worker safety are just a few reasons why manufacturing has been quicker to embrace IoT than other industries.
Meet Dave, a decision maker at a golf club manufacturing company, where he uses IoT to ensure the quality of their golf club heads as they’re being produced by vendors. He believes IoT is critical to success. Let's take a look at his process and where IoT comes into play—now and in the future.
I absolutely think our use of IoT will increase. My goal is to make it as automated as possible and as seamless as we can so that we are getting quick data as the product is created.
Create a concept and specs for a new golf club head.
2. Test batch
Send specs to overseas vendors to produce a test batch.
3. Validation and Quality Assurance
Test the batch for durability and performance quality using real-time data via connected machines at vendor sites.
4. Mass production/assembly
Using production equipment containing sensors to determine maintenance needs, vendor partners produce the club heads and send for final assembly.
Ship final products to customers and sellers using inventory tracking sensors.
6. Future IoT use
- Converting IoT-connected production machinery and equipment from hard-wired to WiFi-based.
- Applying the validation system to other components of golf clubs, such as shafts and grips.
IoT skills gap
Skills gap holding back potential
Despite its rapid adoption, IoT is not without challenges. Even when IoT is adopted, the same adversities can hinder success.
Only 33 percent of current adopters feel that their companies have adequate workers and resources to see their projects through to realisation.
Companies with enough skilled workers:
The opportunity is vast for businesses to get ahead, but the skills gap must be prioritised for IoT to realise its true potential.
- Propel more IoT projects into "use" stage
- Reach the "use" stage in less time
- Fail fewer times in proof of concept state
- Experience fewer challenges
- View IoT as a stronger investment