The all-pervasive and ubiquitous Internet of Things (IoT) has made an indelible impact on our lives and businesses. The internet connected the world and the emergence of the IoT further consolidated these connections. Gartner’s definition succinctly encapsulates its essence – “The Internet of Things (IoT) is the network of physical objects that contain embedded technology to communicate and sense or interact with their internal states or the external environment.”
The IoT connects billions of devices, giving businesses an opportunity to enhance productivity, efficiency, and innovation. According to Statista, there were 13.8 billion installed and connected devices globally in 2021, and they are estimated to increase to 30.9 billion by 2025, creating a deeply connected web of devices. IoT enables seamless access to unprecedented amounts of data. Even in its nascent stage of evolution, the potential to impact business outcomes is tremendous, and is poised to bring in the next evolution in connectivity. The global market for IoT end user solutions is expected to reach $1.6 trillion by 2025.
Today, IoT is no longer just an emerging technology, but a game changer propelled by the pandemic. The IoT is enabling global businesses to build on the foundations of artificial intelligence, machine learning, big data, and the cloud to unlock new possibilities for the future. The Vodafone 2020 IoT Spotlight report, based on a survey of over 1,600 businesses, has revealed that 84% of businesses credit IoT technology for maintaining business continuity during the pandemic. In addition, about three fourths of the respondents now indicate an accelerated adoption plan.
Leveraging IoT use cases for business transformation
As companies across industries embark on digital transformation programs to engage with the digital economy, they are looking to connect physical assets with the IT ecosystem to increase operational efficiency, optimize usage, and improve the reliability of assets to generate new business opportunities.
With sensors connected to the equipment, machinery, and various other assets, the IoT has found its place in use cases across industries. These connected assets are enhancing the potential to generate and utilize data, to leverage analytics, and to provide key business insights across operations and customers. In recent years, companies have also realized the benefits of cost efficiency, security, agility, and collaboration through integration with cloud platforms and edge computing.
The manufacturing, energy, retail, logistics, and transportation industries have been the most prolific users of IoT for business transformation.
- The most common use cases are in asset monitoring and maintenance in the manufacturing industry. Predictive maintenance with the help of IoT and other converging technologies has helped manufacturers to save millions on their assets. A report by Markets and Markets indicates that the global predictive maintenance market size will grow from $4 billion in 2020 to over $12 billion by 2025.
- Retailers have used IoT based sensors to monitor customer buying patterns, customer satisfaction, send hyper personalized communications to customers, optimize product usage, monitor delivery efficiency, and much more. The global IoT in the retail market is expected to grow at a compound annual growth rate (CAGR) of almost 20% to #35.5 billion by 2025. Global retail chain, Walmart is leveraging IoT technologies to retain the freshness and quality of its food items in the cold storage sections. There are several use cases within retail supply chains and warehousing operations that ensure seamless production to store continuum.
- Smart cities are another classic example of how governments leverage IoT technologies to ensure citizens’ convenience and safety. The United Nations Conference on Trade and Development (UNCTAD) estimates that more than half of the global population now lives in urban areas. With these growing numbers, IoT has found several applications in smart cities that have decongested urban traffic, improved energy efficiency, and simplified waste management.
However, to realize the full potential of digital transformation, integration with the operational systems is critical. Let’s take the example of a manufacturing unit, where a faulty part has been detected. The operations teams will resolve the problem based on the current assessment. However, several factors need to be considered – when was the last time the part failed, how was it repaired, what spares were used, was the material available in the inventory, what skills were required, and so on. Also, it is unclear if these were mapped against how critical the part was to the operation and its potential future state. To ensure such predictability, the convergence between IT and operational technology (OT) is paramount.
The quintessential IT-OT convergence
Device connectivity with the IoT enables companies to offer better customer experience, improve operational efficiency, and reduce time and effort. How can this be made possible? As mentioned before, the answer lies in the convergence of IT and OT, which bridges IT and OT data and platforms in near real time so that information can be harnessed as a virtual single system, enabling visibility and business process rigor across the organization. Today, the data flow between IT and OT has increased significantly, enabled by IoT technologies and other methods such as in memory databases, advanced integration methods, artificial intelligence, machine learning, and analytics.
In Wipro’s conversations with several customers, we found that IoT decisions were still taken by the business. In theory, this is an ideal approach, given that business owners must focus on solving their specific business problems. However, there are several challenges underpinning this problem-solving approach.
Siloed approaches do little to foster organizational development and growth. Each department has access to an incredible amount of data that can be managed, utilized, and controlled much better to increase overall business functions. Siloed working results in a lack of holistic view. Take the example of a retail store. A store manager’s focus is on layout planning, increasing footfalls, enhancing customer retention, and so on. The warehouse manager has different priorities – ensuring products are retrieved and stored properly, supply is adequate, etc. Each of these units may have its own legacy platforms, point solutions, or varied solutions built on standard platforms, disparate databases, etc. What’s lacking is a holistic approach to ensure that the store runs smoothly in all aspects.
In manufacturing, this becomes even more complex. There are several systems deployed that could include – supervisory control and data acquisition (SCADA), manufacturing execution systems (MES), logistics and supply chains, warehousing systems, among others. Large manufacturing companies are likely to have even 50 or more different vendors for different technologies and databases. Managing these suppliers and ensuring return on investment is a challenge for chief information officers (CIOs).
CIO and CDO initiative – A strategic and programmatic approach to IoT
Today, CIO and Chief Digital Officer (CDO) organizations are increasingly looking at IoT as a bigger initiative across the organization. A survey by IDG indicated that 67% of CIOs are moving towards a strategic role in the organization, focused on revenue generation and customer centric initiatives. Most organizations have made significant investments in IoT based technologies, but the lack of an organization wide IoT strategy prevents the realization of their full potential.
There is a need for a strategic and programmatic approach in IoT initiatives, which means that organizations must take stock of the actions already undertaken and craft a future roadmap for better business efficiency. Here, a platform-based approach plays an important role. This is not to imply a radical change, but rather a consolidation is recommended. Most vendors offer seamless integration across platforms. For instance, Wipro Smart i-Connect™, our multi-domain, ready to deploy IoT solution can be seamlessly integrated with Azure or Amazon Web Services (AWS), or any other platform.
For a CIO, better control constitutes a strong technical roadmap, an effective strategy, and therefore larger benefits from use cases with cross references, cross linkages, and analytics. There are several benefits in adopting this approach. Vendor consolidation can simplify operations and therefore, vendor management. Technology costs will reduce. In addition, technology consolidation of infrastructure with the option of choosing the right base technology will benefit the organization in the long run. Last, but not the least, it will improve the ability to drive outcomes.
Today, we estimate that only 30% of IoT pilots see production. This does not imply that the balance 70% have failed; rather they have not been able to realize the envisaged benefits.
An integrated approach offers the capability to cut across service components, including systems, processes, data, and applications. While this ecosystem can deliver unprecedented efficiencies and innovation, no single platform can encompass the length and breadth of IoT. While there are a variety of platforms that can handle device integration, aggregation, presentation, monitoring, controls, artificial intelligence, and analytics, what is needed is a holistic and integrated approach to IoT implementation.
An integrated programmatic approach is not a one-time event. Nor is it an inexpensive, quick fix solution. Organizations must conduct a thorough cost benefit analysis of their current use cases. Then, they can decide which initiatives to migrate to the new environment. At some point, there may still be a smorgasbord of technologies, databases, and point solutions. The idea is to have a long-term view of the expected benefits that is aligned to the strategic roadmap of the organization. Linkages must be established and integration must take place. Take stock, make your strategies, and move in a programmatic integrated platform based approach.
If you are interested in learning how Wipro is helping our clients achieve their vision of IoT-led transformation, we should talk. Connect us
About the Author
General Manager,.Cloud & Infrastructure Services, Wipro
Ashish heads the Smart City and IoT initiatives at Wipro and plays a key role in consulting for IoT and smart city, covering integration, management, and business operations. With over 25 years of experience, his current focus is on new technologies and solutions, especially around IT-OT convergence.