For most business leaders, the question is not whether to adopt Internet of Things (IoT) solutions, but how best to use them. What do you need to know to turn the IoT into a competitive advantage for your business?
The IoT is not new. Organisations began using sensing, diagnostic and communications equipment to track spacecraft, weather balloons, wild animals and other important ‘things’ more than two decades ago.
What is different today is the pace of IoT innovation, which is opening up new possibilities for a much wider range of businesses and industries.
According to AT&T’s latest Cybersecurity Insights report The CEO’s Guide to Securing IoT (PDF), 85 per cent of global organisations are considering or exploring an IoT strategy. One-quarter of these have already piloted or implemented IoT projects.
The promise of bottom-line benefits will continue to drive IoT adoption, but success is not as simple as just connecting devices to the Internet. Asking the following three questions can help you ensure your team is on the right path:
1. How can we transform our business processes with IoT to deliver value?
Companies used to deploy IoT solutions to either improve efficiency or save cost. With advances in information and communications technology, organisations can now look at IoT services as a way to increase customer satisfaction and enable new business models or revenue streams.
For example, water scarcity is intensifying worldwide. With rapid population growth and large-scale urbanisation, access to freshwater is only going to become more problematic in our region. Smart city solutions that use IoT and acoustic technology to detect leaks in water mains are now being developed to help detect water loss and minimise damage caused by leaking pipes.
The aim is to be able to rapidly retrofit these new IoT solutions into existing mains networks to give communities greater visibility into their water supply and, in the longer term, to also motivate the public to conserve water. As this shows, even complex legacy systems need not be a barrier to IoT success.
2. Will our IoT plans generate a real return?
It can be illuminating to look ahead to how your industry, customers and business may change in the next two to five years and to consider how the IoT can support these changes to deliver a real return.
In the logistics sector, overcapacity is expected to remain an issue in the next few years as Asia’s manufacturers cope with muted global trade and slower economic growth in China. Transport providers are thus seeking a competitive edge by using connected devices to efficiently track shipments in the air or on land or sea, providing operational visibility and access to valuable real-time information.
In a 2014 global survey of shippers and logistics providers by EyeForTransport Reports and AT&T (PDF), 80 per cent of companies seeking to expand their existing IoT solutions expected to see a return on their new deployments within two years.
As a business leader, you understand your industry and your customers, and you know which connections will drive maximum value for your business. What you are unlikely to have is the in-house talent to design, test and build IoT solutions that leverage this knowledge.
Since the IoT decisions you make today will impact your business tomorrow, it makes sense to access expert outside help and use your resources strategically.
3. What security risks do our IoT deployments bring, and how will we mitigate them?
While cybersecurity is already top of mind for many organisations, IoT deployments can amplify the risks. For a start, the scale of connected devices greatly increases the complexity of cybersecurity and the volume of data that needs protecting. The challenge intensifies as IoT devices are deployed to control infrastructure, such as factory operations and supply chains.
The connected car is one example of IoT that many of us will directly experience. Machina Research estimates that there were about 125 million IoT connections in the global automotive sector by the end of 2014. By 2024, this will have grown to 1.2 billion.
The world is welcoming IoT-connected cars and their promise to improve safety, reduce operational costs and streamline traffic flow. However, the possibility that a hacker may be able to unlock and enable a car’s ignition, or remotely take over mission-critical systems such as brakes or steering, is too frightening to ignore.
The answer, for the automotive sector and other industries, is to build multiple layers of security controls into IoT devices and their connecting networks. In the connected car, this will mean separating critical safety systems and engine control units from infotainment and tethered device connections.
Here, as in all industries, the entire IoT ecosystem will need to be involved from the start; security has to encompass not just your own devices, data and applications, but those of your partners and customers as well.
Focusing on IoT as a strategic advantage
The technical and security challenges of an IoT implementation can be considerable, but they are not insurmountable. For most companies, putting time and effort into achieving the strategic advantages that IoT can bring will deliver great value for your organisation, even in light of these challenges.
Finding a skilled and experienced partner to help you manage your devices, connectivity, platforms and applications can lead to a successful IoT experience.
Sandy Verma leads AT&T’s Internet of Things Strategy & Solutions in Asia Pacific. Verma, based in Hong Kong, joined AT&T in the United States in 2001.