No matter the industry – manufacturing, healthcare, retail and services – digital connectivity is changing the game.
When the Internet of Things (IoT) lays claim to the corner Laundromat, it’s time for every industry to pay attention. WASH Laundry has connected laundry equipment and facilities to a cloud-based network that helps owners monitor machine usage, performance and maintenance needs. Owners can also adjust pricing based on demand.
If IoT hasn’t yet come to a business near and dear to you, odds are it will soon.
Similar networks of connected devices, predicted for decades, are now being strung together. The gradual but steady trajectory of smart device usage has led to more than 12 billion smart devices in use today, with 30 billion anticipated by 2020. This so-called “Internet of Things” has not caused more connectivity and data sharing, it has merely given the movement a name.
No matter the industry, the IoT catalyst is the same: Connecting with, and learning from, the supply chain and customers is becoming a prerequisite for innovation, efficiency and profitability.
Are companies heeding the signs? Yes, to a degree. According to a study by the computing technology association CompTIA, 60 percent of IT and business professionals say their companies have an IoT initiative underway or are conducting a pilot. Another 25 percent say their first initiative is up to a year away.
The evolution has begun: Connected devices are linking doctors with patients, retailers with consumers and even connecting competing businesses to improve outcomes and reduce costs. If IoT hasn’t yet come to a business near and dear to you, odds are it will soon.
The consumer pull of IoT
Do-it-yourself confidence and user-friendly technology has made the service industry fertile ground for IoT. Consumer demand is strong for DIY home devices. Connected home technology such as thermostats, appliances and security systems is already a billion-dollar business.
IoT has reached into the insurance industry as well, with usage-based insurance (UBI) and telematics devices that monitor driver behaviors. Depending on the arrangement between driver and carrier, insurance rates can be assigned based on miles driven, rush-hour driving or on factors like speed, lane changes and hard braking. Drivers receive “feedback” on their driving through data analysis and, ultimately, higher or lower insurance rates.
“Telematics is a powerful tool, but you also need an analytics engine that can provide insight in order to reach the data’s true potential,” says Jack Levis, director of process management at UPS. Levis is a pioneer of the ORION telematics program processing millions of data points per second to guide UPS driver routes. “If the data you gather doesn’t lead to better decisions, it’s just trivia,” he says.
Warming up to wearables
From connected devices, to connecting people to devices, wearables are gaining traction in the service realm as a way to monitor and manage both people, experiences and processes.
Disney’s MagicBand smart wristband gives visitors access to park attractions via radio frequency technology, while also compiling a history of the behaviors, preferences and purchases of park guests. In the workplace, wearables are enabling team leaders to monitor staff and redeploy people to match workflow.
Perhaps nowhere could wearables have a more profound impact than healthcare. Dozens of startups have contributed devices such as headbands to monitor brain waves and pill bottle sensors that monitor compliance with doctor’s orders.
In an effort to harness captured data, partnerships are forming to turn healthcare data into vast knowledge bases. In 2016, the American Diabetes Association and IBM began working on a repository designed to predict, manage or, ideally, prevent diabetes. Recently, Philips and Qualcomm joined forces on a data initiative to reduce avoidable hospital readmissions
If such fountains of knowledge are realized, the predictive power would be immense. It’s possible that a patient who shares a continuous stream of biometric data is matched to a “lookalike patient” in the database who developed a related, serious illness. The monitored patient could get a text suggesting an urgent doctor’s appointment, and a health crisis is ultimately averted.
While that scenario may seem futuristic, the level of industry investment implies otherwise. Price Waterhouse Coopers has estimated that the market for connected healthcare will grow to $61 billion globally by 2020.
IoT and the smart shopper
Shoppers, most with smart phones in hand, have come to expect timely news and sale notifications from their preferred retailers. Taking timeliness a step further, some retailers use Bluetooth beacons to send messages to shoppers when they walk in the door. As data mining grows more sophisticated, messaging will advance from suggestions based on past behavior to offers predicted with high confidence to result in a purchase.
UPS’s Levis emphasizes the value of building a real-time dialogue with customers. “Picture what could happen if shoppers’ feedback automatically flowed from a retailer’s mobile app back to their suppliers, who then make design changes on the fly. Improved products could be on shelves within weeks instead of months or years.”
Such supply chain agility could not only set a retailer apart, nor only reducing slow-moving inventory, but engendering loyalty by making customers feel understood and validated.
Will it be long before B2B customers demand from their vendors the timely and relevant notifications they’re getting as consumers? After all, B2B customers who brought their consumer mindset to work seemed to influence the growing sophistication of B2B e-commerce. And given the pace of technology-driven change, it’s unwise to brush-off ambitious-sounding scenarios. In fact, it’s more likely that data privacy issues will slow the pace of IoT than any limits of technology.
IoT is happening. Who’s on board?
Now that laundry machines, thermostats and theme park guests are becoming smart devices, what becomes of businesses not subscribing to the IoT revolution?
“The Internet of Things is an actual network of real, physical things,” says Daniel Cooley, general manager of IoT products at Austin,Texas-based Silicon Labs, Inc.. "Maintaining a growing network of real, physical things involves all kinds of costs and needs you don’t see in software at scale.” Not all companies are comfortable adding high-tech to their repertoire, of course. “Not all of them will be around in the future because of it,” he concludes.
Charlie Covert, vice president of customer solutions for UPS, sees another hurdle to IoT. “Inertia is the enemy,” he says. “Because IoT sounds like a buzzword, it is often relegated to a long list of corporate initiatives.”
Covert adds that greater connectivity and smarter decisions through data are becoming the new normal for every industry. “History has shown that fundamental change in business caused by technology is inevitable,” he says. “And history has also shown that it’s better to embrace the disruption than to be run over by it.”