The Internet of Things (IoT) is a term we’ve all been using for more than 20 years. Yet, it feels like we’re not entirely sure about its definition, where the technology is used, and why Google Glass even became a thing (let alone why it flopped).
Postindustria has been at the forefront of this technological evolution, building Internet of Things applications, managing IoT projects, and exploring the field as it develops to help our clients optimize the technology. Read on to discover what’s so special about the Internet of Things and how it moves businesses forward.
IoT refers to the physical devices (things) containing sensors and software, connected to the internet. Currently, these devices number in the billions as they collect, process, and exchange data with other devices and systems. IDC Data estimates that, by 2025, 152,000 new devices will be connected every minute—that’s nearly 80 billion devices connected annually.
93% of enterprises and 80% of industrial manufacturing companies were expected to adopt IoT by the end of 2020, with global spending reaching $124 billion by 2021 and $1.1 trillion by 2026.
How did we get here? Back in what now seems like the Stone Age, but was really the 1980s, a vending machine at Carnegie Mellon University was connected to ARPANET, the predecessor of today’s internet, to become the first IoT device. The term “Internet of Things,” however, was coined in 1999 by British technologist Kevin Ashton while working for Proctor and Gamble.
Throughout the 1980s and 1990s, chips were big, bulky, and expensive, and the limited network capability could not support broad device connectivity.
The widespread adoption of Radio Frequency Identification (RFID) tags helped make more “things” connected. These were cheap basic transponders that could be stuck on any object to connect it to the larger internet world.
Another important development that accelerated IoT was the adoption of Internet Protocols, which paved the way for the billions of gadgets to be connected to the internet without exhausting the available IP addresses.
Cisco Systems estimates that by 2009, the number of objects connected to the internet outnumbered the world’s human population. These years were the pivot point when interest and practical applications for IoT took off.
IoT devices range from ordinary household objects like refrigerators and ovens to sophisticated industrial robots and driverless cars. Tesla’s Model S informs us of weather and traffic conditions while we drive or, more accurately, while it drives us to our destination.
In addition to household and consumer-focused applications, the IoT of healthcare promises to revolutionize how medical treatment is provided. Consider virtual hospitals delivering outpatient care remotely, wearable wireless biosensors that monitor patients 24/7, and smartwatches that take ECGs and measure pulse and blood oxygen levels.
What does this mean for you and your company? Savvy businesses are watching IoT trends and using it to obtain real economic benefits. No matter what your business is, Postindustria can help you identify ways to leverage this technology.
Here are some examples of how companies have implemented IoT to achieve their business goals.
IoT monitors equipment and reduces downtime by predicting failures in an operation before it happens. A case study of Fiat Powertrain Technologies (FPT) explains how temperature, vibration, and energy consumption sensor data are used to determine the maintenance periods within the Remaining Useful Life (RUL) of parts to avoid high downtime costs.
Using IoT to monitor stages of production and track materials and parts allows just-in-time delivery of materials and more efficient management of the entire production process.
The DENSO Corporation, a global automotive components manufacturer, is using Toshiba to build its IoT infrastructure to improve its productivity. Toshiba’s innovations allowed DENSO to use thousands of new data points that, when combined with their existing data, helped DENSO realize a 6% improvement in productivity in just three months.
Energy costs are a significant part of operating expenses for most companies. IoT-based applications give decision-makers real-time information on how to minimize the unnecessary use of electricity and reduce operating costs.
For a beverage manufacturing facility, reducing the cost of raw materials was not an option, so greater electrical efficiency was their target for reducing operating costs. Data collection sensors on equipment transmitted wirelessly to a central database, allowing management to pinpoint energy consumption with specificity, saving $172,281 annually.
The IoT technology also makes remote working more seamless, improving employee productivity. Automating selected tasks enhances business services and reduces the need for human intervention.
A study of UK employees determined that the average employee spends 25 minutes per day preparing and consuming snacks and beverages. An IoT-enabled coffee machine could reduce waiting times and increase productivity by 5-6% by brewing coffee as the person walks to pick it up.
A Bain & Company survey of 362 firms found that 80% believed they were delivering a superior customer experience; only 8% of customers agreed.
The key to your business success is understanding your customer preferences and behaviors for a positive user experience. IoT can collect, monitor, and analyze data to predict preferences and trends, so your businesses can adapt and better respond to customer needs.
IoT allows more data points of interaction between the customer and the organization to assess and improve the customer experience.
Outstanding customer service, satisfaction, and retention are significant drivers of profitability for service companies. For example, IoT devices such as ParceLive allow for both customer and supplier tracking of packages and include location, condition, environmental parameters, and security.
Human error causes some of the largest business losses. A plastics manufacturer with 20 different product lines struggled to avoid errors with 20 input parameters that changed daily. IoT implementation enabled them to control all processes with one “click” instead of the 30-40 previously required. In some cases, this reduced downtime and increased productivity by 100%.
Connected devices need to be able to communicate with each other seamlessly. However, currently, there is no international body responsible for IoT compatibility standards or technologies.
Security is another major IoT issue. The connected devices collect tremendous amounts of sensitive data, and anything connected to the web can be compromised if not protected. A web-based thermometer in a casino aquarium was hacked, and sensitive customer information was extracted.
Businesses must take a proactive approach to cyber threats, including safeguarding company hardware, encrypting data, backing up information, obtaining cybersecurity insurance, educating employees, and using anti-malware software along with an effective firewall.
The number of IoT devices is expected to continue to grow through 2025. Nick Earle, Eseye CEO, believes that 100% connectivity of every IoT device will facilitate the disruption of traditional business models, improving process efficiencies and reducing costs.
One example of this is a spice company Freddy Hirsch which sells IoT-enabled sausage machines optimized to use their spices. This service directly to the end-user cuts out the middleman and spices up their competitors.
The physical world should merge with the digital world to move society forward. And thanks to cloud computing, analytics, and mobile technologies, physical things can share and collect data with minimal human intervention. So why don’t you use it to your benefit?
At Postindustria, we’ve been providing organizations with creative IoT applications to meet their IoT needs since 2006. Our wide variety of industry-specific experience sets us apart from other businesses moving into this space. If you’d like to take advantage of our experience for yourself, contact us anytime. Let’s develop your Internet of Things project together.
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