The Internet of Things is now a very effective way to bring the digital world to the physical world, a way of closing the gap between information systems and the field. In the past, there was always a divide between the two since field data were not integrated into the information system. Most often, field data were incorporated later, in “batch” mode or by manual entry, which made it impossible to use them in real time and limited the ability to respond to market demands or uncertainties in operations.
With the Internet of Things, data are integrated in real time—connected objects are immediately linked, in a ready-to-use state, to the company’s information system—which offers a host of new opportunities for companies, especially in terms of creating new services.
At the same time, since the product used to be delivered straight to the customer, the company was unable to exercise control, particularly regarding its use. With the Internet of Things, not only is the company able to maintain control, but most of all, it has the possibility of offering a service around the product. Sneaker retailers become sports advisors, and transport companies become mobility operators.
Under five billion connected objects were registered in 2010, while more than 80 billion are expected in 2020, less than four years from now! This new situation brought about by the Internet of Things affects all sectors of activity, but particularly product manufacturers. However, other sectors such as health, retail and industry (excluding production) should also benefit from this new dynamic. In this regard, agriculture is a symbolic sector, where the many innovations emerging at the moment will help provide businesses with intelligence and advice.
Integrating the Internet of Things into Information Systems to Create Value
Connecting the Internet of Things to a company’s information system is not just a connectivity issue. Most of all, it’s about establishing an all-encompassing environment for exploiting data from connected objects with the goal of achieving a competitive advantage. This integration of data from the Internet of Things actually presents a threefold challenge.
First, these new data sources need to be incorporated with the existing company data. We now see that the main weakness in this area is a lack of integration between the various applications of the Internet of Things. While the smartwatch and intelligent home markets are showing more modest growth than anticipated, it’s because they do not generate enough value for the consumer. This is explained by the lack of overlap between data generated by equipment and those already present in the company’s information system (CRM data for example).
There seems to be a plethora of opportunities. For example, Air France has stated that it managed to make significant gains in efficiency by choosing to use data from “only” 24,000 of the 300,000 sensors installed on most modern aircraft such as the Airbus A380. The airline has already seen significant benefits, both in terms of remedial and preventive maintenance. For example, the detection time for malfunctions has gone from five hours to five minutes. But we can only imagine the benefits they would enjoy if all of the sensor data were used.
GE Power (one of the pioneers of industrial data analysis) estimates that to date, they are only analyzing 2% of the data that they can recover from their turbines, which demonstrates how much potential remains untapped, even at the most advanced companies. Finally, going beyond the product-related information has, for example, allowed SNCF to accompany its OUIGO offer with an array of value-added services (for example, when a train is late, the taxi and the hotel are automatically notified).
Second, data from the Internet of Things should be connected to the company’s applications so that actions can be launched in real time. In the past, household water consumption was recorded by hand every three months; now with smart meters, consumption can be monitored in real time, allowing, for example, for the earlier detection of leaks, which represent 25% of total water consumption! The challenge of connecting these data with applications lies in creating value-added services: reporting leaks, optimizing performance or detecting blocked sensors, for example. Similarly, General Electric optimizes the management of its wind turbines by overlapping numerous data, including weather conditions. Unlike Air France, which operates using batch mode, data here are overlapped in real time and fed into a series of actions.
Finally, intelligence must be added by integrating the analytical dimension and machine learning into devices. Technologies such as Apache Spark are now making it possible to analyze and manage data in streaming mode, that is to say, in real time, in order to draw useful knowledge for companies. While m2ocity was born out of a platform dedicated to billing, it has now become a leading provider of value-added services, helping consumers conserve water and heat, providing them with useful advice and detecting malfunctions. The use and analysis of Big Data from the Internet of Things helps develop approaches that are both predictive and prescriptive.
Capitalizing on Experience and Preserving Data Ownership
The experiences of companies in the industrial maintenance field suggest dramatic development opportunities for other sectors. One example is the health sector. The overlapping of data from connected objects with patient record data should help anticipate potential problems. The connected pacemaker is a great example of the potential progress from which we will all benefit in the near future.
Now we have to respond immediately to data ownership-related issues. We have seen such agriculture giants as Monsanto and John Deere acquiring companies that specialize in Big Data. And farmers are beginning to understand the risks in dealing exclusively with these players: if they delegate the use of their data, they may lose control of their development. The problem is the same in the areas of aeronautics and health. Similar to the debates plaguing the professions of marketing and customer relations today, these sectors will not be able to launch a thorough discussion on the ownership of such data.