In a 2015 survey conducted by Gartner, only 29% of respondents were using IoT–but Gartner predicted that by the start of 2017, 43% of all companies would have some kind of IoT implementation.
Among the most common IoT implementation projects were data center monitoring and automation, supply chain and inventory management, facility management, personalized advertising, asset management, security monitoring and surveillance, and patient monitoring. But beyond this range of IoT projects, a majority of companies still had either formative plans or no plans to implement IoT.
With all of the hype about IoT, why are some organizations moving slowly?
Some companies simply don’t see a need for IoT in their operations; others are concerned about the changes that the technology might create in business processes that have worked relatively well–processes everyone understands. In other cases, companies feel that they simply don’t have the bandwidth or the expertise to address IoT or that investing in IoT would create a budgetary strain.
The bottom line here is that many companies still need to be convinced of IoT’s benefits. For IoT promoters, then, the task is to show how IoT really helps companies and just what the payoff is.
Here are five real-world examples of beneficial IoT at work.
1: The food cold chain
“For years the [food and grocery] industry has done track and trace, but the problem was that the information wasn’t necessarily visible to all parties,” said Frederick Wu, president and founder of Deltatrak, which provides IoT cold chain solutions. “Without this visibility, it is difficult to track so you can prevent something from happening, and this costs companies money. If a customer returns a head of lettuce to a retailer because it spoils, it is possible that its shelf life was reduced because it wasn’t property refrigerated at some point along the supply chain–but you have to know where the problem occurred if you’re going to take meaningful steps to avoid waste in the future.” Wu and others maintain that they’re getting less goods spoilage and greater profit margins because of IoT’s ability to monitor perishable goods.
2: Fleet tracking
Logistics companies can now plan best routes for drivers, monitor in real time the location of any vehicle, redeploy trucks on alternate routes when changes in transportation plans occur, and even monitor truck braking, engine performance, etc., to assess whether drivers are driving safely and fuel consciously.
All this data is collected by IoT sensors that automatically transmit back to headquarters. This saves drivers from making out logging reports and also gives a single “pane of glass” view of all logistics routes to managers at HQ at a given point in time. The practice has reduced carbon footprints for transportation companies in their sustainability practices, which many of their customers demand to see as part of the vendor evaluation process.
IoT has improved driver monitoring and on-time deliveries, as well. On the bottom line, IoT has reduced fuel consumption and given food and transportation companies a competitive advantage–key factors, since fuel can account for 10% of the total cost of a consumer product.
3: Tram tracking
In Melbourne, Australia, Yarra tram operators monitor 250 kilometers of double tracks and equipment on trams to detect when rails and/or tram components are beginning to fail. When they detect potential issues, they send out crews to perform preventive maintenance to keep the trams running without interruptions to customers. Should there be an interruption in service, the system also auto-issues warnings and recommendations for alternate routes to the mobile devices of commuters. The practices build customer satisfaction and keep the trams running. “Tram punctuality and service delivery are always a priority at Yarra Trams,” said Neil Roberts, director of ICT at Yarra Trams. “Access to this important information enables operations teams to ensure our fleet regularly exceeds punctuality and service delivery goals.”
4: Remote site surveys
Often faced with dangerous and inaccessible locations they must explore and evaluate, mining companies have begun relying on IoT-equipped drones to survey these difficult-to-access areas. This eliminates the expense and the risk of sending out an on-the-ground team of human surveyors. Data gets reported, consolidated, and analyzed sooner, and surveyor field hours are conserved. Together, these savings contribute to leaner operations and faster times to actionable data.
Fertilizer is a major cost factor for farmers, concerning them almost as much as the weather. Now, fertilizer spreaders equipped with IoT can use software when spreading a field. This IoT-GIS (geographic information system) technology auto-detects when soil types or other natural outcroppings within each field require different fertilizer mixes for optimal crop yield. The spreader takes this information and makes an automatic adjustment to the mix. “In eastern North Carolina, the fields tend to be poorly drained, so there are many open surface ditches to facilitate drainage and the fields tend to be long and narrow,” said Carl Crozier, professor of Crop and Soil Science and extension specialist at NCSU. “Consequently, when planning out a grid for fertilization, these ditches have to be planned for as the fertilization driving pattern is mapped out.”
Takeaways for businesses
How can companies on the IoT sidelines learn from these use case successes?
- All projects started with a purposeful business case aimed at solving a specific problem that had been elusive in the past. These were not just proof-of-concept projects that were conducted to see if IoT worked.
- These IoT projects contributed directly to the corporate bottom line. They demonstrated revenue gain expansion and/or they reduced operating costs. In either case, profit margins benefitted.
- Most companies got expertise from their IoT vendors in their first implementations because they didn’t have the IoT expertise in-house.
- A viable approach to companies contemplating their first IOT adoption is to examine use cases that have proven out for other companies. The object is to adopt best practices demonstrated by those that have already been successful with IoT.
- Non-adopting companies of IoT need to understand the potential risks of waiting on the sidelines too long.
- By 2020, Gartner predicts that more than half of major new business processes and systems will incorporate IoT elements.
- Companies that fail to implement IoT could find themselves at a competitive disadvantage that outweighs the risk of foraying into IoT.