Unless the goals of an IoT initiative are clearly defined, success is impossible to measure—and could be quite different in the eyes of the various stakeholders.
Getting to that clear definition and finding the right partners for an IoT initiative are crucial. At Oracle OpenWorld, IoT experts from supply chain consulting firm Inspirage LLC, enterprise IoT company relayr, and Oracle talked to a packed room about four of the questions they are frequently asked regarding IoT—a few of which reveal how companies often doom their IoT projects from the start.
1. “Where Do I Start?”
The first step is to define the business outcome you want to achieve with IoT, which will provide a clear focus and measurable objectives for the project, said Jai Suri, senior director of product management at Oracle.
“What is your business objective?” he said. “You have to have a clear idea of how you want this technology to help you. Are you trying to increase productivity or revenue? Is it part of a larger digital transformation initiative? What are the KPIs? If you don’t understand what KPIs you want to achieve with IoT, you will eventually fail. Thinking about this up front is .”
One example: How much does equipment maintenance downtime cost your company—and how much could be saved if that downtime could be substantially reduced through predictive maintenance?
But IoT can do more than improve current operations; increasingly, it is being used to create new revenue streams.
Guneet Bedi, vice president and general manager-Americas of relayr, described how a company that sold high-end coffee machines to businesses used IoT to create a new business model that enabled smaller companies that couldn’t afford such an expensive appliance to instead pay based on utilization of that machine.
“That company is going to make $2 to 3 million in additional revenue each year, which can quickly pay off the technology investment,” he said.
2. “Isn’t IoT Just About Connecting Devices to the Cloud?”
Think beyond devices and connectivity: it’s about the potential of business outcomes. “It’s not just about which devices you can connect to the cloud, but how can you use the data coming in from those devices to automate certain business workflows,” Suri said.
Critical to improving business workflows with IoT technology is the integration of technologies across business processes so that various areas—such as supply chain, enterprise resource planning, sales, and customer service systems—can interact seamlessly and in real time. These digital threads, tying together previously disparate components, can create provide greater visibility and enable KPIs that involve multiple areas, such as improving customer satisfaction.
“On a shop floor, when you move materials from point A to point B, there is always some latency between the time when that material is physically moved to when that move is recorded in the system,” said Navneet Goel, managing partner and executive vice president at Inspirage. “It could be the end of a shift or the end of a workday, or perhaps those inputs take place every few hours. But if that information is recorded in real time, think of what that means in terms of visibility, labor, and the other systems that use the information.”
Companies can also create digital twins of a physical asset (such as a machine on the factory floor in another country) to quickly detect and address issues remotely. IoT sensors on those machines provide real-time data, and adjustments and repairs can be made remotely. Gartner lists digital twins as one of the ten top strategic technology trends of 2017, predicting that they will be used by organizations to proactively repair and plan for equipment service, plan manufacturing processes, operate factories, predict equipment failure, increase operational efficiency, and perform enhanced product development.
3. “Do You Support IoT Protocol X?”
While this is a valid question, it shouldn’t be one of the top concerns when launching an IoT project or initiative.
“Don’t hyperventilate on protocol,” said Bedi. “Hyperventilate on the use case and getting the right kind of data.”
Among the issues that can dictate the protocol are the age of the device, its power source, network and data protocols, the frequency of communication with the device, and even whether a device will connect directly to the cloud or through another device because it’s not economical to have an internet connection to each device.
There is no standard IoT protocol, and that’s not going to change anytime soon, Suri said. But a key aspect of IoT device protocol is security—and security concerns are one of the top challenges to building support for IoT initiatives in enterprises, according to IDC.
4. “Why Can’t We Build Our Own IoT Solution?”
Security should also be a big red flag for any company considering building an IoT solution in-house. From the endpoint devices to the network to applications, the potential for security vulnerabilities are concerning and will continue as systems are updated and patched. If needed patches are skipped, the risk is even higher.
Another risk of DIY: As a company expands to new regions, communication frequencies and regulations change—and will continue to evolve.
“IoT is a rapidly evolving technology landscape,” Oracle’s Suri said. “You want to be sure that what you invest in today will work tomorrow, so it’s important to future-proof when you buy technology.”
And while a company can buy devices, connect them, and capture the data, how they take that data and use it in their business, as well as how they automate as much of this flow as possible, will be critical for gleaning value.
“IoT is not a single-vendor play,” Suri said. “You need a lead vendor who can bring together everyone else required to create a holistic solution. There are so many different industries, so many different use cases; a vendor with a large ecosystem of partners is an advantage.”
Margaret Harrist is director of content strategy and implementation at Oracle.