5 good reasons for IoT
- On 1. December 2020
The Internet of Things (IoT) is now also gaining ground among medium-sized companies and is ready for implementation scenarios. Although the term “Internet of Things” may have a certain abstractness, there are many innovative ideas in the field of IoT. The “Internet of Things” is changing private lives through many smart products and apps, but above all it offers new possibilities and opportunities both for individual companies and for a networked and collaborative (manufacturing) industry.
Data and facts
According to an IDG study from 2019, IoT has even arrived in many companies. According to the study, the number of companies that have implemented IoT projects has risen sharply (44 percent) and more than doubled compared to last year (21 percent). With the introduction of the 5G mobile phone standard, the possibilities for successful IoT implementation will also increase. According to Bitkom, the revenue potential in the IoT market is estimated at 250 billion euros in 2020. Last year, for example, the large German software group and IoT trendsetter SAP announced its intention to invest two billion euros in the Internet of Things by 2020: a market worth billions is emerging. So there are plenty of reasons for companies to take prompt action to implement a sustainable IoT implementation strategy.
Good reasons for implementing IoT solutions
New business models, new products, new customers
Companies can use IoT to develop completely new, digitized products, digital services and business models, such as digital product and service platforms or platform models that enable companies such as brokers to mediate between suppliers and customers. The 5G mobile technology will also accelerate the further penetration of IoT systems and platforms. A fine example of a digital, networked IoT product is the so-called “Connected Car”, in which networked applications, e-mobility and autonomous driving are uniquely combined. According to the authors of the IDG study on IoT mentioned above, satisfied customers, higher customer satisfaction in general and the development of new customer potential through a more direct customer approach are also among the main reasons for implementing IoT. IoT also paves the way to new customers as a basis for new payment models. This generates new business and growth.
Co-innovations through networking
When building the above mentioned platforms into customer-specific IoT system solutions or platforms, a win-win situation is created where companies work together in a networked, cross-organizational manner and co-innovate. Examples of the technological and economic potential of IoT systems and platforms are automated production with Industry 4.0, AI, digital twin, robotics and human-machine interaction. In practice, the claim and reality are currently still a long way apart. But apart from technical aspects, IoT is above all a cultural issue – co-innovation and networking often shake the classical self-image of many small and medium-sized companies. But without the openness to work together across company boundaries in the future, many SMEs will miss the leap into the digital age completely.
In addition to the establishment of new business and platform models, the topic of increasing efficiency is at the top of the IoT motivation scale. This includes both higher efficiency in existing business processes and a general cost reduction through the use of IoT. In this context, efficiency also means energy efficiency. For Europe’s “Green Deal”, IoT is thus becoming a decisive building block for the “zero emission economy” of the 21st century.
Increase in productivity
According to an SAP study, production and thus the topic “Industry 4.0” are always
in the focus of all incentives for possible IoT scenarios. Increasing productivity, shortening makeready times, reducing energy costs, using predictive maintenance to increase machine uptime and, on top of that, producing more cost-effectively are the key IoT factors. New sensors, new machines and standardized interfaces such as Umati (Universal Machine Technology Interface) based on the platform-independent OPC UA standard are among the things that will make this possible. In combination with the topic of energy efficiency, IoT solutions will also make an important contribution to competitive industrial production in Europe.
The power of data
A paper by the management consultancy Deloitte talks about data analytics: IoT provides a very precise picture of the current situation in terms of data. Algorithms, big-data applications and artificial intelligence recognize certain patterns in this information about the actual state. In this way, they obtain forecasts of expected conditions and trends in the future. According to Deloitte, data analytics uses hypothesis-driven models to gain insights from this information. In other words, business activities generate the data which, through analysis, leads to action-relevant insights, new decisions and finally to new business activities and models.
In this way, data becomes the core of new, digital business models. Especially medium-sized companies with long-standing relationships can deliver real added value for their customers – provided they start to leverage the potential of their data.
If you don’t want to miss the boat – also and especially in the wake of the Corona crisis and the enormous upsurge in digitization in this context – you’d better start thinking about the possibilities of the Internet of Things today than tomorrow. We can help you with this and are a reliable partner when it comes to finding suitable solutions and the right partners in the implementation process. No matter whether you are a large company or an SME, and regardless of how far you have progressed in the digitization process. Please feel free to contact us.
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