The Internet is all about making connections, and we’re not far off from making a heck of a lot more.
Cisco estimates that by 2020, the Internet of Things (IoT) will connect 50 billion devices—everything from phones and thermostats to medical equipment, forklifts, traffic lights and even our clothing.
The challenge is to know which dark assets (unconnected things) to light up (connect) and then capture, analyze, and use the data generated to improve efficiency while working smarter.
And industries are already seeing the benefits. In 2013, the manufacturing sector captured $103 billion of value.
Manufacturers have built smart factories that can adjust output based on real-time data. They’ve also implemented machine-to-machine connections that share data on shipments and inventory to streamline supply chains.
The great value of lighting up dark assets is hard to ignore. That’s why more sectors are scrambling to capture value by connecting more and more things. The key to success, however, is not just connecting as many dark assets as possible. It is about determining which things will add value by analyzing the data it creates, changing existing processes, and ultimately, improving the way people work.
“In the future, it’s pretty easy to envision the day where almost every single product manufactured will have an IP address, connect to the Internet, and have both hardware and software embedded,” says Matt Littlefield, president and principal analyst at LNS Research.
The rewards for all these connections so can be huge: The linking of dark assets over the next decade will generate billions of gigabytes of usable data and will create an estimated $19 trillion in IoT value. This growth will be partially fueled by new data coming online, that businesses can tap into in order to create more refined and efficient processes.
Coaxing Dark Assets Into the Spotlight
It’s crucial for both IT and business leaders to view the organization beyond its simple technology connections.
“Neither hardware nor software infrastructures are the real hurdles,” says Victor Mayer-Schönberger, a professor of Internet governance and regulation at the Oxford Internet Institute at Oxford University and the author of Big Data: A Revolution That Will Transform How We Live, Work, and Think (2013). “Rather it’s achieving a ‘data mind-set,’ one that gets company leadership thinking of the firm’s raw data as an untapped treasure. Without that mind-set, infrastructure is irrelevant.”
So how can your business benefit from the Internet of Everything? To start, identify unconnected assets that can deliver data, that when analyzed, can improve processes and the way people work.
“You’ve got so many resources out there: open-source data, social media data that can be mined for customer sentiment, government-supplied data—and that’s just for starters,” says Carla Gentry, a leading data scientist and founder of Analytical Solution.
“Finding and cataloging [data] is a first important step—most organizations don’t even know what they have, since different units have kept their data out of sight from the rest of the groups,” adds Mayer-Schönberger. (See “Three Tips for Tapping into Dark Assets.”)
Forging Meaningful Data Connections
Once you have a handle on your organization’s visible data sets, and once you know how to light up corners of your business, it’s time to lay some groundwork.
A successful IoT environment will include a standardized IP-centric network. This network allows all the connected devices within an organization to communicate with enterprise business systems. That standard network can also facilitate better collaboration among supply chains and customers.
New software systems must collect and translate information from connected devices into easily managed formats. The analytic tools must be able to tap into real-time data streams; the resulting analyses can potentially deliver multibillion-dollar improvements in efficiency.
Don’t Stumble on SecurityAnd you can’t skimp on security – it must be a top priority. You should build safeguards into any IoE solution, including security procedures such as hardware encryption, physical security and network security for all the data in transit. An end-to-end network is also critical in creating a secure environment.
“Businesses must be accountable for their use of personal data, and that requires appropriate risk assessment and mitigation,” says Mayer-Schönberger.
Security and privacy are sure to become burning issues as businesses collect more data from their customers and employees. Manufacturers, retailers and marketers likely agree that having more customer data is inherently better than having less. But some of their customers and employees may not be so sure.
For example, hotel minibars with built-in sensors don’t even let guests examine the peanuts without charging them. And warehouse workers wearing GPS wristbands can be called out for moving too slowly. Clothing that reports vital signs to doctors and health-insurance carriers may lead to higher premiums.
“Data mining is getting a bad name, since people sometimes perceive it as trying to drill into their private lives,” says Gentry. “Every bit of that information that businesses collect will be used either for us or against us. It’s going to be an interesting five years in Congress,” she adds, noting that any proposed legislation to control the collection and flow of data among billions of new Internet-connected devices will surely start long and loud debates.
The trade-off between privacy and efficiency may take time to balance.
Still, with billions of dollars of value waiting to be unlocked, it’s time to look deep into your organization, find your own dark assets, and light them up with the help of the IoE. Our data-driven future simply demands it.
Three Steps for Tapping into Dark AssetsHow to start looking for and connecting new sources of data that can lead to improved efficiency:
1. Brainstorm. Call a management meeting including finance and HR, and talk about how you work. In a manufacturing business, ask if every part of the operation—from the pallets of raw materials to the delivery trucks—has been sensor-equipped. In a service business, ask how can you monitor employees’ work in new ways—from turnstiles to telephones—to look for patterns that can be improved?
2. Outline. Get specific with the help of your IT team and/or outside experts who know how to deploy the hardware and software you’ll need to “light up” your operation.
3. Analyze. Call in a data scientist to help you understand how you can turn reams of raw data into actionable insights and conclusions. “Remember,” says Viktor Mayer-Schönberger, “This kind of data analysis is a main-line business function. It must be embedded into the general product and revenue-generating units of the organization. Only then will it actually be taken seriously and possibly flourish.”