As we move into 2018, one particular trend will bear watching: how the proliferation of the Internet of Things (IoT) will drive digital transformation in this economy, particularly in the realm of automation.
The Core Nature of IoT
In a consumer context, you might be familiar with the core concept of Internet of Things, or connected devices. As its name suggests, it describes any electronic device that is connected to the internet or other, internal networks. That connection, in turn, leads to increased data interchanged that has immense potential. It’s why refrigerators can dynamically re-order food, and thermostats can be adjusted from your smartphone.
In many ways, Asia Pacific is a leader in the IoT space. Of the almost 30 billion devices connected globally today, almost 9 billion exist in the region (excluding Japan) alone. China, India, Korea, and Australia are especially large drivers in moving the technology towards the mainstream. Revenues connected with the IoT industry came close to reaching $600 billion during this past year, accounting for the largest market share of all major global economic regions.
IoT in an Industrial Context
Crucially, the above statistics are not limited to consumer use. While this is the most visible vertical of IoT, it’s not actually the most common. In fact, the majority of devices now exist in industrial and business environments, where they have begun to play a major part in the digital transformation process.
In fact, only 6 percent of IoT units and 12 percent of revenues actually come from consumer-driven products. The rest can be found in infrastructure, buildings, and even animals. The single largest share is enterprise, which accounts for 41 percent of all devices and 38 percent of revenues. That proliferation of IoT capabilities within an industrial and enterprise-level context will only become more important as we move into 2018.
That’s because capabilities are shifting. Technologies that used to only be available to major enterprises are becoming increasingly accessible to smaller businesses, as well. Applied correctly, IoT can help even small businesses gather better data, better understand their audience, improve the effectiveness and efficiency of their inventory and operations, and enhance remote work options.
In other words, is a concept with the potential to touch every aspect of businesses across industries. And we have only begun to scratch the surface of its potential.
Current and Future Applications of IoT
Some of the commercial applications related to IoT are relatively straightforward. For instance, businesses can install ‘smart’ trackers within their warehouses to track inventory, collect data, determine trends, and make dynamic adjustments as needed. In fact, as outlined by TechTarget earlier this year, the Internet of Things is already beginning to revolutionise the ways in which merchants and manufacturers track and optimise their inventory.
Other existing use cases are similar to consumer operations. For instance, smart thermostats in large offices and warehouse buildings can optimise the temperature for each scenario and communicate with smart light bulbs and window shades to minimise energy use. From small offices to large warehouses, IoT is beginning to open the door for increased energy efficiency and savings.
For the future, these potential applications will only become more widespread. In addition, it would not be a surprise to see the concept expand into new realms in 2018 and beyond.
Consider the still futuristic concept of self-driving vehicles. We’re getting closer to getting them to market on the open road. But in the meantime, the same general concept could be applied to any large organisation that requires transportation of items or people. Job automation will reach beyond the assembly line, and toward other jobs from mail delivery to business campus transportation.
Forbes.com has a number of other predictions related to the general concept as it applies to 2018. Especially interesting is a forecast of the ways it could affect data storage and analysis:
In 2018, we will see significant momentum among firms deploying business processes requiring local data analysis close to the connected devices that enable these processes. The edge IoT devices can act locally based on data they generate, as well as take advantage of the cloud for security, scalability, configuration, deployment, and management.
Will that come true in the coming year? We don’t yet know. But we do know that future applications of this concept are almost limitless, and many of them result in a key benefit: automation.
How IoT drives Automation and Digital Transformation
Home automation is the most natural application of the concept and in many ways it’s most advanced. Through a variety of sensors and communicating devices, your home is already able to detect threats, optimise temperatures, and much more. Strictly, that process is not necessarily applicable directly to a business concept. It does, however, inform the ways in which IoT can drive automation both now and in the near future.
Think about the traditional process of data-driven decision making. Data is collected, then has to be manually analysed while keeping all variables in mind. It is then compared to a benchmark that determines standardisation and used to make a decision. Manually, this process is exceedingly complex to the point where it’s not always feasible for businesses. Especially smaller organisations simply don’t have the time for this extensive collection and analysis process.
Now, compare that with a fully optimised process in which the collection and analysis are automated. Connected devices can collect relevant data that ranges from inventory to supply chain processes, and share it with each other in real time. A deep learning algorithm then takes that data, runs it against the variables typically affecting output, and provides either automated adjustments or recommendations to keep daily processes optimised and make improvements as needed.
Just a few years ago, that process may have seemed like science fiction for budgets that didn’t go into eight or nine digits. But, as home automation shows in a consumer context, it is becoming increasingly realistic. That’s why one of our most direct predictions for 2018 is simple: IoT will become the status quo for Asia Pacific businesses looking to optimise and automate their processes. Taking a hint from home automation, we moving fast to make this futuristic scenario a reality.
Is Your Organisation Ready for the IoT Proliferation?
In short, IoT has the potential to be a game changer. In fact, in many enterprise contexts, it already is. If any device can be connected and collect data, that data can be used for more automated processes that transform the way businesses are done across industries.
As revenue grows, the technology will become more accessible to organisations of all sizes. At the same time, even in that context, your business needs the right infrastructure to optimise your operations for this technology. Are you ready for that shift?
You might need to overhaul your entire infrastructure, or simply make a few adjustments. Either way, it makes sense to build a relationship with experts who know the Asia Pacific region as well as they know the concept and applications of the digital transformation.
You can start by downloading our guide on Digital Transformation here: