What will it take to realize the promise of IoT
2 October 2015
IoT Why now? What's new? : Did you know the term "Internet of Things" (IoT) was coined way back in 1999? Some of the key elements of IoT have been around for a pretty long time. Oil fields, for instance, have had 1000s of sensors for quite some time. SCADA systems have been around since the 1960s. What's new is the ability to connect billions of sensors/devices to the Internet. What's new, is the ability to analyze petabytes of data streaming in from these devices, and then to drive decisions. Also what's new, is that devices have become a lot smarter with better processing capability and lower cost. The convergence of these developments has created a powerful mix. So much so, that IoT is expected to drive the next Industrial Revolution - Industry 4.0. The convergence has also created a powerful set of expectations. So much so, that IoT sits right on top of Gartner's Hype Cycle.
Is it overhyped?
Our take can be summarized as follows --
- Near term value: Over the next 3-5 years, IoT will definitely transform certain processes across some industries / environments
- Inhibitors: However, significant hurdles will have to be overcome, to quickly cross the "Trough of Disillusionment", and realize the full potential
- Monetization: A lot of value will come from integration, and novel business models will be needed to share this value equitably amongst the participants
Let us elaborate.
Near term value
IoT indeed is for everyone. It is useful to think of a maturity model for IoT. Wherever you may be on this model, chances are there is some implementation / upgrade that will be appropriate for you in the near future.
Maturity of IoT adoption and the ability to move to next level will govern the near term value created. E.g. monitoring phase is mature in process and manufacturing industry, and the near term value for them is how quickly they can climb to â€˜Predictâ€™ and â€˜Optimizeâ€™ levels.
The macro-economic environment also has a direct impact on the value delivered. For instance, in developing economies, implementing a simple monitoring solution (e.g. monitoring water transportation from reservoir to tap) can give huge benefits and value, as compared to same in developed economies. At the same time developed economies can harvest value by implementing predict / optimize solution for their existing monitoring solution.
Hurdles around sensor / device costs, system security, and organizational structures, while non-trivial, will get addressed sooner - driven by the economics of IoT. Hurdles around data ownership, interoperability and infrastructure will be more complicated to overcome, and could hold back IoT from delivering its promise fully.
- Data ownership and privacy: These topics have been debated in the context of social media - does the data belong to the user, or to the platform provider, how much can be shared, with whom etc. Fresh debates will arise in the wider context of IoT, when an enterprise gets connected with its suppliers and customers more seamlessly. These debates may have to be resolved case-by-case, and hence may take a while to settle down.
- Interoperability: The current phase of "creative chaos" will lead to robust and scalable solutions in the long run. In the short run however, the explosion of point solutions and even of platforms, can lead to severe interoperability challenges. While industry consortia like the AllSeen Alliance are working on evolving common standards, the challenge is unlikely to get resolved in the short run.
- Infrastructure: Many use cases require a level of infrastructure that does not yet exist in developing economies. The "digital divide" has reduced but is far from gone. There are regions that still don't have electricity. Internet penetration rates in Asia and Africa are still less than 40%. Where access exists, speed and reliability is often lacking. It is no wonder then, that as per OECD's 2015 report, variation in the number of online devices per capita is not a few percentage points, but is in the range of 3x - 5x!
In the next part, we will continue the discussion, starting with monetization...
We're eager to hear from you. Let us know your point of view.
Redefining "responsive" through real-time engagement tracking
12 September 2015
We are very excited about how advancements in technology can take customer experience to the next level. Here is our take on what can - and will - be done in the next couple of years.
Businesses are constantly thinking of ways to provide a better experience to their customers. The broader goal of course is to engage customers - and keep them engaged. In a macro sense, engagement means stickiness, loyalty and advocacy - which translate into repeat business and even referrals. In a micro sense, engagement is about starting a conversation with the customer, listening deeply to the verbal as well as non-verbal responses, and drawing the right insights into what the real needs and wants are. Chinese gem traders were known to be sensitive even to buyers' pupil dilations!
In the digital world however, while the "transaction" part of many processes has been automated, the "relationship" part is often diluted. A case in point is the common frustration with never-ending IVR menus - while the caller would be so much more comfortable talking to a real person. Similarly, digital strategists must bear in mind that in the consumer space, shopping is not just a commercial process but equally a social experience. Breakthroughs in emotion detection technologies are now letting us correct this irony to an extent. Just like we can read body language, these technologies allow software to now understand whether the customer is happy, confused, interested and so on. Consider how such advances can enhance responsiveness in virtual (online) interactions as well as in real ones --
- Education: If a student in an online course is confused, the software can step back and spend more time on elementary concepts. If a student is tired, it could announce a break. If bored, it could take a real problem rather than continue with dry theory. Brick-and-mortar schools could also use such technologies to gauge the overall engagement level of a class.
- Corporate: Decades ago, time and motion studies started helping predict and improve productivity in manufacturing industries. More recently, special software products are letting enterprises understand how their employees are spending time in knowledge industries. However, this is of limited use, since a couple of hours of "being in the zone" produce more than 8 hours of disengaged work. So it would be much more useful to use technology that tracks engagement.
- Shopping: It is well known that online advertising hooks into browsing behaviour, particularly on e-commerce sites. However, such advertising can be targeted even better, by distinguishing between casual online window shopping, and serious pre-shopping analysis. Going ahead, it might even be possible to adjust promotions accordingly - a la Chinese traders!
- Wellness: Awareness is usually the first and often the most difficult step in stress and anger management. What if our smart-phone becomes a silent observer who gently nudges us when we're starting to stress. Similarly it can highlight chronic boredom, which is often a precursor of depression.
We at Pratiti are excited about these new possibilities to humanize technology
, and thus take engagement and experience to the next level. Let us know what you think.
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