IoT and The Business Impacts

IOT and The Business Impacts

Ashiq k

Introduction

The idea of?Internet of Things (IoT) has been around for several years now. But still industry - incumbents and startup - searches for applications and appropriate business models.

This Document introduces the most important concepts of the internet of things and various mechanisms that make IoT useful. Throughout the Document, Readers will get to know useful tools and schemas that facilitate transfer to own business context and challenges.

This Document is for you, if you are enthusiastic about digital transformation and internet of things, but still need to figure out how to translate these ideas to your business context, your strategy and into sustainable business models.

What is IOT ?

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The basic idea of IOT is that virtually every physical thing in this world can also become a computer that is connected to the Internet (ITU, 2005). To be more accurate, things do not turn into computers, but they can feature tiny computers. When they do so, they are often called smart things, because they can act smarter than things that have not been tagged.

The IOT-idea is not new.However, it only recently became relevant to the practical world, mainly because of the progress made in hardware development in the last decade. The decline of size, cost and energy consumption, hardware dimensions that are closely linked to each other,now allows the manufacturing of extremely small and inexpensive low-end computers.

IOT-standards?

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One global one-size-fits-all? Unlike in the Internet, there is currently no single global set of standards for the IOT, and in all likelihood, there never will be. The most important reason is that the IOT leaves the clean, closed, logically consistent and self-sufficient digital world. IOT projects suddenly have to deal with physical properties such as distance (should a tag ideally be readable within a few hundred meters, a few meters, or a few millimeters?) and characteristics of neighborhoods (e.g., materials that absorb or reflect radio waves).4 . These properties depend on concrete applications, and these applications are almost as manifold as the physical world itself, resulting in a rich variety of technological forms of appearances.

IoT Market Segments

The vision that virtually every physical object can become a part of the internet impacts many industries already today.When we search the internet for “IoT market segments” we find countless graphics and pictures that aim at structuring market segments and IoT applications.The first example from Machina Research illustrates that many segments overlap with each other in one or more applications. Like “Connected Car” and “Connected Industry” which share topics like “Emergency Services” or “Road Fleet Management”, e. g. a logistics company managing a fleet of trucks.

Another example adds the aspect to distinguish the two customer types “Consumer-facing” – “IoT2C” or “B2C” – and “Business-facing” – “IoT2B” or just “B2B”.??

Example IoT Applications

Looking at some more examples can help us understand the power of “virtually every physical object becoming connected to the internet”

Smart Home – Smart Fridge

?Smart Fridges are amongst the most cited IoT applications. Many very different ideas exist, how to make a fridge smart. Adding screens to the front door which allow internet browsing – for recipes; adding RFID or similar readers, which detect the content of the fridge and automatically?order new coke when there are only two left; or adding cameras to the inside, so that one can check what′s in the fridge?from anywhere?in the?world.

As you might have noticed, I am personally not 100% convinced that smart fridges will be the IoT “killer app”.

Others play jokes on smart fridges, too,

Smart Cow – IoT in agriculture

This example shows that expertise in many different disciplines is required to find useful IoT applications. The farmer or veterinarian having the knowledge about indicators for calving – here the specific temperature rise – might not be an expert in sensor technology or data transmission technology. The technical expert lacks the knowledge of the farmer’s needs and the mentioned temperature patterns.

Industry 4.0

Industry 4.0 or Industrial Internet refers to the idea to apply IoT in manufacturing, mainly.Industry 4.0 refers to the 4th industrial revolution following the first to third industrial revolution which are depicted in the overview chart.

Smart Home?

An IoT solution is a complete system that addresses all levels of the IoT value stack, like the example Smart Home does.

IoT Components

The below figure shows the IoT components a physical thing which we need to connect with internet it could be any thing here for an example we are taking Bulb,The second one is the sensor for sensing here it could be a motion sensor if any movement happens the bulb would glow and then needs a connectivity for transmitting the bulb data and then analyse and publishing the data in an APP or website.

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Business Models

The term “business model” is used frequently in business life. This is due to the fact that more and more people understand that an innovative business model can create a competitive advantage. Like product innovation and process innovation, business model innovation (BMI) provides additional opportunities for companies to differentiate from their competitors.?

The Business Model Navigator comprising the triangle and the business model patterns is a powerful tool for business model innovation and subsequently for understanding the impact of the internet of things on business models.?

IoT Business Mechanisms

The most important result from the research?is?six mechanisms through which IoT fosters business model patterns. Those mechanisms are listed below?“Business Model Patterns and IoT”. They are a great asset when it comes to ideating IoT business models.

IoT Business Model Builder

The IoT Business Model Builder is based on ideas of Design Thinking and comprises elements of classic project management, too. It combines various tools to address questions of the type: “What could we do, if we connected product XYZ? And how would a suitable business model look like?

An overview of the IoT Business Model Builder is given in the following figure. On the left side a more generic overview is provided, whereas on the right side the ten process steps are listed.

Apply IoT within your business

we look at opportunities to leverage IoT from a business′ perspective. Depending on whether we look at an IoT solution or at components for IoT different basic opportunities exist.?

IoT Solutions and Components

As depicted in the figure below an IoT solution comprises all levels of the IoT value stack. For example a remote temperature monitoring system with a sensor hardware, connectivity over cell network, a backend and an app as a user frontend would be an IoT solution. Whereas an electronic device capable of measuring temperature – a temperature sensor element – would be a component which is necessary to build such a solution.???

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IoT Business Opportunities

It is important to note that the three opportunities – see the figure below.Depending on a company’s business and strategy it might apply one, two or even all three opportunities. At the same time the various opportunities should not be mixed up, as they require very different strategies and approaches.??

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?Cost Reduction

Most probably Internet of Things will have the largest business impact when solutions are being applied in order to optimize processes and reduce cost. These opportunities are expected to exist in all industries and business sectors.???

Approaches to Cost Reduction and Optimization

The following figure shows a collection of generic approaches to cost reduction from today′s perspective. The collection deliberately does not have an order or ranking, but “Condition Monitoring” and related ideas, as well as “Supply Chain Optimization” – including for example replenishment services and goods tracking – are very popular and adopted frequently.

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Conclusion

This Article is written with lots of references. hope this helps few of you thanks for reading.

Ashiq k

Hardware Design Engineer

IoT Enthusiast