Internet of Things is an increasingly important component in digital transformation. This is the first blog in a series about IoT, covering the possibilities of IoT and concrete tips on how to succeed
When you do a search on "Internet of Things", you get a number of more or less technical definitions.
I think IoT can be seen as the integration of physical objects, sensors and machines (things) with the global telecommunications network, where the things become visible in, and interact with the digital or "virtual" environment. It gives us a completely new level of interactivity with our physical environment, as consumers and in industry and society. This can give us better and more efficient healthcare services, a faster and more efficient transformation towards a sustainable society and provide new revenue streams for businesses.
IoT has reached an inflection point where it goes from being used in islands of "application silos" and in early niche markets, to becoming an ubiquitous enabler in an exponentially growing wave of new products and services in our private and professional lives. According to Ericsson, connected things will have an average annual growth of 18% in the coming years – i.e. more than a doubling in five years (source: IoT connections forecast – Mobility Report 2022). I strongly suspect this is on the low side, as we will see accelerated technological consolidation and streamlining, new networking effects and lower costs based on higher volumes, in a virtuous cycle.
IoT is an important part of a wave of disruptive technologies that are now standard components in a new IT landscape, and where we at Tietoevry are also very involved: Artificial Intelligence, Machine Learning and distributed cloud computing are probably the most relevant in an IoT context . We can already see dramatic changes of entire sectors, such as in the automotive and transport industries, driven by new players such as Tesla (based on a a potent mix of cellular IoT, cloud-native technologies, machine learning and Li-Io batteries). This in turn drives new efficiencies - according to Bloomberg NEF, Li-Io batteries for vehicles cost a fifth today compared to 2013 and despite a rebound in 2021, they expect continued yearly price drops of approx. 10% in the coming years.
New ecosystems, business models and application areas are emerging in a "Schumpeter's Gale" of creative destruction.
Here are some thoughts on how to strategize, deploy and operate IoT-based services as part of a digital transformation of enterprises and public sector:
Technology-wise, we need to ensure massive scalability in all dimensions, "end-to-end" security and privacy management as well as integration and interoperability and not least the reuse of common assets across different applications. Real-time information about the physical environment will become an even more high-value asset. Equally important is management of computing capacity; the algorithmic intelligence and thus decision-making (automated or with a human involved) will be distributed in much more fine-grained and dynamic ways.
Business-wise, strategically, operationally and tactically, we are all navigating a new competitive landscape, with new eco-systems and business models (such as products delivered as subscription services). Creating useful information and new knowledge from the new data streams as well as building the capabilities to rapidly act on this, becomes a critical success factor. Partnerships, co-creation and management of new ecosystems become even more important as strategic tools.
While the underlying drivers of digital transformation are technology-based, we must prioritize the human and societal aspects in order to get the successful results we want and to avoid negative consequences in the short and long term. From a human and organizational perspective, we need to be agile, ensure that the right competencies are available and that applications and their interfaces are truly usable and useful. Meeting legal and ethical requirements for personal integrity and security is of course paramount. If we do not fully incorporate the human dimensions from the start, we will miss new opportunities, fail in our investments and risk backlash in media and society.
The pace of IoT and digital transformation is happening at varying speed in different industries and consumer segments, but I am convinced that in a few years’ time we will look back and be amazed of the massive changes we will have experienced in our professional and personal lives.
Tietoevry Create are experts in planning, building solutions and implementing digital transformation, with deep expertise in both the latest mobile technology and IoT, and in all IT-related aspects of both private and public business. Our strong and unique position both in the Nordics and internationally enables our customers to realize improved and completely new valuable services and process improvements. We are well prepared to help our customers succeed with IoT as an integral part of current and future activities!
Do you want to know more about how IoT can enable your digital transformation?
Don't hesitate to reach out to me!
Michael has worked with telecommunications and IoT for many years and has extensive experience of how customers can use IoT to create value & accelerate the digital transformation in both industry and public sector. He is deeply engaged in new IoT-related tools, such as advanced 5G services, Private Networks, AI/MA and edge computing, etc. Michael has also worked extensively with IoT for utilities and Smart Cities. He has a deep interest in the digital transformation of the energy and public sectors as a key enabler for a sustainable future