Digital transformation. It’s a modern business watchword (or two), promising to drive a massive array of efficiencies and innovation. Replacing manual processes with digital ones, we are told, is the secret to freeing up human resource to focus on creative or strategic tasks, reducing errors and inaccuracies, creating more unified processes and ultimately doing more with less. It is hardly surprising that businesses across a wide range of sectors are considering what their digital roadmap looks like.
However, investing in digital can be costly, complicated and time-consuming, particularly in sectors which have not traditionally focused on such technology. Paper-based and manual processes are still the norm in many aspects of modern business.
How can the Internet of Things (IoT) help?
It is easy to think of the IoT in terms of sensors placed throughout an environment – in terms of devices. There’s a reason why physical things like smart fridges and driverless cars are the aspects of the IoT that have caught the public’s imagination most dramatically. But in fact, the IoT is far more usefully thought about in terms of data.
An organisation which deploys IoT devices or sensors is, in effect, gathering information that previously went entirely untapped or which had to be collected manually (already at this stage, then, the IoT has enabled small-scale digital transformation). This data enables the organisation in question to establish the health of its equipment, where its vehicles are located, the conditions of its environment, how its processes are performing and so on.
What happens next, however, is crucial. That data on its own is not enough to drive digital transformation – but once analysed and harnessed, it can have a multitude of, well, transformative impacts.
Analysis, insight, action
First the collected information needs to be consolidated and analysed appropriately, generally using an IoT analytics platform or engine designed specifically for the purpose. Both short-term and long-term trends need to be established, as well the relationships between those trends and business processes. All this needs to be presented in clear visual formats.
Next, those insights need to be integrated with the operational systems that control business processes – from the dispatch system for a fleet of vehicles, to the control systems which manage the machinery on a factory floor, so that they can drive tangible actions. In many organisations, this integration requires Enterprise Resource Planning (ERP) software, in order to contextualise the data gathered by the IoT in terms of this particular business’s processes.
This, then, is the crux of how the IoT can accelerate digital transformation. Not only does it digitise the process of turning business intelligence in business action, but the intelligence and actions it can generate may have previously never been touched at all. IoT infrastructures draw new lines of connectivity not just between devices, but between operating and control systems, and sources of business knowledge – ultimately generating brand-new knowledge in the process.
And, given that knowledge should be the starting point of all business decisions and strategies, this means that the IoT can fundamentally shift the nature of work itself. Truly transformative!