Last year the website Tech.co produced a list of the five weirdest devices connected to the internet. There was a dog house that provided an environmentally balanced living space for Fido, a smart mattress cover to help you sleep better, and a connected refrigerator door tray so that you are never caught short of eggs at breakfast.
While these sorts of articles attract plenty of clicks, it’s the enterprise-level Internet of Things (IoT) that is really more interesting. For businesses the IoT is truly revolutionizing the way in which entire industries are managed, and this is no truer than in the utilities sector.
I’ve seen firsthand how the industrial IoT has revolutionized data gathering and information sharing between divisions in utilities. I’ve seen maintenance schedules improved and costs reduced as physical assets self-report on their status and malfunctioning equipment is identified early. It’s changed the way that utilities work, manage, and plan their operations, yet for all the advances that the industrial IoT has brought, it is not the panacea that utilities firms hoped they might be.
Clients and contacts in the utilities sector consistently report that while the industrial IoT is effective at avoiding catastrophic events and avoiding unnecessary downtime, the insights that the IoT provides for businesses are limited.
In most cases information coming industrial IoT systems is disconnected from the overall operational and business environment. Hence, despite the obvious interconnections between operations, business divisions, and even human resource divisions of a company, the industrial IoT networks report and are assessed in a closed system. What’s more, even where data is integrated and data is shared across a company, making strategic decisions based on that data without understanding the impact on risk – financial and otherwise – and operational KPIs is foolhardy.
Consider the following example.
An energy company has deployed their industrial IoT and their monitoring service detects a developing issue on one of their oil production platform’s equipment. That’s valuable information – but what do you do with it?
The decision that a company makes when oil is selling at $35 per barrel won’t be the same decision it makes when oil is selling at $120 per barrel. Whether the company’s production sharing agreement expires in 2 years or in 5 years will affect the decision, too, as will the location of the platform – the North Sea is not the same political, economic, and environmental context as the Middle East, after all.
Thinking more broadly, these sorts of decisions are faced by companies working in a variety of verticals. Energy networks and utilities, airports and transport operators, telecom networks and toll roads –any sector that has deployed an industrial IoT network will be generating useful data but often condemned to analyzing this data in isolated silos and leverage intuition to make the optimal strategic decisions.
While it is certainly more complex to analyze all of the information generated by the industrial IoT in the context of the whole company system there is significant research to suggest that this is the best way to reach an optimal decision. There is value in complexity and that value can be extracted and leveraged by companies willing to take their IoT networks to the next level and embrace complexity and interconnected insights it generates.