IOT: I see fields of green, red peppers too

Hymie Marnewick, CCO of XLink Communications.

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The Internet of things (IOT) is a bit like a wormhole where two parallel universes are coming together. By merging technology with devices, we're creating 'smart' devices. This allows products to coexist, connect and communicate in both a physical and virtual world. Should businesses wish to capitalise on networked device landscapes, they must leverage this connectivity to reveal things they didn't previously know.

According to Steve Prentice, VP and Gartner research fellow for executive leadership and innovation, when an organisation starts to think this way, everything from a light bulb to a Labrador can be fitted with sensors, measured and connected to a central hub or to other devices, monitoring what is happening at all times. "This requires companies to really think imaginatively," he says, calling on organisations to change business models, try new things and learn from other industries.

The IOT creates exciting new business opportunities, says Prentice. A real-time, connected world is one where organisations can manage and monitor remote devices and employees, monetise offerings by transforming products into services and extend and enhance capabilities. And the possibilities are endless.

"Cows are already posting updates from the fields, individual products transported by sea are reporting when they've fallen over, pills are reporting back to doctors that the correct dosage has been taken, cars report real-time performance data that affects insurance premiums," notes Grant Theis, co-founder of ttrumpet. "What is clear is that every business will need to be a software business in the future."

For Greg Vercellotti, executive director at Dariel Solutions, the IOT revolves around software. "Software has become the electricity that runs through everything we do in the connected world. By its very nature, the fact that any possible device (or thing) could be connected means that software needs to be approached differently to benefit users across business and consumer environments." The IOT is about connections, connections that seek to streamline processes and are built around bespoke software, developed with the business' unique needs and objectives in mind. This links operations and processes together across countries, continents and industries, Vercellotti says.

By retrofitting vending machines with touch-screens, video cameras and motion-controlled technology, Coca-Cola Amatil increased sales by 12%. In addition to a boost in sales, this new point of connection with the consumer provided the beverage company with information to make better decisions around location, maintenance and re-stocking. "The IOT can bridge the relationship gap between companies and customers where they traditionally only met at the point of sale," says Lee Naik, MD of technology strategy at Accenture SA. "The relationship can become a continuous interaction that lasts as long as the customer continues to use the product and/or corresponding services."

"The IOT has allowed many areas within the retail environment to be monitored and metered," says Hymie Marnewick, CCO of XLink Communications. He cites the roll-out of more extensive in-store WiFi networks as a key driver of multi-channel sales strategies and the retail IOT experience. WiFi has fostered new links between the consumer, the retailer and the product or service. While also reshaping the consumer's payment experience, he says. But the process of implementing these technological advancements is occurring gradually; retailers will embrace connectivity more rapidly as they begin to understand the value delivered from IOT-derived insights. "IOT has already had a major influence on retail and the way retailers manage their stores, and will continue to have an impact on this sector as both customer and retailer experiences advance."

Within the healthcare space, a more connected environment brings together everything from the ambulance to the X-ray machine, which improves processes, simplifies decision-making, saves time and ultimately has the potential to saves lives.

The Internet of things is a greenfield market where new use cases lead to new demand.

Craig Nel, sales consulting senior manager for Fusion Middleware, Oracle SA

Matthew Barker, regional manager for sub-Saharan Africa at Aruba Networks, highlights how medical analytics and artificial intelligence applications used in co-ordination with IOT-connected devices and robotics systems can bring together key data collected prior to a hospital visit. In this way, potential patients can be redirected to the appropriate facilities without even having to walk in the door. Using specialised patient behaviour apps and wearable biomedical technology, patient care and the monitoring of key health data can move beyond the walls of medical institutions, he says, citing the importance of mobility in this scenario. "Mobile patient monitors, mobile diagnostics machines and mobile clinical applications all enable clinicians to better diagnose, treat, monitor and manage patients."

According to Craig Nel, sales consulting senior manager for Fusion Middleware at Oracle South Africa, this level of medical advancement will be realised via innovations like digital pills that communicate with an app on a mobile device to track medication adherence, later sharing this information with healthcare providers. Similarly, smart contact lenses that track blood sugar levels, fitness platforms that gather and aggregate health data from wearable devices and smart scales and apps, will all create a more holistic image of patients.

While this new technology requires organisations to be agile and imaginative, they must also be careful, especially when it comes to how they use sensitive data, says Prentice, stressing that the fundamental issue here is who owns the data. While many take the view that the user 'owns' the data, at least in the moral sense, and that any usage must be for their benefit rather than for the organisation's enrichment, this is not a universally accepted belief. And regulation in this area is still somewhat limited as authorities struggle to keep up with changing technologies. By asking questions about data ownership, use and protection, Nel suggests that businesses can create an operational framework outlining very specific service level agreements, standards, business and governance processes.

Stuart Scanlon, sales and marketing director for New Era Solutions, is sceptical. Because the volume of data and variety of sources being monitored and gathered has grown exponentially, governments must consider both the risks and the value of the information being generated when developing policies. "Privacy has become extinct, like the dodo bird, whether enterprises want to acknowledge it or not. The volume of data that is constantly being exposed and gathered is increasing by the minute," he says, noting that mitigating these risks is just one of the tasks assigned to modern CIOs.

Software has become the electricity that runs through everything we do in the connected world.

Greg Vercellotti, executive director, Dariel Solutions

With these new networks of communication, organisations must recognise that their business now has a new perimeter, says Nel. "Business boundaries have shifted and in some cases have become blurred." The risks are real and industry standards around data deletion, privacy and data protection should be formally implemented and understood, he continues. "The IOT is going to revamp the way people think about security and privacy."

Businesses should note that the introduction of IOT devices in the workplace requires an update of IT policies, says Fortinet security consultant Jonas Thulin. Most organisations have outdated IT security codes and policies, which fail to include a number of new technologies - including the IOT. "We've seen policies that are still in place covering outdated technologies such as dial-up modems and fax machines. These need to be updated to encompass any device capable of connecting to the Internet."

Within the consumer space, smart TVs of the future will use facial recognition to monitor how many people watch a programme or to register positive or negative responses to content. In a corporate environment, IOT sensors on assembly lines provide insights into how a company could make processes more efficient. And in the public sector, smart sensors and management systems are utilised to control the flow of traffic or electricity supplies. In all of these scenarios, chaos would ensue were hackers to infiltrate these systems.

"The potential for criminals or business competitors to use the IOT is virtually limitless," says Thulin. "If someone is able to access the IOT devices or management systems, they could use them to slow down or sabotage processes, use the information gathered for competitive advantage or study the movements of staff in order to plan a crime." The IOT significantly increases the possibility of an attack, he adds, with vulnerabilities emerging not only on the actual connected devices, but also on the associated networks and cloud-based IOT management tools.

"The Internet of things is a greenfield market where new use cases lead to new demand. This new demand is fair game for everyone, where the rules of the current market don't apply. New players can appear out of nowhere and overtake incumbents. Disruptive opportunities will not last long, so if you don't act quickly, your competition will," says Nel. "These massively increased levels of intelligence can be used to make real-time decisions, creating competitive advantage for businesses, enriching experiences for their customers and opening the door to new opportunities for both."

Over the past decade or so, Internet-driven disruption has altered how industries and businesses operate. Heralded as the next era of connected and optimised machinery, the industrial IOT (IIOT) seeks to improve operational efficiency, create entirely new products, services and markets and use data to better tailor customer outcomes.

IIOT spans industries including manufacturing, mining, agriculture, oil and gas, and utilities. "It also encompasses companies that depend on durable physical goods to conduct business, such as organisations that operate hospitals, warehouses and ports, or which offer transportation, logistics and healthcare services," says Lee Naik, MD of technology strategy at Accenture SA.

The IIOT will reshape the structure of workforces, altering how people get things done. "The IIOT will free employees by allowing them to participate in more creative and collaborative work. Decision-making can be transferred to employees empowered by valuable data, while the design and creative process could become more iterative and experimental. Employees may have to develop working relationships with intelligent machines."

An increase in widely dispersed employees demands a new culture and tolerance of autonomy, according to Naik. Individually tailored working environments will become the norm. Business leaders will have to maintain the core values and common purpose within their organisations, while accepting the demand for more creative and dispersed workforces as a result of technological innovation.

For Naik, seamless access to real-time insights should be viewed as a strategic advantage as it empowers businesses to attract and create digital business opportunities, while allowing them to quickly react to competitive threats. In order to capitalise on the capabilities afforded by the IIOT, organisations must re-imagine business models, from internal operations and workflows to strategic partnerships, he says. This involves capitalising on the data at your disposal and putting the necessary people and strategies in place to support an IIOT environment, Naik continues. New organisational structures, fresh insights from real-time data and remote workforces are changing the nature of work, he notes. This requires companies to react. Fast.

The Internet of everything (IOE) could generate R152.58 billion in value for SA's public sector over the next decade.

This is one of the findings from a 2014 Cisco study on the value of the IOE within the public sector. According to the study, growth will be realised on two levels. At a city level, the value over the same period is projected at R131.24 billion and will be used to fund services such as mobile collaboration, smart electricity grids, cyber security, travel and chronic disease management.

For the average person, the value at stake is projected at R21.34 billion. Government departments can harness the value of the IOE for citizens by focusing on payments, counterfeit drug programmes, chronic disease management, telework and smart street lighting.

Some of the terminology may be new, but these processes are already well-established within many South African business environments, says Metacom MD, R'ean Van Niekerk. Most of the technical building blocks for the IOT are already in place, but there are several obstacles that will limit growth in SA, he adds.

Van Niekerk calls for the establishment of industry-wide communication standards, which are essential in order to realise the real benefits of this connected digital landscape. Unsurprisingly, he cites network coverage, capacity and connectivity as other major hurdles, as well as privacy and security concerns. But the possibility is there, it's just up to government and business to work together to pave the way for easily accessible, standardised and secure connected environments.

In the past, you had to phone a call centre to order a taxi. The person in the call centre would then communicate with the taxi driver and send a car to your location. Uber has made this process more efficient, allowing you to communicate directly with a cab driver in your vicinity. For Alan Knott-Craig Jr, founder and CEO of Project Isizwe, the beauty of this platform and of the IOT in general is that it makes things more seamless by cutting out the middleman.

And this is just the beginning.

Describing the Internet as a serial killer of middlemen, he believes the disruption we've seen in the taxi industry, thanks to Uber, is starting to happen in many other industries and will bring about drastic changes in how things are done. "People, governments and institutions have a natural inertia when it comes to disruptive change, but change is a good thing. Especially if this change is making processes more efficient and helping people get things done along the way."

This is the aim of Knott-Craig's Project Isizwe, which seeks to provide free WiFi access to all South Africans. According to Knott-Craig, the initiative takes out the middlemen between the government - which wants to roll out ubiquitous Internet access for everyone - and the small businesses on the ground. Because the people in the middle tend to add huge mark-ups to things, projects can become financially unfeasible, he says. Project Isizwe aims to manage the process and make sure the guys on the ground deliver a quality product at as low a cost as possible. This will help the government make Internet access a reality for all South Africans. The country needs blanket WiFi coverage in order to truly realise the benefits of the IOT, notes Knott-Craig, but points out this is just a single access layer and the ultimate goal should be to offer people various ways of accessing the Internet wherever they are.

Nike makes footwear and fitness apparel. Once a customer has completed his/her purchase of a t-shirt or pair of running shoes, s/he no longer needs to be in contact with the brand until the item must be replaced. Acknowledging the fleeting nature of the customer engagement life cycle, Nike looked beyond its core offerings to provide customers with a more robust experience. Embracing the social aspect of exercise, the brand launched the FuelBand, a wearable activity tracker that allows athletes to monitor their performance. This provides Nike with an opportunity to interact with its customers every single day and gain insights about who these people are and how they use Nike products.

"Nike transformed their business with a completely new business model, created new opportunities and new revenue streams," says Craig Nel, sales consulting senior manager for Fusion Middleware at Oracle South Africa. Industry boundaries are being shaken by new business models and new opportunities.

The Internet of things is not so much about 'the Internet' or 'the things', Nel adds. "A sometimes forgotten truth is that the value of IOT products doesn't come from the technology or the Internet or the things. Making sense of data, turning it into knowledge and meaningful action, creates value. It's not the parking sensor that matters, but finding a free parking spot quickly and without frustration."

It's not about how to add a service to my product, but about making my product work with every other service, he notes. "It's about how all those sensors, devices, things and services can be integrated into the consumer's digital lifestyle. The user experience is key."

Grant Theis, co-founder of ttrumpet, agrees, referring to the Internet of everything, rather than the Internet of things. "The crucial difference here is adding people into the mix." And with most people carrying smartphones around with them wherever they go, utilising all the native functionality of these devices is key to providing and deriving value. Imagine if you fitted an NFC tag to the packaging of a chocolate bar; this would allow a brand to communicate with different consumers in an individual way, suggests Theis, providing the customer with an experience that goes beyond just consuming a sugary treat.

"A real-time, connected world requires a whole new way of thinking about the products and services a business provides."

Over the expected total economic value-add of $1.7 trillion worldwide by 2020 forecast by Gartner, manufacturing and healthcare share 30% of the expected impact.

Gartner predicts there will be 25 billion IOT units installed by the year 2020. These will generate an incremental revenue exceeding $300 billion.