Analyze the data or prepare to be disappointed.Sensor data without analytics is nothing but noise.
And right now there is a lot of noise being produced. Although still at the early-adopter stage, the Internet of Things is spawning a myriad of sensor-based technologies from the personal to the industrial realms. In just five years, 50 billion devices are projected to be connected to the Internet, generating an estimated $2 trillion to $14 trillion in value.
Expectations are also running high, so high, in fact, that Gartner ranked IoT at the top of its 2014 Hype Cycle for Emerging Technologies. Companies are naturally eager to get a piece of the action with as many as three out of four exploring how IoT technologies could fit into their business operations. Too many times, however, companies end up with a ton of data and no actionable information.
This is when analytics come into play.
Unless businesses turn the focus away from pure data collection to data analysis, investments in IoT technologies are doomed to produce disappointing results. Vendors of sensor technologies would simultaneously be wise to take their services beyond singing the virtues of amassing data to showing their clients how to make sensor-driven decisions. The data should do more than “look pretty on a dashboard,” as Steven Sarracino, founder of Activant Capital Group, LLC, in Greenwich, Conn., pointed out.
The need for more guidance was also captured in a fleet report by Tracking Automotive Technology: TU Automotive (previously Telematics Update). Vendors should, according to the report, present the data in a digestible format to assist overwhelmed end-users.
While purely monitoring the performance of a forklift, for example, provides value, it is not until the data is analyzed and acted upon that maximum ROI is achieved. In the case of a forklift fleet, it might entail optimizing routes in the warehouse or performing preventive maintenance.
Or take the example of the retail industry where analytics can be applied to data collected by security cameras and Wi-Fi beacons to help retailers understand what types of displays catch customers' attention.
Adoption of IoT technologies will likely come easier to industries such as manufacturing and supply chain which already connect machinery and fleets with Internet-enabled sensors or devices. Smart grid technologies also hold a lot of promise for public utilities, connecting countless data points for continuous monitoring and proactive management of the power supply.
But until companies are able to adequately apply analytics to squeeze value out of their investments, it may be a while before IoT technologies reach critical mass.
Do you think IoT technologies will live up to the “overinflated expectations”?