The future’s always looked rosy for the Internet of Things since it first became a serious enterprise consideration over the past few years. Now, recent projections have forecasted that its growth will surpass expectations in the near future, as businesses increasingly find ways to glean results from their investment, as well as figure out means of monetizing it.
According to a Gartner forecast, Internet of Things devices will rise to 4.9 billion in 2015, an increase of 30 percent from those in use this year. That number is projected to balloon to 25 billion by 2020. As Gartner stated, there are few industries and societal arenas that will not feel the effects of the far reach of the Internet of Things, not to mention the businesses that will see widespread transformation due to increased adoption.
Jim Tully, Gartner vice president, stated that Internet of Things, past the point of optional, early adoption, will become a business imperative for a wide swath of organizations over the next few years.
“The digital shift instigated by the Nexus of Forces (cloud, mobile, social and information), and boosted by IoT, threatens many existing businesses,” Tully stated. “They have no choice but to pursue IoT, like they’ve done with the consumerization of IT.”
A Numbers Game
The rise in Internet of Things devices will be accompanied by a correlation in the increase of services that support their installation, maintenance and analytical use, with spending on such solutions projected to hit $69.5 billion next year and surpass $260 billion by 2020. The breakdown between consumer and enterprise use is interesting, as Gartner projected that while consumer applications will be the biggest factor in the sheer number of connected things, enterprise use will lead to most of the revenue.
Sectors such as manufacturing, transportation and utilities will be at the forefront of Internet of Things adoption as automation and ease of installation makes widespread deployment of these devices more practical.
While it seems apparent that the devices will be there – not just instruments used today, but many technologies that are merely in their first theoretical stages – what is less clear is just how businesses can best capitalize on the new opportunities. It’s an opportunity and a challenge for enterprise leaders, IT personnel and business users alike, with far-reaching implications on information security, application environment management and investment of IT resources.
As Gartner fellow and vice president Steve Prentice pointed out, the normalization of Internet of Things devices in the workplace and in consumer environments means that it soon won’t be enough to simply install devices and use them for their bare minimum of benefits – organizations need to be proactive in using these powerful tools as a means of recalibrating business strategies.
“CIOs must understand that the most disruptive impact and competitive threats — and, equally, the greatest competitive opportunities — arise not from simply digitalizing a product or service, but from creating a new business model and value proposition,” Prentice stated.
…And an Opportunity
Harvard Business Review contributor John Hagel III observed that many of the uses of Internet of Things technologies have focused on facility improvement. This makes sense, as these devices could bring more clarity, visibility and saved opportunity costs to a variety of business operations. The challenge – and the opportunity – is to use Internet of Things devices in service of performance enhancement.
Performance improvement means combining Internet of Things devices with analytical capabilities, stepping back and evaluating patterns. By using the various Internet of Things tools to form a bigger picture, organizations can give themselves the ability to improve reliability, productivity and management effectiveness. Eventually, rather than simply use Internet of Things tools to optimize facilities and operations, enterprises will ideally be able to leverage them to make powerful new observations about changes that could benefit their partnerships, market or industry.
Critical to the development of Internet of Things use will be upgrading enterprise IT environments to handle the influx of data. Whether a company hones in on hybrid clouds as a means of gaining control over data or outsources its information storage to an offsite data center, it will be important to keep hardware and infrastructure support concerns at the forefront.