How will the Internet of Things affect your company?
The FT’s big read The internet of things: industry’s digital revolution provides corporate decision makers and L&D professionals with valuable perspectives on some challenges and opportunities of digital transformation.
The article notes how ‘the plunging costs of sensors, communications, data storage and analytics have made it possible to record and process huge volumes of information about physical systems, from trains to oil refineries to wind turbines.’
For example, the insertion of some 900 sensors on Amtrak trains in the US alerts the company to equipment failures, which has helped it reduce travel delays by one third in the past year. The range of measurements includes: ‘analysis of temperature, pressure, vibration, movement and flows of electrical current.’ This in turn helps ‘prevent failures, streamline maintenance, improve performance — and even change the way products are designed and made.’
According to the Boston Consulting Group, by 2020 companies will spend some €250bn annually on IoT, half of which will be in manufacturing, transport and utilities. Gartner research forecasts that by then business will use 7.6bn connected devices, double the current level. This affects recruitment and training too. One quarter of Bosch’s 20,000 software engineers, for instance, already now focus on IoT. Along with robotics and 3D printing, IoT will take manufacturing to the ‘next level of productivity.’
Needless to say, there are big challenges. With around 360 companies offering IoT platforms, it’s difficult to develop an industry standard. Also, large industrial companies worry about entrusting outsiders with important decisions, especially when it involves expensive and hazardous machinery. And there are obviously security concerns about third-party access to valuable company data. Start-ups, which are making much of the running, are often better than larger conglomerates at assuaging some of these fears by allowing customers to retain control of their own data. But this raises another important question: if managers ‘hand over control of their data, and defer to a service provider on decisions about how to run their operations, what value are they adding?’
Perhaps a bigger issue for learning and development is that many large companies are simply not in a position to benefit from the new technologies because they require radical organisational change which too many firms are simply not able to implement.