Slowly we have seen an uptake of Internet of Things (IoT) as an enabler of business – especially since the start of 2018. It’s as if business has kicked into high gear. And not only on a global level, but locally as well.
There is an unspoken consensus that part of the drive for business to adopt and drive the concept of IoT is the perceived rise in business confidence brought on by the change in government. At the core, the perceived governmental stability has afforded business the confidence to try these new technologies, noting the imperative to keep up globally.
Globally and locally it has become evident that digital transformation is about more than the technology – it is about the people, and business needs to change its core narrative to drive the change. Regardless of the size of a business, if this is not at the core of the change then technologies become mere initiatives, with no real value at the end of the day. And as much as reworking the business operations narrative of your company is not a comfortable process, it is a necessary one.
Three themes that raised by business as having an influence when adopting IoT have been the costs involved; whether South African business is ready for IoT; and what does it mean for job security in the workplace.
South Africa is ready for the adoption of IoT, we are primed for it, based on the legacy issues we have been sitting with for the past decade. A more telling sign of the times is that business is going out there to find information on IoT, no longer are they waiting for it to come to them. For example, at the recent Investing in Mining Indaba in Cape Town, Deloitte introduced Intelligent Mining Solution, which drew a lot of attention, from not only a local but also an international audience. Intelligent Mining Solution allows mining in real-time and allows for decision-making at critical pivot points using the data at hand. The introduction of IoT in the mining industry does not mean job losses per se, but rather cost reduction and frees up funds for other capital investment and expanding assets, which indirectly would mean increased job opportunities at these mines.
Cost is still a huge factor and the initial capital investment is quite steep, but the more prevalent IoT becomes in business the more costs will come down – these are basic economies of scale. As a result of the high costs a lot of companies are starting small and using these case studies as proof points for bigger investments. Companies need to make sure that these investments will generate value and that they have proof of concept.
A key learning on the back of implementing IoT at a number of companies is that companies are realising that where they thought the benefit or cost sits, is not necessarily the right place. This does mean that there is not always an intrinsic value to those exercises, but it provides valuable insight and allows for better decision making. As a strategic partner/driver Deloitte has seen this in more than one case study and therefore partners with clients to not only identify the problems and qualify a solution, but also helps clients to execute and implement on the agreed solution.
Furthermore, IoT will be one of the main enablers for automation in the workplace and initially it will provide a granular level for machine learning to be more effective. Directly it won’t necessarily have an impact on jobs, but indirectly it will. Initially it is expected that this impact will be negative meaning that there will be a lot more automation and efficiencies in the workforce, and thus a loss of some jobs. The flipside – and the long-term view – to that, however, is that we will have, for example, improved safety and training opportunities through the immersive user experience of virtual and augmented reality. Further to that the introduction and roll-out of new skills training will be amped-up allowing for business to transfer skills at a much faster rate. All of which would be based on IoT.
Taking everything into consideration business needs to start adopting IoT sooner rather than later and it is as simple as starting to define a strategy for IoT – in the next 18 months every company should at least have this. Importantly, IoT needs to be underpinned with a business case or any business led tech otherwise it just becomes a nice toy and you are not deriving any value. Deloitte helps business pull that business case together, understand where the value sits and gives a holistic view – we help organisations find the problem, identify the solution and implement the plan.