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Posts from the ‘Industrial Internet of Things’ Category

The State Of IoT Intelligence, 2018

  • Sales, Marketing and Operations are most active early adopters of IoT today.
  • Early adopters most often initiate pilots to drive revenue and gain operational efficiencies faster than anticipated.
  • 32% of enterprises are investing in IoT, and 48% are planning to in 2019.
  • IoT early adopters lead their industries in advanced and predictive analytics adoption.

These and many other fascinating insights are from Dresner Advisory Services’ latest report,  2018 IoT Intelligence® Market Study, in its 4th year of publication. The study concentrates on end-user interest in and demand for business intelligence in IoT. The study also examines key related technologies such as location intelligence, end-user data preparation, cloud computing, advanced and predictive analytics, and big data analytics. “While the market is still in an early stage, we believe that IoT Intelligence, the means to understand and leverage IoT data, will continue to expand as organizations mature in their collection and leverage of sensor level data,” said Howard Dresner, founder, and chief research officer at Dresner Advisory Services. 70% of respondents work at North American organizations (including the United States, Canada, and Puerto Rico). EMEA accounts for about 20%, and the remainder is distributed across Asia-Pacific and Latin America. Please see pages 11, 15 through 18 of the study for specifics regarding the methodology and respondent demographics.

Key insights gained from the study include the following:

  • Sales, Marketing and Operations are most active early adopters of IoT today. Looking to capitalize on IoT’s potential to gain real-time customer feedback on products’ and services’ performance, Sales and Marketing lead all departments in their prioritizing IoT’s value in the enterprises. 12% of Operations leaders say that IoT is critical to attaining their goals. Executive Management and Finance have yet to see the value that Sales, Marketing and Operations do.

  • Manufacturers see IoT as the most critical to achieving their product quality, production scheduling and supply chain orchestration goals. Insurance industry leaders also view IoT as critical to operations as their business models are now concentrating on automating inventory and safety management. Insurance firms also track vehicles in shipping and logistics fleets to gain greater visibility into how route operations can be optimized at the lowest possible risk of accidents. Financial Services and Healthcare are the next most interested in IoT with Higher Education and Business Services assign the lowest levels of importance by industry.

  • Investment in IoT analytics, application development and defining accurate, reliable metrics to guide development is the most critical aspect of IoT adoption today. Investments in the data supply chain including data capture, movement, data prep, and management is the second-most critical area followed by investments in IoT infrastructure.  Analytics, application development, and accurate, reliable metrics guiding DevOps are consistent with the study’s finding that early adopters have an excellent track record adopting and applying advanced and predictive analytics to challenging logistical, operations, sales, and marketing problems.

  • IoT early adopters or advocates prioritize dashboards, reporting, IoT use cases that provide data streams integral to analytics, advanced visualization, and data mining. IoT early adopters and the broader respondent base differ most in the prioritization of IT analytics, location intelligence, integration with operational processes, in-memory analysis, open source software, and edge computing. The data reflects how IoT early adopters quickly become more conversant in emerging technologies with the goal of achieving exponential scale across analytics and IoT platforms.

  • The criticality of advanced and predictive analytics to all leaders surveyed is at an all-time high. Attaining a (weighted-mean) importance score of 3.6 on a 5.0 scale, advanced and predictive analytics is today considered “critical” or “very important” to a majority of respondents. Despite a mild decline in 2017, importance sentiment (the perceived criticality of advanced and predictive analytics) is on an uptrend across the five years of our study. Mastery of advanced and predictive analytics is a leading indicator of IoT adoption, indicating the potential for more analytics pilots and in-production IoT projects next year.

  • The most valuable features for advanced and predictive analytics apps include support for a range of regression models, hierarchical clustering, descriptive statistics, and recommendation engine support. Model management is important to more than 90% of respondents, further indicating IoT analytics scale is a goal many are pursuing. Geospatial analysis (highly associated with mapping, populations, demographics, and other web-generated data), Bayesian methods, and automatic feature selection is the next most required series of features.

  • Access to advanced analytics for predictive and temporal analysis is the most important usability benefit to IoT adopters today. Second is support for easy iteration, and third is a simple process for continuous modification of models. The study evaluated a detailed set of nine usability benefits that support advanced and predictive activities and processes. All nine benefits are important to respondents, with the last one of a specialist not being required important to a majority of them at 70%.

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Roundup Of Internet Of Things Forecasts And Market Estimates, 2018

 

  • According to IDC, worldwide spending on the IoT is forecast to reach $772.5B in 2018. That represents an increase of 15% over the $674B that was spent on IoT in 2017.
  • The global IoT market will grow from $157B in 2016 to $457B by 2020, attaining a Compound Annual Growth Rate (CAGR) of 28.5%.
  • Discrete Manufacturing, Transportation and Logistics, and Utilities will lead all industries in IoT spending by 2020, averaging $40B each.
  • Bain predicts B2B IoT segments will generate more than $300B annually by 2020, including about $85B in the industrial sector.
  • Internet Of Things Market To Reach $267B By 2020 according to Boston Consulting Group.
  • According to IDC FutureScape: Worldwide IoT 2018 Predictions, By the end of 2020, close to 50% of new IoT applications built by enterprises will leverage an IoT platform that offers outcome-focused functionality based on comprehensive analytics capabilities.

The last twelve months of Internet of Things (IoT) forecasts and market estimates reflect enterprises’ higher expectations for scale, scope and Return on Investment (ROI) from their IoT initiatives. Business benefits and outcomes are what drives the majority of organizations to experiment with IoT and invest in large-scale initiatives. That expectation is driving a new research agenda across the many research firms mentioned in this roundup. The majority of enterprises adopting IoT today are using metrics and key performance indicators (KPIs) that reflect operational improvements, customer experience, logistics, and supply chain gains. Key takeaways from the collection of IoT forecasts and market estimates include the following:

  • The global IoT market will grow from $157B in 2016 to $457B by 2020, attaining a Compound Annual Growth Rate (CAGR) of 28.5%. According to GrowthEnabler & MarketsandMarkets analysis, the global IoT market share will be dominated by three sub-sectors; Smart Cities (26%), Industrial IoT (24%) and Connected Health (20%). Followed by Smart Homes (14%), Connected Cars (7%), Smart Utilities (4%) and Wearables (3%). Source: GrowthEnabler, Market Pulse Report, Internet of Things (IoT), 19 pp., PDF, free, no opt-in.

  • Bain predicts B2B IoT segments will generate more than $300B annually by 2020, including about $85B in the industrial sector. Advisory firm Bain predicts the most competitive areas of IoT will be in the enterprise and industrial segments. Bain predicts consumer applications will generate $150B by 2020, with B2B applications being worth more than $300B. Globally, enthusiasm for the Internet of Things has fueled more than $80B in merger and acquisition (M&A) investments by major vendors and more than $30B in venture capital, according to Bain’s estimates. Source: Bain Insights: Choosing The Right Platform For The Internet Of Things

  • The global IoT market is growing at a 23% CAGR of 23% between 2014-2019, enabling smart solutions in major industries including agriculture, automotive and infrastructure. ― Key challenges to growth are the security and scalability of all-new connected devices and the adherence to open standards to facilitate large-scale monitoring of different systems. Source: Export opportunities of the Dutch ICT sector to Germany (25-04-17), PDF, 95 pp., no opt-in

  • According to  Variant Market Research, the Global Internet of Things (IoT) market is estimated to reach $1,599T by 2024, from $346.1B in 2016, attaining a CAGR of 21.1% from 2016 to 2024. Asia-Pacific is predicted to grow at the fastest CAGR over the forecast period 2016 to 2024. The growth is attributed to increasing adoption of IoT in emerging countries such as India and China, high rate of mobile and internet usage, and development of next-generation technologies. Source: Global Internet of Things (IoT) Market: Rising Adoption of Cloud Platform Noticed by Variant Market Research. 

  • Discrete Manufacturing, Transportation and Logistics, and Utilities will lead all industries in IoT spending by 2020, averaging $40B each. Improving the accuracy, speed, and scale of supply chains is an area many organizations are concentrating on with IoT. IoT has the potential to redefine quality management, compliance, traceability and Manufacturing Intelligence. Business-to-Consumer (B2C) companies are projected to spend $25B on IoT in 2020, up from $5B in 2015. The following graphic compares global spending by vertical between 2015 and 2020. Source: Statista, Spending on the Internet of Things worldwide by vertical in 2015 and 2020 (in billion U.S. dollars).

 

  • By 2020, 50% of IoT spending will be driven by discrete manufacturing, transportation, and logistics, and utilities BCG predicts that IoT will have the most transformative effect on industries that aren’t technology-based today. The most critical success factor all these use cases depend on secure, scalable and reliable end-to-end integration solutions that encompass on-premise, legacy and cloud systems, and platforms.Source: Internet Of Things Market To Reach $267B By 2020.

  • The hottest application areas for IoT in manufacturing include Industrial Asset Management, Inventory and Warehouse Management and Supply Chain Management. In high tech manufacturing, Smart Products, and Industrial Asset Management are the hottest application areas. The following Forrester heat Map for 2017 shows the fastest growing areas of IoT adoption by industry. Source: IoT Opportunities, Trends, and Momentum Robert E Stroud CGEIT CRISC.

  • B2B spending on IoT technologies, apps and solutions will reach €250B ($296.8B) by 2020 according to a recent study by Boston Consulting Group (BCG). IoT Analytics spending is predicted to generate €20B ($23.7B) by 2020. Between 2015 to 2020, BCG predicts revenue from all layers of the IoT technology stack will have attained at least a 20% Compound Annual Growth Rate (CAGR). B2B customers are the most focused on services, IoT analytics, and applications, making these two areas of the technology stack the fastest growing. By 2020, these two layers will have captured 60% of the growth from IoT. Source: Internet Of Things Market To Reach $267B By 2020.

  • Manufacturers most relied on the Industrial Internet of Things (IIoT) in 2017 to help better understand machine health (32%) on the shop floor, leading to more accurate Overall Equipment Effectiveness (OEE) measurements. Changing how plant maintenance personnel will work and interact with all levels of operation (29.5%) and helping to better prevent and predict shutdowns (27.1%) are the top three use cases of IIoT according to Plant Engineering and Statista. 

  • Improving customer experiences (70%) and safety (56%) are the two areas enterprises are using data generated from IoT solutions most often today. Gaining cost efficiencies, improving organizational capabilities, and gaining supply chain visibility (all 53%) is the third most popular uses of data generated from IoT solutions today. 53% of enterprises expect data from IoT solutions to increase revenues in the next year. 53% expect data generated from their IoT solutions will assist in increasing revenues in the next year. 51% expect data from IoT solutions will open up new markets in the next year. 42% of enterprises are spending an average of $3.1M annually on IoT. Source: 70% Of Enterprises Invest In IoT To Improve Customer Experiences.

  • McKinsey Global Institute estimates IoT could have an annual economic impact of $3.9T to $11.1T by 2025. Their forecast scenario includes diverse settings and use cases including factories, cities, retail environments, and the human body. Factories alone could contribute between $1.2T to $3.7T in IoT-driven value. Source: McKinsey & Company, What’s New With The Internet of Things?

  • Business Intelligence Competency Centers (BICC), R&D, Marketing & Sales and Strategic Planning are most likely to see the importance of IoT. Finance is considered among the least likely departments to see the importance of IoT. The study also found that sales analytics apps are increasingly relying on IoT technologies as foundational components of their core application platforms.These and many other insights are from Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study. The study defines IoT as the network of physical objects, or “things,” embedded with electronics, software, sensors, and connectivity to enable objects to collect and exchange data. The study examines key related technologies such as location intelligence, end-user data preparation, cloud computing, advanced and predictive analytics, and big data analytics. Please see page 11 of the study for details regarding the methodology.

  • Manufacturing, Consulting, Business Services and Distribution/Logistics are IoT industry adoption leaders. Conversely, Federal Government, State & Local Government are least likely to prioritize IoT initiatives as very important or critical. IoT early adopters are most often defining goals with clear revenue and competitive advantages to drive initiatives. Manufacturing, Consulting, Business Services and Distribution/Logistics are challenging, competitive industries where revenue growth is often tough to achieve. IoT initiatives that deliver revenue and competitive strength quickly are the most likely to get funding and support. Source: Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study.

  • IoT advocates or early adopters say location intelligence, streaming data analysis, and cognitive BI to deliver the greatest business benefit. Conversely, IoT early adopters aren’t expecting to see as significant of benefits from data warehousing as they are from other technologies. Consistent with previous studies, both the broader respondent base and IoT early adopters place a high priority on reporting and dashboards. IoT early adopters also see the greater importance of visualization and end-user self-service. Source: Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study.

  • Business Intelligence Competency Centers (BICC), Manufacturing and Supply Chain are among the most powerful catalysts of BI and IoT adoption in the enterprise. The greater the level of BI adoption across the 12 functional drivers of BI adoption defined in the graphic below, the greater the potential for IoT to deliver differentiated value based on unique needs by area. Marketing, Sales and Strategic Planning are also strong driver areas among IoT advocates or early adopters. Source: Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study.

  • IoT early adopters are relying on growing revenue and increasing competitive advantage as the two main goals to drive IoT initiatives’ success. The most successful IoT advocates or early adopters evangelize the many benefits of IoT initiatives from a revenue growth position first. IoT early adopters are more likely to see and promote the value of better decision-making, improved operational efficiencies, increased competitive advantage, growth in revenues, and enhanced customer service when BI adoption excels, setting the foundation for IoT initiatives to succeed. Source: Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study.

  • The most popular feature requirements for advanced and predictive analytics applications include regression models, textbook statistical functions, and hierarchical clustering. More than 90% of respondents replied that these three leading features are “somewhat important” to their daily use of analytics. Geospatial analysis (highly associated with mapping, populations, demographics, and other Web-generated data), recommendation engines, Bayesian methods, and automatic feature selection is the next most required series of features. Source: Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study.

  • 74% of IoT advocates or early adopters say location intelligence is critical or very important. Conversely, only 26% of the overall sample ranks location intelligence at the same level of importance. One of the most promising use cases for IoT-based location intelligence is its potential to streamline traceability and supply chain compliance workflows in highly regulated manufacturing industries. In 2018, expect to see ERP and Supply Chain Management (SCM) software vendors launch new applications that capitalize on IoT location intelligence to streamline traceability and supply chain compliance on a global scale. Source: Dresner Advisory Services’ 2017 Edition IoT Intelligence Wisdom of Crowds Series study.

Sources:

10 Predictions For The Internet Of Things (IoT) In 2018

2017 Internet Of Things (IoT) Intelligence Update

Bain Insights, Three Ways Telcos Can Win On The Internet Of Things [Infographic]

Bain Insights: Choosing The Right Platform For The Internet Of Things

Big Data & Analytics Is The Most Wanted Expertise By 75% Of IoT Providers

Cambridge Consultants, Review of latest developments in the Internet of Things, 7 March 2017, 143 pp., free, no opt-in.

Cognizant Trend Study: Digital Industrial Transformation with the Internet of Things: How can European companies benefit from IoT?

Ernst & Young,  Internet of Things Human-machine interactions that unlock possibilities –  Media & Entertainment. 24 pp., PDF, no opt-in.

GrowthEnabler, Market Pulse Report, Internet of Things (IoT), 19 pp., PDF, free, no opt-in

IDC, Worldwide Spending on the Internet of Things Forecast to Reach Nearly $1.4 Trillion in 2021, According to New IDC Spending Guide

IHS Markit IoT Trend Watch 2017, pdf, 26 pp., free, no opt-in

Internet Of Things Market To Reach $267B By 2020

Internet Of Things Will Revolutionize Retail

PwC, Leveraging the Upcoming Disruptions from AI and IoT, 20 pp., PDF, free, no opt-in

McKinsey & Company, Beyond The Supercycle: How Technology Is Reshaping Resources

McKinsey & Company,  Digital machinery: How companies can win the changing manufacturing game

McKinsey & Company, Taking the pulse of enterprise IoT

McKinsey & Company, What’s New With The Internet of Things?

IoT: Landscape and Nasscom Initiatives, May 2017. 36 pp., PDF, free, no opt-in

Stanford University Course EE392B, Industrial IoT: Applications Overview April 4, 2017, Dimitry Gorinevsky

Verizon, State of the Market: Internet of Things 2017 Making way for the enterprise

What Makes An Internet Of Things (IoT) Platform Enterprise-Ready?

Woodside Capital Partners, The Industrial Internet of Things: Making Factories “Smart” For The Next Industrial Revolution, PDF, 126 pp., free, no opt-in

THE INTERNET OF THINGS 2017 REPORT: How the IoT is improving lives to transform the world

The IoT Platforms Report: How software is helping the Internet of Things evolve

 

 

 

 

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