IoT – What it really means and how your business can benefit from it

Smart phones, smart cars, smart homes, smart businesses – everything seems to be smart these days. People keep talking about the possibilities of digitalization and Internet of Things (IoT) without really explaining what they actually mean. What is Internet of Things (IoT) really? What does digitalization have to do with it?

The actual definition of the Internet of Things is; the network of physical objects that contain embedded technology to communicate and sense or interact with their internal or external environment. Other way to put it is that IoT is a scenario in which objects are provided with unique identifiers and the ability to transfer data over a network without requiring human-to-human or human-to-computer interaction. IoT has evolved from the convergence of wireless technologies, micro-electromechanical systems (MEMS) and the Internet.

A ‘Thing’ in the Internet of Things can be any natural or man-made object that can be assigned an IP-address and provided with the ability to transfer data over a network. For example, a person with a heart monitor implant, an animal with a biochip transponder or an automobile that has built-in sensors to alert the driver when tire pressure is low. IoT is mostly associated with machine-to-machine (M2M) communication. Products built with M2M communication capabilities are often referred as smart products, like the ones mentioned in the beginning of this blog. These are the products we know, such as smart phones, we could not live without anymore.

Digitalization on the other hand means the use of digital technologies to change a business model and provide new revenue and value-producing opportunities; basically it is the process of moving to a digital business.

Alright so Internet of Things is basically the network revolving around us, making our cars, (future) homes and other devices smart and connected. Digitalization is the process of implementing this digital network to your business. Sounds interesting but how can it really improve your business? Does it mean that you should just buy the whole personnel connected smart phones? You could, but the main point of using IoT in your business is to achieve greater value by exchanging data between connected devices.

• You can for example engage your customers better by sending out promotions that can be sent straight to their smart watches or smart phones, which means that your customers get to see the latest updates in real time.
• You can also advertise your business to attract potential clients by using location based technology (such as Foursquare) and providing relevant information to anyone walking past or entering your place of business.
• Your everyday business activities can also benefit from the IoT by improving internal communication with your personnel by using for example IM messaging and online web apps which will allow you to collaborate with one another wherever you are.
• Adding data-collecting sensors to factory machinery, office buildings or warehouse selves can help you to minimize errors, be more flexible with changes and accelerate new products/service introductions.

The Internet of Things and constant connectivity have opened up a lot of opportunities for new businesses and startups as well. Digital technology will improve products and services, provide customized solutions and deliver a better customer experience.  Each company will find different opportunities in the Internet of Things, but all companies share the desire to increase revenue, scale efficiently and set themselves apart from competition. Would now be a good time to figure out what your company can achieve with IoT?

Read more about Good Sign’s solutions for the Internet of Things.