There is set to be a rise in IoT in Risk Management in the near future. The Internet of Things (IoT) is the next phase in the digital revolution. By 2020, it’s projected there will be anywhere from 25 to 50 billion things connected to the IoT – that’s seven connected things for every person on the planet. While IoT has many interesting domestic applications, its true value will be driven by business, particularly in risk management.
Speaking at the “Better Business through IoT” breakfast seminar hosted by IsoMetrix on 27 September 2017, Steve Dunbar, IoT and Advanced Analytics Business Lead (MEA HQ) for Microsoft stated that “IoT is a business revolution being fueled by technology.” As businesses increasingly rely on technology for their competitive advantage, IoT gives risk managers a wealth of information for assessing and managing risk. “The ability to develop has never been easier, and we have never been more connected,” he explained.
IoT will allow us to build things, and control things remotely. It also lends itself to the collection of big data to gain new insights into businesses and take appropriate action – sometimes before an incident has occurred, by using predictive analytics.
However, implementing IoT as part of a risk management strategy can be complex. It is difficult to maintain cohesive security across multiple devices and software applications and it can be time-consuming to get started. New technologies may be incompatible with existing infrastructure, and it can be challenging to scale these technologies over time. Therefore, it is important to implement IoT strategically, and from the top (board level) down. “IoT fails when the business value isn’t fully realized. IoT projects should start at board level, and not in the IT department,” explains Steve.
IoT should be viewed as a business enabler more than a technology because IoT changes what is possible. It allows businesses to:
“IoT makes the invisible visible,” commented Steve. It leads to better risk identification and mitigation through predictive analytics and creates more resilient, sustainable business that is better able to adapt to market changes and uncertainty.
“IoT is the key to digital transformation,” Steve explained, “It is a business revolution.” Most IoT is currently used for remote monitoring, predictive maintenance, and asset management. However, implementing strategic IoT requires transformational thinking to unlock its true potential.
During his presentation at the IsoMetrix “Better Business through IoT” breakfast seminar, André Strauss, Director of Partnerships at IoT.nxt asked, “How integrated is your business really?” Mainstream adoption of IoT is hampered by non-standard protocols that prevent proper integration, too much data cos, and an unclear business value.
According to the Gartner Market Guide for IoT Platforms 2017, businesses seeking to use IoT platforms for their digital business initiatives are challenged by partial technology stacks and crowded vendor spaces. “Enterprises are forced to implement solutions from multiple vendors, and be responsible in the long term to require integration into central enterprise resources.”
Interoperability and interconnectivity are the two fundamentals of an IoT platform. This is problematic, because as André explained, “Creating the business case for IoT relies on unlocking its true business value through proper integration.”
A look at the digital landscape today shows numerous islands of digitzation. “These things were never designed for integration,” said André. The power of IoT lies in the Edge, with horizontal integration. Many early IoT applications simply collected data and sent them elsewhere for analysis. The growing computing capacity of things now allows increasingly complex computation to run on-site, and this computing capacity is referred to as the Edge, because of the fact that part of the work happens right at the edge of the network where IoT connects the physical world to the Cloud.
The Edge is defined by Joe Biron and Jonathan Follett in their book Foundational Elements of an IoT Solution, as including “a wide array of sensors, actuators, and devices – those system end-points that interact with and communicate real-time data from smart products and services.”
Edge computing is much more than having computation and data processing on IoT devices. A fundamental part of it is the strong and seamless integration between IoT and Cloud; between the physical world and the world of computation. “We believe the future of IoT is intelligence at the edge,” André explained.
Interoperability and integration is vital. “You need an intelligent gateway to retrofit integration onto a system, to unlock the real value of an IoT system,” continued André. “This way you can bridge the gap between the Edge and your cloud services, enterprise systems and content services.”
Digital innovation with IoT is the future of risk management. By taking advantage of emerging technology such as the IoT, and implementing integrated systems, you can collect and analyze massive volumes of data from an unlimited number of sources across multiple locations. In this way, you can enhance operational processes to improve the timeliness of reporting and utilize data to drive preventative actions, placing you a step ahead of potential risks.