Published in The Manufacturer  May 2015 by Nick Frank, Co-Founder of Si2Partners

The Internet of Things (IoT) is all marketing hype and of little value or relevance to SME’s

It may be a question of perspective, but the fact of the matter is that unless you do something with the data generated by these technologies, then there is no added value.

It’s not that these capabilities are important to the future of manufacturing. I believe quite the contrary. The ability for equipment to generate & collect data is increasingly blurring the distinction between products and services, such that these terms may well disappear in the next 10 years. Instead there is an increasing emphasis on the outcome and customer experience. So although it’s important for businesses to explore this capability, it’s not really the technology that is the limiting factor. It’s our own IMAGINATION.

The challenge is to have such a deep insight into how our customers make money, that we can start to imagine how to use data to make a difference to their profitability. Some call this Service Thinking, but the really big leap is to engage our imagination. However, most of the leading examples of Service Thinking involve big companies with complex engineered products such as jet engines, weapons systems or vehicles. But it’s not only big companies that have imagination!

I recently met with Gerard Shaw who is MD of a small Northern Irish company, who style themselves as ‘Cloud Data Innovators’ with their recently introduced Web Portal (www.listo-portal.com). Gerard went out of his way to explain that all of the imagination comes from his customers. His expertise is as an enabler, creating simple hardware/software platforms that collect and make data available for clients. His goal is to find people with big imagination and insight. He gave me a number of seemingly everyday mundane examples where companies have done this.

Take a dairy cattle farmer. The yield of milk can be boosted by 30% if a cow has the right balance of additives supplied in the form of ‘Nuts’. It’s so important to the farmers business, that the feed supplier guarantees to ensure ‘Nuts’ are always available, but this causes them huge logistics cost when there is an emergency. Someone with insight and imagination realised that adding a simple monitor to the ‘Nuts’ feeder and putting the data into an easily accessible database in the cloud, could enable farmers to ensure his cattle always have the optimum milk output, In addition the feed supplier can see delivery problems before they happen. A simple IoT solution created through imagination that impacts the profitability of the farmer and the feed supplier.

Another example Gerard identified with a 3rd party maintenance company was air-conditioning units. They realised that they could provide a superior service, at a lower cost that increases product revenues by collecting two standard outputs; (1) whether a unit is running; (2) what is the pressure across the filter. Through a simple plug &play solution and web portal application, they can now see failures and react before their customer’s report it. They can see poor performance and make a planned visit, or see such poor performance they can recommend the sale of a new unit.

A third example was the maintenance of submersible pumps in Landfill sites to prevent contamination of the water table. Remote monitoring enable the sites operations team monitor performance to ensure expensive regulatory fines are avoided. Add to this a weather forecast on rain, and alerts could be taken to take preventive action where pump performance was known to be marginal.

These are all solutions that been created by small businesses, that have deep insight into their customers needs. None needed any new technology. According to Gerard, the key is to understand the one or two critical parameters to be monitored that will make a difference.

So before rushing out and investing in the IoT, sensors and fancy analytics, perhaps a first step is to gain insight into what will make a difference to your customer’s business and then engage your imagination to see how to get there.