Sensors, mobile devices and related technologies are presenting new opportunities and risks for business. Collectively known as the Internet of Things (IoT), this broad terms covers all non-computer and non-phone Internet connected devices.
Many in the business community view IoT devices as interesting consumer gadgets, like the Fitbit or the Apple Watch. Increasingly, though, IoT devices are coming into their own for business and industrial use, and in the process reinventing such industries as healthcare and transportation.
These trends suggest that the first wave of IoT technology has arrived in the form of consumer adoption. The estimates presented in the sidebar, “Internet of Things: Key facts for CIOs,” suggest several million Americans are already carrying IoT devices in their daily life. It’s an exciting trend with much potential for firms that produce IoT products and services.
Internet of Things: Key facts for CIOs
- Consumer devices. Consumer devices based on the IoT concept include the Apple Watch (the BBC estimates over 2 million sold as of July 2015), fitness trackers (3.3 million sold in the U.S. in 2014, according to Business Insider) and other devices.
- Falling sensor costs. Sensors are a key component in IoT. The Globe & Mail reports that sensors will cost an average of $0.38 in 2020 (compared to $0.50 today).
- Economic impact. According to McKinsey Global Institute research, “the impact of the Internet of Things on the global economy might be as high as $6.2 trillion by 2025.”
- IPSO Alliance. Established in 2008, the IPSO Alliance is a membership organization that brings together companies such as Google, Cisco, Intel and Oracle to create standards and support “Smart Objects” technology.
- BYOD policy considerations. According to ISACA’s 2014 Risk Reward Barometer survey: “61 percent indicated that their BYOD policy does not cover wearables in the workplace and another 18 percent did not even have a BYOD policy.”
As technology leaders, CIOs have a responsibility to evaluate strategic technology for their organization. The consumer examples may lead you to think this technology may not be relevant to enterprise technology. In fact, there is a strong case to be made for using IoT in the enterprise. A closer look at two industries – healthcare and transportation, for instance – show how organizations are meeting their goals with this technology.
IoT in healthcare: improved patient care, but security concerns remain
Of all the personal data we accumulate in our personal and digital lives, health data is one of the most sensitive categories. Inappropriate sharing of health information has the potential to damage careers, harm reputations and worse. At the same time, digitizing and streamlining the sharing of health data has the potential for dramatic gains in efficiency significant cost savings – Goldman Sachs recently estimated that Internet of Things (IoT) technology can save billions of dollars for asthma care. It’s a challenging dichotomy, as CIOs continue to look for ways to manage the risks of IoT and capture the benefits. Consider the following examples:
- Flexible patient monitoring. Keeping patients in a hospital setting is expensive. The average daily cost for a single inpatients was over $1,700 in 2013, according to the Kaiser Family Foundation. Remote monitoring products – such as the BodyGuardian Remote Monitoring System – give healthcare pros the option to move patients to their home and retain monitoring of their status by doctors and nurses. The BodyGuardian system addresses security requirements in several ways. The system separates patient identification information and observation data. In addition, the system encrypts data on the device, during transmission and in storage.
- Improved drug management. The expense of creating and managing drugs is one of the biggest issues facing the healthcare industry today. Forbes reported the average cost to develop an approved drug at $55 million (drug companies have stated higher costs). In addition, there is a multi-billion dollar industry in fraudulent drugs. IoT devices and processes may prove helpful in better managing these costs. In 2004, the Food and Drug Administration (FDA) laid out guidelines for RFID (Radio-frequency identification) and drug supply chain management. The first step was to add RFID tags to medication containers. Adding these tags enable producers, consumers and regulators to have greater confidence in the drug supply chain. The next step is embedding technology into the medication itself. WuXi PharmaTech and TruTag Technologies are just two companies developing edible IoT, “smart” pills that can help monitor both medication regiments and health issues, which can in turn help drug companies and healthcare providers alike mitigate risks and losses.
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