IoT is driving the digital transformation
The digital transformation is opening up huge opportunities for improving people’s quality of life, creating new business models and developing more efficient business practices through the use of new technologies.
For PwC, the Internet of Things (IoT) is one of eight future technologies ("the Essential Eight") that will make the digital transformation tangible, decisively shape it and have the greatest influence on value creation in the medium term.
IoT refers to a network of physical devices connected by sensors and software via the internet which allows data to be exchanged. Its various applications span almost every sector: networked manufacturing and energy supply; networked buildings and cities; networked agriculture and healthcare.
Facts and figures
The importance of the Internet of Things is growing rapidly and has already become an accepted technology
The IoT hype continues
IoT is one of the greatest technological disruptors of our time. It creates opportunities to develop new products, services and business models, and even to establish entire ecosystems.
The IoT hype continues unabated: Gartner predicts there will be 20 billion networked devices by 2020 (vs 8.4 billion in 2017); IDC estimates IoT expenditure of $1.2 billion by 2022; analysts forecast potential IoT sales of €50 billion for Germany in 2020. The industry association Bitkom counts IoT among the top three trends in the ITC sector.
Apart from all the potential, the actual impact of IoT varies considerably depending on a company’s maturity. Many companies are still in the orientation stage: they have launched pilot projects and are developing IoT-enabled products and services, or are using IoT to improve their own efficiency – very few have yet to move beyond the pilot stage. For companies that have managed to get to the next level, IoT is now a fixed item on their digital agenda. Above all manufacturing companies are using IoT to optimise efficiency and cut costs. Companies from the automotive industry are creating new digital services, while in the household the smart home awaits – all powered by IoT.
"The point about the Internet of Things is not the technology, but the business value it enables."
The first step is always the hardest. PwC will help you find the best starting point – with four key questions based on the IoT value chain
1. What role do you want the company to play in the IoT sector?
- Service provider
- Service broker
- Orchestrator of ecosystems
2. Why do you want IoT to be used in the company?
- Increase your profitability
- Generate new growth
- Redesign customer experience
3. What IoT capabilities are required for success and how will they be established?
- Capabilities: professionalism, technology, digitisation, sales/marketing
- Established by: sourcing scenarios (make, buy, partnerships)
4. What are the next steps needed to launch IoT in the company?
- Outside-in analysis of potential
- Target scenarios
- Development of initial prototypes (minimum viable product)
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