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Realizing the full potential of the
Internet of Things
2 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
The “Internet of Things” (IoT) is often described as a
collection of connected sensors, but it is actually a much
more complex concept.
It involves not only the connection and integration of
devices that monitor the physical, but also the
aggregation, relationship, and analysis of the
information those devices create.
In order to be successful with the IoT, firms need to
focus not only within their own products and services,
but outward to a complex ecosystem of partnerships
and collaborations
3 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
To better understand the IoT, let’s take for an illustrative example: the
wearable activity tracker and the emerging industry of tracking physical
and health activities. These devices are one of the most prominent offerings in
the IoT pantheon.
Their potential benefits are revolutionary in that they promise to accurately
monitor and analyze health and fitness activity on a continuous, real-time basis.
4 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
5 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
There are several layers of activity mixed up in
conversations about the Internet of Things.
The bottom layer of connected sensors dominates the discussion among
technologists. However, it is these upper layers of IoT activity that, if not done
well, can cause most IoT initiatives or products to struggle or ultimately fail.
6 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Local sensing
The lowest layer of the IoT is the ability to sense some aspect of the physical
environment. An individual sensor typically measures a few components of a
narrow reality.
But the Internet of Things is not just—or even primarily—about the sensors.
steps taken
sleep quality
stairs climbed
distance traveled
7 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Data integration
Health activity trackers increasingly supply data not just to you, but to your social
network, your physician, your hospital, and your health insurance company. Since
activity trackers collect different types of data on different functions using
different formats, the integration layer is a substantial challenge.
Developing the standards to aggregate data and control sensors remotely across
different types of sensors and devices.
smartphone
hospital
social media
physician
8 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Analytics of things
It has been said that “data without meaning, without soul, will not move people
to change their behaviors over the long term.” Much of the benefit of the IoT lies
in our ability to leverage the useful data we collect with it.
Hit 10,000 steps today?
anomaly detection
optimization
comparative usage
prescriptionWhen in your sleep
cycle to wake up
Time to get off the couch!
Your calories
burned vs. others
9 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Cognitive action
Just as the brain needs hands, feet, and speech to carry out its decisions, IoT
networks need mechanisms of cognitive action if it’s going to accomplish much.
Consider, for example, what it would take to develop a widespread program of
cognitive action in health and fitness. Imagine what that future state might look
like:
updated electronic
health records
patient
compliance
doctor
monitoring
new health insurance
pricing models
new reimbursement
models
improved security
and safeguards
10 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
As a society we are very good at
developing new sensor technologies.
But when it comes to integrating data
across diverse systems and sensors from
multiple organizations, we still have
room to improve.
11 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
What does this mean for your IOT application?
To find your place in the IoT, you first need to envision a broad end-state. This
vision should address business problems the IoT will solve for you and your
customers. The end-state vision should also address the implications of the IoT
for your company’s competitive position and ecosystem relationships.
Through the IoT, technological change may make it possible to do without wires,
but we can’t escape the necessity of creating connections via planned
organizational and inter-organizational changes.
12 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Realizing the full potential of the IoT lies in collecting,
connecting, analyzing and acting on data.
Execution is everything.
Collecting
Connecting
Analyzing
Acting
13 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Share your thoughts with the hashtag #DeloitteReview
Follow @DU_Press on Twitter
How the Internet of Things may reshape consumer and industrial environments
For more, download the Deloitte Review article
Download
14 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
Meet the authors
JOHN LUCKER
principal with Deloitte Consulting LLP, Global
Advanced Analytics & Modeling market leader,
and a US leader of Deloitte Analytics.
TOM DAVENPORT
world-renowned thought leader and author,
the President’s Distinguished Professor of
Information Technology and Management at
Babson College, a Fellow of the MIT Center for
Digital Business, and an independent senior
advisor to Deloitte Analytics.
Follow @DU_Press
Sign up for Deloitte University Press updates at www.dupress.com.
About Deloitte University Press
Deloitte University Press publishes original articles, reports and periodicals that provide insights for businesses, the public sector and NGOs. Our goal is to draw upon research and
experience from throughout our professional services organization, and that of coauthors in academia and business, to advance the conversation on a broad spectrum of topics of
interest to executives and government leaders.
Deloitte University Press is an imprint of Deloitte Development LLC.
This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or its and their affiliates are, by means of this publication,
rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services,
nor should it be used as a basis for any decision or action that may affect your finances or your business. Before making any decision or taking any action that may affect your
finances or your business, you should consult a qualified professional adviser.
None of Deloitte Touche Tohmatsu Limited, its member firms, or its and their respective affiliates shall be responsible for any loss whatsoever sustained by any person who relies
on this publication.
About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally
separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms.
Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients
under the rules and regulations of public accounting.
Copyright © 2015 Deloitte Development LLC. All rights reserved.
Member of Deloitte Touche Tohmatsu Limited

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Realizing the full potential of the Internet of Things

  • 1. Realizing the full potential of the Internet of Things
  • 2. 2 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. The “Internet of Things” (IoT) is often described as a collection of connected sensors, but it is actually a much more complex concept. It involves not only the connection and integration of devices that monitor the physical, but also the aggregation, relationship, and analysis of the information those devices create. In order to be successful with the IoT, firms need to focus not only within their own products and services, but outward to a complex ecosystem of partnerships and collaborations
  • 3. 3 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. To better understand the IoT, let’s take for an illustrative example: the wearable activity tracker and the emerging industry of tracking physical and health activities. These devices are one of the most prominent offerings in the IoT pantheon. Their potential benefits are revolutionary in that they promise to accurately monitor and analyze health and fitness activity on a continuous, real-time basis.
  • 4. 4 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved.
  • 5. 5 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. There are several layers of activity mixed up in conversations about the Internet of Things. The bottom layer of connected sensors dominates the discussion among technologists. However, it is these upper layers of IoT activity that, if not done well, can cause most IoT initiatives or products to struggle or ultimately fail.
  • 6. 6 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Local sensing The lowest layer of the IoT is the ability to sense some aspect of the physical environment. An individual sensor typically measures a few components of a narrow reality. But the Internet of Things is not just—or even primarily—about the sensors. steps taken sleep quality stairs climbed distance traveled
  • 7. 7 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Data integration Health activity trackers increasingly supply data not just to you, but to your social network, your physician, your hospital, and your health insurance company. Since activity trackers collect different types of data on different functions using different formats, the integration layer is a substantial challenge. Developing the standards to aggregate data and control sensors remotely across different types of sensors and devices. smartphone hospital social media physician
  • 8. 8 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Analytics of things It has been said that “data without meaning, without soul, will not move people to change their behaviors over the long term.” Much of the benefit of the IoT lies in our ability to leverage the useful data we collect with it. Hit 10,000 steps today? anomaly detection optimization comparative usage prescriptionWhen in your sleep cycle to wake up Time to get off the couch! Your calories burned vs. others
  • 9. 9 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Cognitive action Just as the brain needs hands, feet, and speech to carry out its decisions, IoT networks need mechanisms of cognitive action if it’s going to accomplish much. Consider, for example, what it would take to develop a widespread program of cognitive action in health and fitness. Imagine what that future state might look like: updated electronic health records patient compliance doctor monitoring new health insurance pricing models new reimbursement models improved security and safeguards
  • 10. 10 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. As a society we are very good at developing new sensor technologies. But when it comes to integrating data across diverse systems and sensors from multiple organizations, we still have room to improve.
  • 11. 11 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. What does this mean for your IOT application? To find your place in the IoT, you first need to envision a broad end-state. This vision should address business problems the IoT will solve for you and your customers. The end-state vision should also address the implications of the IoT for your company’s competitive position and ecosystem relationships. Through the IoT, technological change may make it possible to do without wires, but we can’t escape the necessity of creating connections via planned organizational and inter-organizational changes.
  • 12. 12 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Realizing the full potential of the IoT lies in collecting, connecting, analyzing and acting on data. Execution is everything. Collecting Connecting Analyzing Acting
  • 13. 13 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Share your thoughts with the hashtag #DeloitteReview Follow @DU_Press on Twitter How the Internet of Things may reshape consumer and industrial environments For more, download the Deloitte Review article Download
  • 14. 14 Deloitte University Press | Realizing the full potential of the Internet of Things | @DU_Press #DeloitteReview Copyright © 2015 Deloitte Development LLC. All rights reserved. Meet the authors JOHN LUCKER principal with Deloitte Consulting LLP, Global Advanced Analytics & Modeling market leader, and a US leader of Deloitte Analytics. TOM DAVENPORT world-renowned thought leader and author, the President’s Distinguished Professor of Information Technology and Management at Babson College, a Fellow of the MIT Center for Digital Business, and an independent senior advisor to Deloitte Analytics.
  • 15. Follow @DU_Press Sign up for Deloitte University Press updates at www.dupress.com. About Deloitte University Press Deloitte University Press publishes original articles, reports and periodicals that provide insights for businesses, the public sector and NGOs. Our goal is to draw upon research and experience from throughout our professional services organization, and that of coauthors in academia and business, to advance the conversation on a broad spectrum of topics of interest to executives and government leaders. Deloitte University Press is an imprint of Deloitte Development LLC. This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or its and their affiliates are, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your finances or your business. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. None of Deloitte Touche Tohmatsu Limited, its member firms, or its and their respective affiliates shall be responsible for any loss whatsoever sustained by any person who relies on this publication. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. Copyright © 2015 Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu Limited