There is no point in harnessing the Internet of Things (IoT) if businesses are not able to extract value from the data that is collected, according to Lee Hickin, Microsoft Australia Internet of Things group lead.
"The end result is when a business can get value from an IoT strategy by taking the data and doing something with it, and not generating data for the sake of generating data," he said.
Hickin pointed out recent research, conducted by analyst firm Telsyte on behalf of Microsoft, which showed that 65 percent of organisations in Australia that have deployed IoT solutions saw a 28 percent cost saving in day-to-day operations.
"That points to those that are making the leap today, and cutting through the chaff of complexity and getting to the point of what we can make tangible to our business, are reaping the rewards," he said.
"Organisations that aren't taking advantage of the Internet of Things are missing out on the opportunity in their industry to be a leader, innovator, and thinker."
The Cut through: How the Internet of Things is sharpening Australia's competitive edge report (PDF) also highlighted reasons why businesses continue to avert the adoption of an IoT strategy. It said that 20 percent of companies are still unaware of the concept.
"IoT is very much like when internet banking became a mainstream event. At that point, we were all very scared about the process of doing it. But we've flipped that mindset, and we've got to a point where we don't think about not doing it. Any of these things in the right context can make that flip when everyone can see the advantage," Hickin said.
At the same time, the research found that businesses are facing three other main challenges. These challenges include technology challenges such as the integration of new infrastructure, affordability of services, and security concerns.
On the topic of security concerns, Telsyte managing director Foad Fadaghi said it is often a segue into data privacy, and that the degree of data protection will differ between industries.
"It's a challenge any player will need address on how the data they are collected is handled and stored," he said.
Hickin agreed, saying there is no doubt that security is always a top concern in the market.
"Partners will play a role in bridging the gap; I'm not saying that partners will plug holes, but I think one of the key things will be based on the architecture of your IoT solution, and that there are certain data that needs to be here and data that needs to be there," he said.
Despite the challenges, Fadaghi advised that companies start small and then scale their IoT strategy, adding that the cloud will play a critical part in enabling it.
"You need to prove something to management; we know that management often needs to be convinced by what are the benefits of the Internet of Things," he said.