In part 1 of our discussion with David Stephenson, owner of Stephenson Strategies and a leading Internet of Things strategist, we talk about IoT attitudinal shifts and the power of access to real-time networked data. In part 2, we’ll cover the lay of the land in the IoT, as well as some opportunities and misconceptions around the IIoT in particular.
Wendy Toth: As someone who has recently been named one of the IoT’s global thought leaders, what’s your take on how we should be thinking about the IoT?
David Stephenson: First of all, the IoT is equal parts technology and attitude shifts. One of the things about the IoT is that it runs contrary to many, many years of ingrained management attitudes. That’s my niche in this area: this attitudinal shift and what it requires from participants in the IoT.
TOTH: Can you talk a bit more about the nature of this attitudinal shift?
STEPHENSON: In the past, we all had this great belief that the secret to success in technology industries would be to create a proprietary system and make customers entirely dependent on us. The only firm I know of that has been able to pull this off in current times is Apple, and I’m still astounded that Apple’s been able to do that. The whole trend at this point is this shift toward open data and sharing and collaboration.
We need to start asking entirely new questions—whether it’s about behind the firewall or in conjunction with your supply chain or your distribution network or directly with your customers—regarding who else can use your data. And that is a remarkable shift.
TOTH: What do you think will be the magnitude of this shift?
STEPHENSON: I’ve heard Echelon CEO Ron Sege talk recently about network effects, in the application of Metcalfe’s Law to the IoT. And I think he’s right, except he might be being too conservative. I think there’s almost unlimited potential for network effects when it comes to the IoT, largely because of this unprecedented level of data sharing.
And I think the potential for transformation is particularly important in the Industrial IoT (IIoT), where there’s finally a possibility to overcome what I refer to as ‘collective blindness’ about anything we simply can’t observe and document, particularly not in real time. Suddenly, that blindness has been lifted with the IoT and IIoT.
TOTH: Can you give an example of what you mean about the lifting of collective blindness?
STEPHENSON: The manufacturing sector and factory automation present lots of examples.
Until very recently, someone in manufacturing plants would walk around the factory with a clipboard writing down readouts from the dials and gauges on various pieces of equipment. That was as close as you could come to getting information about what was actually happening on the assembly line.
Contrast that to sophisticated manufacturing plants today, where the assembly line is equipped with thousands of networked sensors. Now, a manager walks around the factory with an iPad and has access to data from all those sensors, simultaneously and in real time.
TOTH: What can be done with that real-time data?
STEPHENSON: To start with, you can use the data to optimize production in ways never before possible. But the possibilities beyond production optimization are especially exciting.
When you have real-time access to the data from your assembly line, you can share it with your supply chain and your distribution network. This is making possible what I call the era of precision manufacturing. You can eliminate waste and streamline production.
I think it could even be a key to helping ensure jobs. Think about it. If you can share that kind of information on a real-time basis with your supply chain, doesn’t it makes sense that you would give preference to a supplier who is within an hour from your factory, as opposed to someone in China—where even with real-time information it’s going to take weeks to send you something?
So I’m very optimistic about the job creation potential with this kind of precision manufacturing, which is a direct application of the IIoT.
IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to firstname.lastname@example.org.