Data Will Be the Next “Oil”

Data is becoming a key business asset with tangible value. Owning the source of data, building value from it, and improving the business relevancy for customers will be game changers. The game will be less about selling products than owning the relationship and the data. Tomorrow’s winners will be the ones who have managed to not only connect their customers, but have made sense of the consequential flow of data to them.

Yet, we’re only at the start of unlocking the full value of the data at our disposal. The same is true for all the machine-generated and IoT data that exists and will soon become a real data flood. Are we ready to deal with it? And how can we leverage it in a smart, safe, and purposeful way?

The Data “Oil Well”

While data is omnipresent, it can be leveraged in more ways than it is today. While it needs to be turned into value, there are technical challenges to gather these volumes of data.

First is real-time transmission of information from devices such as sensors, which can require far more bandwidth than is available. Consider, for example, a smart operating room in a hospital, which could contain a wide variety of sensing devices to monitor every aspect of a patient’s health including their breathing, heart rate, blood levels, and even skin colour and muscle tone. It’s an overwhelming amount of data that must be analysed in real time as it can literally save lives. Or, take a large office building where contextual data is gathered on all levels, ranging from real-time alerts and meeting room occupancy to smart metering data for regulatory or energy saving goals and pattern detection.

Next, is the aggregation of the data and the intelligence that can be extracted from it. Aggregating data so that it can be useful presents different questions and opportunities alike. Consider a smart city concept with smart homes and buildings across a major metropolitan area; the amount of data is immense and continuous.

This information is also extraordinarily useful when examined on an aggregate level. Resource usage throughout a city can be predicted by analysing the aggregate data and then factoring in the effects of weather, social events, and other variables. Let’s take the example of a smart stadium that was connected to the surrounding metropolitan area; in a large event, such as a football game, it’s predictable that there will be a surge of traffic as the event begins and ends.

Sensors could report on the number of people in the stadium, and adjust patterns automatically as those people begin to leave the parking area. Businesses in the local area – such as restaurants – which normally close early, could receive notifications of the traffic surge and remain open longer.

The third challenge is the storage and legal ownership of the data. Does the customer own their information? Or, do the companies and businesses which collect information own it? Or, perhaps the data aggregators own the data; or is the data, once personalised information has been removed, available to the public domain? There are also legal aspects to consider such as the data general protection regulation (GDPR), which is intended to strengthen data protection in the European Union.

The Forest Behind the Trees: Dark Data

Recently McKinsey & Company calculated that on an oil rig with 30,000 sensors, only one percent of data is examined. Why? Because the data serves a purpose: detecting and controlling anomalies. When used for prediction and optimisation the unused data can create real value, the company stated. There is even more value at stake if you consider that, in practice, we use several data formats and sources in most applications where actionable information and decisions are the outcomes. A pharmaceutical company, for instance, combines IoT data, health data, data from wearables, hospital data, research data, and even genetic data to find new healthcare solutions.

Gartner defines dark data as the information assets organisations collect, process, and store during regular business activities, but generally fail to use for other purposes. You can imagine the opportunities and challenges of detecting, storing, and leveraging dark data.

IoT is the “Pickaxe” and “Shovel” of the Oil Race

The Internet of Things is connecting things with things, people with things, and people with people; this is unleashing an unprecedented flow of data. It will definitively change the way we work, live, and seek entertainment in smart buildings and cities. However, end-to-end connectivity on a broad urban scale has never been deployed. We should not underestimate the societal benefits of such connected ecosystems, which aim to reduce carbon footprints, provide better living conditions, cope with growing and aging populations, and ensure the security, safety, and comfort of citizens, while respecting their data and privacy.

There will also be more and more alternative and distributed sources of energy, which will raise the complexity of connected buildings, smart city ecosystems, and tomorrow’s digital factories. Considering that network infrastructure has evolved over the past 10 years, moving from basic hub to fully routed and intelligent networks, it is a good indicator of what we will experience over the next 10 – 15 years. The digital transformation trends of the industry, intelligent buildings, smart cities, intelligent energy grids, and connected critical power infrastructure in airports and hospitals will have similar impacts, if not greater, than what the internet had on the way we live our everyday life.

Data sovereignty

Dealing with the aspects of sovereignty (data ownership), IoT data transactions and data exchanges that are inevitable to achieve innovation and transformation beyond the level of the single organisation -and on the level of industrial markets, smart cities, and the types of connected ecosystems as described – is not an easy task.

Transformational programs which are organised on sectorial, local, national, and supra-national scales, such as the European Union’s program for a regulated data market, are being studied and developed today. Their purpose is to create the framework and safe, certified, and regulated contractual mechanisms to not just leverage an organisation’s own data – but to enable innovation and digital transformation using aggregated data and the resulting insights.

There is a new kid on the proverbial block that could solve the transactional data dimension with the same considerations of sovereignty, transactions, and safe contractual methods. That blockchain technology, which promises to be the missing link enabling peer-to-peer contractual behavior without any third party to “certify” the IoT transaction. It also answers the challenge of scalability, single point of failure, time stamping, record, privacy, trust, and reliability in a very consistent way.

Some companies are investing in innovations and programs that enable and equip their partner channels to effectively deliver on this IoT evolution. One such program is Schneider Electric’s EcoXpert™ Partner Program, which puts the business growth of its partner channel at the forefront of its mission while delivering best-in-class, IoT-enabled solutions to customers such as that offered by the EcoStruxure™ architecture and platform.

Regardless of which technologies or frameworks will be chosen for the further development of IoT and the data opportunities it offers in a value-generating way, we’ve only seen the beginning of the true potential of IoT data as we enter the next stages in collaborative and connected ways.