Most of us are familiar with the internet and recognise its value in our personal and working lives and we’ve also seen its effect on a diverse range of industries.
What’s less familiar are changes currently occurring in the physical world of objects and equipment around us. Tagging, tracking, sensing, and monitoring solutions, along with telemetry and communications infrastructure are all evolving rapidly.
According to ABI Research, more than 30 billion devices will be wirelessly attached to the internet by 2020, and will comprise in part the ‘Internet of Things’. In addition to these ‘always on’ or constantly connected devices, the advent of smartphones with QR code reader apps provides for ‘intermittent’ internet connection to any suitably tagged or labelled equipment. Such a solution provides for unique identification and the possibility of interaction between the internet and the object.
This ability to identify equipment cost effectively and easily, and automatically validate location via GPS, coupled with the imagination of service providers and software designers, opens up a tantalising range of possibilities. While it’s impossible to imagine all future possibilities, it’s straightforward to foresee innovation in contract activation, equipment installation, equipment servicing, diagnostics, portfolio management, customer marketing interventions, fleet management and returns management and redeployment, not to mention product and service innovation. The adoption of such solutions also provides opportunities to reduce fraud, operational risks and risk costs.
The management of the information and data that become potentially available could provide great competitive advantage for manufacturers, service providers and lessors. New business models will evolve that cut operating costs, enable greater customer intimacy and understanding, and provide lower total cost of usage solutions, especially through optimised equipment usage.
Such approaches will require and catalyse a step change in the detailed asset management information needed to provide future services and solutions. The availability of this asset management information will in turn open up a huge range of solutions and options for equipment re-use that were not previously available.
The component pieces for this vision are available today and there is no technological leap necessary to make this a universal reality. New technologies are close at hand which will further simplify engagement and reduce price points, but the possibility to interact cost effectively with a huge diversity of equipment and assets is already a reality.
Several corporations already recognise the potential for their industries and are investing heavily in the area – the asset finance industry should take note as the "Internet of Things" could transform our business.
Ian Robertson is a principal of Invigors Asset Management