The business benefits of machine to machine
Summary: CIOs, other IT leaders, and management are beginning to wake up to the potential of machine-to-machine communications to deliver real business benefits.
Machine to machine (M2M), the automated communication of data between connected devices, has begun to increasingly capture the attention of CIOs across the globe.
The technology is moving beyond its decades of use in utilities, transport, and heavy industry into the mainstream, empowering CIOs to deliver real value, cost savings, and innovation to management and their wider organisations.
Now that networking equipment — a simple SIM card or RFID chip, in the case of M2M — and wireless carriage have dramatically decreased in cost, and wireless coverage, speed, and capacity have increased, we can now embed connectivity into the "things" we use in our day-to-day lives. That translates to new business intelligence (BI), operational efficiencies, and revenue-generating opportunities.
In the transport and logistics sector, this means that pallets and packages are able to communicate their location, allowing for real-time parcel tracking. The same application of M2M also allows the public to gain real-time updates on how far away their train, ferry, or bus is.
In the healthcare sector, M2M devices worn by patients enable real-time monitoring of vital statistics or the dispensing of medication. In retail, M2M provides better point-of-sale data, as well as better shopping experiences through personalised digital signage.
In the utilities sector, too, M2M powers innovation through smart meters in homes that provide near-real-time data to consumers on their usage. M2M devices are also deployed throughout power, gas, and water networks, which allow for better visibility on outages, spikes in demand, and supply routing.
With this communication, machines can be set to act against existing business rules or parameters, or to feed data through to humans, empowering them with greater awareness and insight into business and systems operations.
Because of the improved visibility, they only need to go where the attention is needed. That has a hard ROI for operations.
Just ask Michael Klausen, co-CEO at Brasserie Bread and an M2M convert. Until early 2011, the company — which bakes and supplies artisan bread and pastries to more than 500 restaurants daily — was reliant on labour-intensive and "100 percent unreliable" paper-based processes to meet its temperature-based food-safety compliance requirements.
Faced with the potential loss of health accreditation and the ability to supply specific shops, hospitals, schools, and airlines, Brasserie Bread turned to M2M. The project combines kit, carriage, management tools, software, and services from cold-chain specialist Cooltrax and Telstra. With it, the company has automated temperature readings and compliance reporting, and can now access real-time alerts in the advent of a cool-room unit failing — saving the potential loss of the next day's bake.
"I can now sleep at night," Klausen said of the benefits of the project. "I can sit at the airport and quickly run a check on where temperatures are at in the two bakeries. From a management point of view, that is a lot of time saved for me."
There's also the saving of a staff member whose sole role is to manage and monitor food temperatures.
M2M: The value
It's not just management that's beginning to realise the benefits of M2M; it's CIOs, too. Telsyte senior analyst, Rodney Gedda, said that this is because M2M can, in many instances, be tied back to a hard return on investment (ROI), as well as helping to deliver back to the business stronger BI, driving customer engagement, cost saving, business process efficiencies, innovation, and potential new revenue streams.
"If a machine or device can report back that it has broken down or that it needs refilling, then that saves, for example, a field-force employee driving around checking on these things," he said. "Because of the improved visibility, they only need to go where the attention is needed. That has a hard ROI for operations."
The combination of M2M and big data, as automotive company Ford pointed out, could produce excellent everyday benefits in the not-too-distant future. Collecting data — from a small-scale fleet of repair trucks through to a million-strong network of smart meters — then feeding that data through a processing system to deliver detailed business information is another major benefit of M2M.
"That could be used by an electricity provider to gain very detailed information on when spikes in electricity demand occur, and what usage patterns are, whether there are more optimal distribution paths, whether there is or has been an outage in a certain area, whether there is maintenance needed," Gedda said. "That kind of information is delivered through M2M, and has a powerful effect on how well your business operates."
It is really about a better user experience, and, for the service provider, it is a deeper service and relationship.
King Yew Foong, research vice president, communications service provider (CSP) strategy at Gartner, said that M2M is also being used to drive closer customer relations. Through enabling new cars with M2M, automotive manufacturers and dealers are able to actively inform customers of when tire wear is occurring, or when engines or other components are failing or due to be changed.
Similarly, office equipment that's outfitted with M2M — such as a multi-function printer (MFP) — can keep track of component wear and ink-cartridge use. When the time is right, it can automatically order a new cartridge, or request that a technician be dispatched to give it a service.
The result is that M2M can help deliver a painless service, or create the sensation that the service supplier is actively engaged in the customer relationship. "It is really about a better user experience, and, for the service provider, it is a deeper service and relationship," Foong said.
