McKinsey believes that the value of IoT is set to accelerate, delivering significant economic potential. The company believes that by 2030, it could enable up to $12.6 trillion in value globally across multiple settings that include manufacturing, healthcare, business-to-business (B2B) applications, and more.
However, the firm does highlight that there are limitations to uptake and adoption that need to be overcome for the organisation to fully realise the potential of IoT.
This is a view shared by Charlene van Onselen, Executive Committee member of the IoT Industry Council of South Africa (IOTIC), who believes that IoT is a promise that’s slowly starting to move beyond lip service and into delivery, but that needs greater support to truly shine.
“We’re already seeing an increase in connected sensors and the ubiquitous use of IoT applications,” she says. “Over the past few years, we’ve started using improved, cheaper and more pervasive technology that allows for organisations to connect even more things and in ways that deliver even more value. Despite some false starts and slow beginnings, IoT is rapidly proving itself to be the tool that the organisation needs to create intelligent decision-making systems that improve quality of life and workplace.”
IoT is forecast to reach an installed base of 30.9 billion connected devices by 2025 which is a steep increase from the estimated13.8 billion in 2021. It’s rapidly spreading into consumer devices, into applications across smart cities and smart homes, and into intelligent industrial automation and control. It has sparked innovation and ingenuity, and it has moved past the hype and into proven functionality. And yet…it has not yet soared to these numbers in South Africa.
“IoT and the creation of relevant data have not yet become the key performance indicators (KPIs) that business executives in South Africa, nor has IoT grown as a market as it should have,” saysvan Onselen. “This is largely due to limited knowledge and understanding of what value the market can get from using IoT to solve real problems, and to limited awareness around how this technology can be realistically applied in this space.”
The lack of understanding and confidence in IoT have been two key challenges. Companies are unaware of IoT use cases or can’t quite visualise how the technology can be applied to their unique situations. This is compounded by the rapid digitisation of organisations post-pandemic – most have realised the critical importance of embedding digital within the business to ensure resilience and are still coming to terms with what this means and how this can be effectively managed. Plus the tough economic conditions influencing overall technology investment and uptake have to be taken into consideration in Africa.
“There is a need for increased collaboration between ecosystem players to improve knowledge sharing and to create new working models,” saysvan Onselen. “This would potentially allow for ecosystem players to reduce the cost burdens and then diversify and create scale. And it is worth noting that the economic complexities that have put pressure on the local landscape have had the default positive outcome of forcing companies to act fast and innovate quickly which is pushing the increased adoption of IoT technologies.”
The challenges have meant that IoT innovation within this market has stagnated somewhat and that companies surging ahead with remarkable solutions have been held back by poor local uptake and understanding. However, this is slowly turning – like a barge pushing a cruise ship, IoT is slowly pushing its viability onto the awareness of the decision maker. One of the reasons for this change is the rise in good news stories and case studies that are showcasing the true potential of IoT, and how global companies have benefitted immensely from its functionality.
“Both locally and abroad, those users who have taken a leap of faith and implemented IoT solutions are experiencing measurable and positive change in their businesses,” she says. “In some sectors, South Africa is leading the way on the global stage because some companies are innovating and using available solutions faster than others. There has also been a shift in awareness around the value inherent in IoT network technologies such as SigFox, LoRA and NB-IoT and there has been a rise in the number of sectors that have realised tangible value from IoT implementations within the business.
“The South African market is currently showing success in the utility sector with smart solutions in water and energy management that have the potential to change how municipalities and homeowners manage their consumption and risk,” concludes van Onselen. “These gains are echoed in the stolen vehicle recovery sector and the security sector and all are combining to move South Africa further down the IoT path than ever before.”