Digital transformation has been a hot topic in the boardroom of businesses for more than a decade, but now is the time to stop talking and start taking action. Enterprise IoT, enabled by cellular technology, is empowering companies to explore a world of possibility that previously did not exist.
In fact, Gartner expects that by 2022, 75% of original equipment manufacturers (OEMs) will use their IoT products to sell new services or consumable offerings to their customers. And, with five billion cellular connected devices working with unprecedented potential by 2025, Ericsson wanted to better understand what outcomes enterprises want to achieve through digital transformation, the challenges they face and how enterprise IoT is bringing their strategies to life. So, we interviewed 25 global OEMs in five key industries including smart metering, automotive, industrial, heavy machinery and consumer products.
We uncovered six considerations that are at play when companies make digital transformation happen in the real world – three specific to business and three to technology.
When it comes to business, the first consideration is how companies need to transform themselves to be future-proof and remain competitive through digital transformation. They also think about how to optimize performance, increase productivity and minimize costs and inefficiency. Lastly, they are considering how they can achieve sustainability goals.
And when it comes to technology, enterprises need to consider how digitalization can help automate their products and business processes, and make smart use of data. They also need to consider how they can stay ahead of threats, both physical and digital. And lastly, they are looking for technology with flexibility that allows them to scale quickly as their business grows.
We explore these considerations that are driving digital transformation below.
Additional insights including how enterprise IoT and 5G cellular technology are transforming smart metering, automotive and industrial industries and case studies from companies like Mercedes-Benz and Stanley Black & Decker are available in our latest report.
Consider your business: Transform, optimize and drive sustainability
From logistics companies to automakers, enterprise IoT helps to usher in new product and service features that not too long ago existed only in the world of science fiction. Now, they’re poised to become standard offerings.
Customers have come to expect the products they buy will be connected or “smart.” OEMs that don’t adhere to this, do so at their peril. Not only will they lose market share, they’ll miss out on the data and insights that digitalization can provide for product improvement, regulatory compliance and customer intimacy.
Since productivity and efficiency are chief drivers of most enterprise IoT projects today, the next consideration is optimization. The optimization efforts currently underway continually lead to significant benefits. Utility companies, for example, no longer need to send technicians to read or do updates on smart meters, which can save them up to $200 per meter per maintenance trip.
Sustainability is the third consideration. Driven by societal pressure and governmental regulation, digital transformation is playing a key role in OEMs’ efforts to become socially and environmentally responsible. IoT-powered logistics can help reduce the 30% of wasted food as it travels from farm to fork globally.
Reflect on your technology’s digitalization, security and flexibility
Digitalization will not only replace manual work with more accurate and efficient systems, it’s creating new business models. Uber, for example, has digitalized taxi services and ultimately aims to transform the entire consumer automotive industry with fleets of autonomous cars that make it unnecessary to own a vehicle. Even industrial players such as pump manufacturers are starting to embrace an as-a-service business model thanks to their digital transformations.
Yet, the most significant concern for enterprises is security. As they roll out connected products and digitalize operations, they not only have to protect themselves from cyberattacks, they need to safeguard the privacy of customers. And the organizations we interviewed agreed that security must be part of planning from the outset.
The final technology consideration is flexibility. The business world is in a constant state of accelerated change. So, it’s critical OEMs can launch a new product or service rapidly and that connected products on the market can scale quickly, work anywhere and be future-proofed so they’re not obsolete soon after launch.
Connecting with enterprise IoT
Connectivity is the foundation for digitalization. As products move from research to recycling – as they are developed, manufactured, deployed and decommissioned – connectivity has to be seamless.
Unfortunately, the individual stages of the product lifecycle today are typically siloed, which can lead to dead ends instead of new opportunities.
Cellular technology, including 4G and 5G, offers a compelling solution to this challenge. It can provide extensive indoor penetration to reach every device, while operating over distances for global coverage. It’s highly reliable, massively scalable and secure, having been tested in the field for decades.
Cellular maintains that vital seamless, secure and complete communication from the factory floor to the loading dock, through transport and to the product’s final destination. From there, OEMs can enjoy visibility and data continuity throughout the entire device lifecycle.
And, the promise of 5G, enhanced by AI and edge computing, opens up even more potential. Low latency, high-speed connectivity and network slicing can meet the most demanding SLAs, while facilitating success for different use cases.
The six considerations highlighted above are driving digital transformation and cellular technology is providing the foundation for the global connectivity ecosystem. To understand developments - and how to achieve real, transformative results - I invite you to read the full report.