5 Benefits of the Internet of Things for SMBs
The benefits of the Internet of Things (IoT) have changed how SMBs approach the use of devices in the workplace. In today’s digital landscape, devices, machines, and objects of all sizes can automatically transfer data through a network, effectively “talking” with each other in real time.
Top five advantages of the IoT:
- Cost reduction
- Efficiency and productivity
- Business opportunities
- Customer experience
- Mobility and agility
For small businesses, increasing reliance on the Internet of Things represents a type of industrial revolution, with 80% of businesses currently using an IoT platform of one kind or another.
For SMBs, this surge of technology provides not only opportunities to expand their digital capabilities, but also a chance to use IoT technology to better their operations and become more productive, more protected, and more profitable.
What Does IoT Mean?
IoT refers to the way devices connect with one another within a network environment. These devices can operate any number of functions, from sensors in thermostats and factory machines to printers, TVs, and even refrigerators.
From Amazon’s Echo Dot to specialized apps for logistics, the applications of IoT in both business and personal settings are varied.
IoT adoption has increased significantly in recent years as consumers and organizations take advantage of its benefits, which we’ll go over in this blog post.
By 2025, the number of connected IoT devices in the world will be 31 billion, up from 10 billion in 2019 and 1 billion in 2010.
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How Does the Internet of Things (IoT) Benefit End Users?
The primary goal of this blog piece is to examine the benefits that IoT technology has for a business, particularly with regard to business processes and efficiency.
Before we dive into that, it must also be stressed that Internet of Things tech has significant benefits for end users that should not be underestimated.
Consider the mobility that the IoT brings to workplaces—especially for employees who have to spend time outside the office such a salespeople or technicians.
IoT is a boon for businesses operating with employees in areas like these, and employees are the first to reap the benefits. One study found that IoT implementation at scale helped contribute to improved levels of engagement from employees, leading to:
- Improved productivity
- Improved job satisfaction
- Improved performance and better serviced customers
Business Advantages of the Internet of Things (IoT)
Let’s look at several ways SMBs can leverage the future of the Internet of Things and its cutting-edge technology to improve critical aspects of business.
1. Cost reduction
The more businesses use IoT devices to streamline operations and increase profitability, the more Internet of Things technologies will be tailored to help those businesses succeed. From cybersecurity to workplace efficiency, IoT devices are already making an impact on companies’ bottom lines.
Maintenance costs can be positively impacted when IoT devices are used with sensors to keep business equipment running at peak efficiency. On-the-fly troubleshooting of office equipment catches problems before they impact staff and employees, saving the hassle and costs of large repairs.
This minimizes costly extended downtime for repairs—just one of the benefits the Internet of Things brings to your operations and maintenance workflow.
As you can imagine, this technology is extremely useful to businesses in the manufacturing, logistics, and food and beverage sectors to name a few.
There are also numerous ways to use IoT technology to favorably impact your bottom line through streamlining common working processes, a top driver of IoT investment for many companies.
What the stats say about cost reduction
Cost reduction as a result of Internet of Things implementation is most prevalent in certain industries, particularly manufacturing.
For example, a study by Deloitte found that predictive maintenance (PdM) can reduce the time required to plan maintenance by 20–50%, increase equipment uptime and availability by 10–20%, and reduce overall maintenance costs by 5–10%.
Naturally, for a manufacturer, cutting costs in this manner is exceptionally beneficial, and while these types of industries are benefitting the most from IoT adoption, there are also clear benefits for the vast majority of SMBs, regardless of industry.
This is often the case when it comes to reducing labor costs by improving process efficiencies. 83% of organizations that have introduced IoT technology have improved their efficiency by doing so, reducing their expenditures and bettering output from employees.
McKinsey estimates that activity monitoring can improve productivity by 10-12%, essentially meaning more bang for the business’ buck.
2. Efficiency & productivity
Efficiency is the basis for the kind of improved productivity that boosts revenue for SMBs.
One way to leverage the power of IoT to increase company efficiency is to use it to cut down on repetitive or time-consuming tasks. An example IoT function for this strategy would be an automated PDF conversion and creation tool that removes the obstacles to PDF editing and archiving, increasing communication and documentation speeds.
These IoT tools increase the kind of inter/intra-office communication that results in better productivity. In fact, according to a survey conducted by Harvard Business Review, 58% of companies are seeing increased collaboration through the use of IoT devices.
In the work environment, IoT can be used to optimize an office floor plan and mobilize company resources—like copiers, printers, and WiFi bandwidth—for a better workflow and a more streamlined and effective approach to management.
Finally, using big data analytics through IoT can provide an overview of employee productivity and help determine what tasks are improving the function of your business—and which are impairing it.
Big data can also be instrumental in tracking efficiency for manufacturing supply chains. You can follow delivery systems and monitor products and inventory to stay ahead of demand.
Additionally, you ensure that your hardware and software are appropriately connected to provide service without lag time to employees and customers.
What the stats say about efficiency
As we previously mentioned, many of the benefits IoT implementation delivers has knock-on effects—improving your workforce’s productivity means reducing overall labor costs.
A study by Aruba found that 46% of businesses that adopted IoT strategies experienced efficiency gains, despite the fact that only 29% expected such gains in the first place.
While those figures may seem low, it’s worth noting that many of these businesses may not have anticipated the efficiency gains they reported, and their initial intentions for implementation were more aligned with general modernization of their processes rather than a specific focus on improving the efficiency of a particular task.
In other words, the efficiency benefits gained can be unintended consequences of upgrading organizational processes, but are very welcome nonetheless.
78% say the introduction of IoT in the workplace has improved the effectiveness of their IT team, and 75% find it has increased profitability.
3. Business opportunities
While many businesses strive to access the revenue-producing power of digital services, most lack a cohesive strategy for pursuing this avenue. IoT is a game-changer in this respect, as advanced analytics, artificial intelligence, and smart utility grids make it easy for SMBs to collect actionable data needed to provide the value their customers are seeking.
These analytics provide new insights that are not only being utilized to create new business models, but completely redefining traditional industries.
For example, IoT sensors on automobiles that can track speed and driving habits help insurers optimize rates on automobile insurance. Retailers can use IoT to measure in-store foot traffic to optimize displays for maximum impact based on customer habits.
The use of IoT has so much impact on business systems that 36% of companies are considering new directions in business thanks to their IoT initiatives.
As a result of IoT’s ability to connect products and services as they relate to customer behaviors, more businesses are delivering new or updated products and services to an expanded customer base.
With more data available through IoT devices than ever before on customer preferences and product performance over time, businesses are able to use this and predict behavior patterns and needs of consumers better than ever.
4. Customer experience
While IoT technology has so far mostly influenced back-end processes because of its relatively new presence, today’s IoT has meant that omni-channel strategies have completely upended the way consumers approach their relationships with businesses.
Front-end customer engagement has become a priority for organizations as they look to engage better with their audiences, usually through IoT devices.
Customers in 2021 have an expectation towards businesses that must be met; namely that they want to be able to interact with you through their phone, whether that’s using an automated chatbot or dedicated app.
40% of consumers do not care whether a chatbot or a real human helps them, as long as they are getting the help they need.
Because of this, forward-thinking businesses are using new technology and combining it with the IoT to better serve their customers.
What the stats say about customer experience
It shouldn’t come as much of a surprise that IoT tech is having a huge impact on customer experience.
Being able to unify any internet-connected device and offer customers an experience through their IoT device of choice is a key selling point of a modern business.
This is the reason so many businesses are investing in custom apps in order to better serve their audience across any device or endpoint.
The rise of new solutions like low code have prompted 90% of IT leaders to feel that the flexibility and speed of these development environments have positioned them to improve customer experience by making use of IoT devices in virtually every customer’s pocket or backpack.
It is also important for businesses to recognize that extending key business processes to everyday IoT devices will be pivotal in ensuring their competitiveness in the future.
Consumer electronics accounted for 63% of all installed IoT units in 2020. In 2021, businesses must go to customers—and not the other way around—if they are to succeed in today’s business environment.
5. Mobility & agility
The nature of IoT technology means that businesses now have the opportunity to let their employees conduct their work from virtually any location—flexibility that can provide key advantages to SMBs in particular.
Office leases aren’t cheap, and the IoT revolution has allowed a surge in small and mid-sized businesses changing the way they operate—hiring more full-time remote employees in “work from anywhere” positions.
Such is the improvement in agility for SMBs, an estimated 43% of businesses that implement IoT policies into their organizations experience increased business agility by improving the way operational processes are conducted.
This has of course taken on a much more substantial role in the views of many in the wake of the pandemic.
Organizations have had to create remote work policies in order to meet these new demands.
Remote workers will become an integral part of modern workforces, and that appears to be something that is here to stay. Utilizing IoT technology across all your devices for communication purposes, as well as using a solid strategy for securing those endpoints, will be primary concerns for any initiatives making use of the benefits of the Internet of Things.
Benefits of IoT: Takeaways
- Businesses can use advanced IoT analytics for advantages such as improved efficiency and productivity and reduced costs.
- The IoT is producing new business opportunities through innovation as well as by redefining traditional business operation models.
- Customer experience is key for increased revenue and IoT provides ways to track customer behaviors for maximum impact.
- Businesses should safeguard data flowing to and from IoT devices for optimal security and to avoid halts in service.
Advanced technology solutions utilizing IoT tech can help companies achieve and maintain a competitive advantage in their industry. Through leveraging the tools available, you can increase staff productivity and decrease costs—your business can enjoy higher operating capacity and deliver a superior customer experience.
For more information about how tech solutions can help your SMB, download our free eBook, “Fast-Tracking Your Digital Transformation”, featuring information on data backup and business continuity, document workflow solutions, cybersecurity, and more.