How IOT & Big Data will shape up Future

Economies

Srinath Perera, Ph.DVP Research, WSO2

Member, Apache Foundation@srinath_perera

Art of War“If you know the enemy and know yourself, you need not fear the result of a hundred battles.

If you know yourself but not the enemy, for every victory gained you will also suffer a defeat.

If you know neither the enemy nor yourself, you will succumb in every battle.”

Sun Tzu, The Art of War

Information is the Ultimate Competitive Advantage

• Better Operations • New Product or better

Products• Go to market at the right

time with right product, and right message, and right differentiation

• Better Experience for the user

Premise of Big DataIf you collect data about your business, and feed it to a Big Data system, you will find useful insights

that will provide competitive advantage– (e.g. Analysis of data sets can find new correlations to

"spot business trends, prevent diseases, combat crime and so on”. [Wikipedia])

Underline assumption is that way we operate, and organizations are inefficient.

Premise of Big DataIf you collect data about your business, and feed it to a Big Data system, you will find useful insights

that will provide competitive advantage– (e.g. Analysis of data sets can find new correlations to

"spot business trends, prevent diseases, combat crime and so on”. [Wikipedia])

Success Stories• Money Ball ( Baseball drafting) • Nate Silver predicted outcomes

in 49 of the 50 states in the 2008 U.S. Presidential election

• Cancer detection from Biopsy cells ( Big Data find 12 patterns while we only knew 9), http://go.ted.com/CseS

• Bristol-Myers Squibb (biopharmaceutical company) reduced the time it takes to run clinical trial simulations by 98%

• Xerox used big data to reduce the attrition rate in its call centers by 20%.

• Kroger (Retail good chain) Loyalty program ( growth in 45 consecutive quarters)

Premise of IoT

Ubiquitous Devices connected to

internet

• Connecting real world and digital world for better data and control

• Augment the Big Data story, but make it 100x powerful

"Internet of Things, Mapping the value Beyond Hype" by McKinsey 2015

IoT can be Big• 5B devices already,

25B by 2020 ( that is 4 devices for each of us)

• $4 - $11 trillion per year by 2025/Mckinsey – all enterprise SW is about

600B in 2015 (Gartner)– 1000-2000$ per each of

us

IoT: Devices and Use casesDevices• Ad-hoc/ Home/

Consumer (Embeddables , Wearables, Holdables, Surroundables)

• Smart Systems — ( they monitor the outside world, have lot of small sensors)

• M2M/ Industrial Internet (Sensor and inbuilt, often pre-designed)

• Drones and Cameras (Never underestimate the most ubiquitous IoT device, video Cameras)

Taxonomy of IoT Use cases. https://goo.gl/iFNiYv

Use Cases

IoT Key Use Cases• GE 1% initiative

• 1% saving in Airplanes and turbines can save more than 1B$ each year (GE talk, Statra 2014)

• Walmart RFID based inventory Management

• Disney Magic Band• Progressive Insuran

ce Gadget • Smart Pill Box

Value Preposition

New Products• Drones, VR gadgets • Smart everyday things

( smart door bell/ locks, smart Owen, Glass that change based on sunlight, smart mirrors, )

• Fitness Tracker, Smart shoes

• Foot traffic sensors and location analytics (e.g. for retail)

• Health Sensors, Baby Sensors, and in home care

• Smart waste management, parking, traffic, pollution sensing

Better Products

• Digital Twin ( Stats, control e.g. via mobile App)

• Better integration with other products (e.g. Smart Home)

• Improved User Experience ( e.g. by learning how users are using the product)

• Predictive Maintenance ( Fix it before it breaks)

New Business Models• Pay per Usage

– per transportation rather than automobiles

– Pay per hour of use for expensive equipment

– Per use road tax• Dynamic Pricing

Models– sensor based auto

insurance premium – smart lighting/energy

fixtures could charge customers based on the amount of money they save

• Monetization of Data– Next slide

Data is the New Oil

• Best example is Google, Facebook ( most valued companies)

• Some operations can be justified just to get the data

• Monetize your data• Retailers could be paying

major US banks $1.7 billion a year by 2015 to send targeted discount offers to customers (Aite Group)

• Telcos send targeted advertisements

http://dupress.com/articles/data-as-the-new-currency/

Better Decisions and Operations

• GE 1% initiative • Data Driven decision • Relevant information is

made available to the right decision makers which could be people or algorithms) in a timely manner.

• ‘Good data beats opinion’ philosophy. • Question Everything• Almost everything can be

tested, measured and improved.

If you can’t measure it, you can’t improve it

Load Kelvin

See Value Proposition of Big Data after a Decade

Better User and Customer Experience

• West airline identify you by the phone number

• Multi channel ( Phone, SMS, chat all together)

• Churn Prediction and Customer Retention

Customers demand personalized, reliable and

durable products and services, at the time and in the place they want

them

General Zachary Taylor of Louisiana, US President 1948

(unpaid mail and nominations)

Better Sales and Marketing• Customer profiling,

and Segmentations, and Targeting

• Brand awareness • Using analytics for

up sell, cross sell • Social Media

analytics

How to Big Data/ IoT Wash your System in 24

hours?• Publish collect the data you

can with minimal effort ( deploy easiest sensors)

• Do lot of simple aggregations

• Figure out what data combinations makes prettiest pictures

• Throw in some machine learning algorithms, predict something but don’t compare

• Create a cool dashboard and do a cool demo, and say that you are just scratching the surface!!

Big Data & IoT Tools • KPIs• Analytics

( Batch, Real-time, Interactive, Predicative)

• Visualizations, Dashboards

• Alerts • Devices

Start Small and Solve a Concrete Problem

• Use existing Dataset: I already have a data set, and list of potential problems, and figure out how to fix it.

• **Fix a known Problem: Find a problem, collect data about it, analyze, visualize, build a model and improve.

• Improve Overall Process: Instrument processes ( start with most crucial), find KPIs, analyze and visualize the processes, and improve

• Collect All: Collect all available data, data mine the data or visualize, find interesting correlations.

Summary• Information is the

Ultimate competitive Advantage– Big Data and IoT let them get

better information faster and act• IoT with Big Data might

change the world as we know it.

• Value Proposition – New & Better Products – New Business Models– Better Decisions and Operations– Better User and Customer

Experience– Better Sales and Marketing

• Start small and solve a Concrete Problem