Emerging Technologies

IoT: The Business of Things

Oracle Internet of Things cloud services integrate devices and help organizations build on data in new ways.

By Mike Faden

May/June 2017

Discussion of the Internet of Things (IoT) often focuses on new connected devices—whether they’re cars, automation systems, or home appliances. But for enterprises looking to derive business value from IoT, connecting devices is just the first step. The real opportunities—and challenges—lie in capitalizing on the unprecedented torrents of data generated by those devices. That requires integration with other enterprise applications.

If we can connect to a car that’s hurtling down a highway at 80 miles an hour, we can connect to pretty much any IoT device.”
–Romil Bahl, CEO, Lochbridge

“At Oracle, we look at the real value of IoT as much more than connecting sensor-equipped physical devices,” says Harish Gaur, senior director, product management, Internet of Things at Oracle. “The devices are a prerequisite, and all the devices need to be smart so that they can send and receive information. But the real value comes from making sense out of this data, from creating insights out of this data, and taking actions based on this data.”

Monetizing Data

Forward-looking organizations are taking notice. “Companies tend to think about the devices. But what starts as a device play soon becomes a data play,” says Romil Bahl, CEO at Detroit, Michigan–based technology consulting and services provider Lochbridge. “IoT leads to data—and there’s value to be harvested from that data.”

Indeed, Bahl views the rise of IoT—especially connected cars—as an opportunity to drive revenue growth and transform Lochbridge’s business. Lochbridge has a long history of involvement with IoT: the company helped a leading automotive manufacturer pioneer its connected-car offering by helping to develop the product’s service-delivery platform.

Now, Bahl plans to use Lochbridge’s connected-car expertise to fuel an aggressive expansion plan: the goal is to double the company’s revenue by 2020, while delivering a return on investment of at least 400 percent to its customers. “Our vision is to capitalize on this capability set, starting with the core automotive space but then expanding more broadly into the field of IoT,” he says. “If we can connect to a car that’s hurtling down a highway at 80 miles an hour, we can connect to pretty much any IoT device.”

Lochbridge has used on-premises software, including Oracle Fusion Middleware, to deliver software in the connected-car space and for its nonautomotive clients as well. But for new services, the company has fully embraced the cloud. “Our internal strategy is to leverage the cloud for everything,” Bahl says. “For example, we don’t have an on-prem test and development environment. Everything’s in the cloud.”

Key advantages of the cloud include drastically reduced application provisioning times and operational costs, Bahl says. Just as important, Oracle’s platform-as-a-service (PaaS) products help Lochbridge develop and deploy new services more quickly.

Notably, Lochbridge has constructed its strategic IoT intellectual property, called the IoT Acceleration Framework, using Oracle Internet of Things Cloud Enterprise, which provides built-in capabilities to connect different devices, analyze data, and integrate with other cloud-based and on-premises applications. “Out of the box, Oracle Internet of Things Cloud Enterprise provides the basic building blocks required to connect devices and then gain insights,” Bahl says. “That obviously helps us onboard new customers quickly. Because the Oracle platform enables device integration and management, it enables us to focus on solutions built on top of that platform.”

The real value comes from making sense out of this data, from creating insights out of this data, and taking actions based on this data.”
–Harish Gaur, Senior Director, Product Management, Internet of Things, Oracle

The ability to integrate with other enterprise applications and share intelligence is critical, adds Raj Paul, vice president of IoT and connected services at Lochbridge. “Our view of the world is that IoT brings a ‘sixth sense,’” he says, “so obviously, seamless integration of that sixth sense into the enterprise is important.” To build its services, Lochbridge is combining Oracle Internet of Things Cloud Enterprise with other PaaS services from Oracle, including Oracle Database Cloud Service and Oracle Java Cloud Service. The company also uses Oracle Big Data Cloud Service for applications involving complex analysis or regression modeling.

“It’s very easy for us to implement all plausible use cases by having both Oracle Big Data Cloud Service and Oracle Database Cloud Service,” Paul says. “That is one of the primary reasons we went with this deployment strategy, so that we could keep things open.”

Using Oracle’s cloud products, Lochbridge is building IoT services designed to drive specific business outcomes for its customers, such as customer loyalty and product quality, Bahl says. An example is the company’s diagnostics-as-a-service offering, which tracks a device’s health, identifies potential problems, and sends alerts and service reminders. “We’re able to proactively send messages to customers about the need to get to the service center for maintenance or to the manufacturer/OEM to dispatch service personnel to the customer,” he says. “We can send them a health report that aggregates information from multiple sources to gather insights about the status of the device, and then tell them everything from a part’s system status to ‘there’s an issue with this part and you need to go in or get an upgrade.’”

Lochbridge has created analogous services for companies in several industries, including a mining company that needs to monitor and diagnose the overall health of equipment deep in its mines and a utility company that monitors the devices on and utilization of its grid.

“There’s tremendous value in being able to gather data on usage patterns and send customers proactive reminders when maintenance issues seem to be emerging,” Bahl says. “Now you’re talking differentiation. You’re driving loyalty. And you’re gathering a ton of data to improve your products, which over time reduces your warranty and repair costs.”

Another Lochbridge service enables usage-based car insurance. The service, which Lochbridge is building on Oracle’s IoT cloud platform, uses data from vehicle sensors to help insurers calculate premiums based on how people actually drive. The new service is the latest of several generations of risk-based insurance systems, Bahl says. Each generation has provided more-sophisticated risk analysis by analyzing greater amounts of data from a car’s 200-plus sensors and other sources.

“The first generation was based simply on how many miles you drive,” he says. “The second generation added driver behavior to the mix: Are you turning abruptly, or are you screeching to a halt too many times? And the third generation can score a driver based on hundreds of data elements—not just how you’re driving, but also external factors. So, yes, you braked pretty hard, but there was an ice storm or other reasons for that.”

Manufacturing Value

At Noble Plastics, enterprise IoT involves devices that are considerably less mobile than cars, but just as complex and challenging: robot-managed manufacturing systems.

Based in Grand Coteau, Louisiana, Noble helps companies turn their ideas into products by offering design engineering services, contract manufacturing based on injection molding, and automation systems. Noble applies its expertise to a wide variety of products, from smart munitions used by US special forces to the paddles in margarita machines.

To maximize efficiency, Noble typically runs its manufacturing cells unattended, so they can operate 24/7. A typical cell includes injection molding machines, auxiliary monitoring systems, and a Fanuc robot that supervises the process and also handles the finished parts. Vast amounts of information, including parameters such as the molding machine pressure and temperature, are collected during the manufacturing process.

Scott Rogers, technical director at Noble Plastics, wants to analyze that information to improve the process, potentially reducing the time it takes to make each part and improving product quality. “If we can reduce our manufacturing cycle time, it’s a huge deal for our customers—and for us,” Rogers says.

If we can reduce our manufacturing cycle time, it’s a huge deal for our customers—and for us. ”
–Scott Rogers, Technical Director, Noble Plastics

To achieve that goal, Noble plans to use Oracle Internet of Things Asset Monitoring Cloud Service, a software-as-a-service application built on Oracle Internet of Things Cloud Enterprise that monitors assets and provides real-time visibility into their health and utilization, facilitating predictive maintenance. Rogers also plans to integrate that application with Oracle Mobile Cloud Service to achieve another of Noble’s goals: a more robust alerting system that informs the company’s technicians when problems occur, so that they can respond quickly.

Rogers aims to use Oracle’s cloud-based analytics tools, including machine learning, to automatically analyze information gathered from the robot and process-monitoring systems. These analytics could help Noble identify ways to reduce cycle time, improve the manufacturing process, enhance product quality, and cut downtime. In addition, Rogers says, “we are hoping to be able to take that information and push it back down to the robot, so that it can make even more-intelligent decisions.”

For Noble, the fact that Oracle’s IoT services are cloud-based is crucial. With fewer than 30 employees, the company can’t justify adding specialists dedicated to managing and updating on-premises IT systems or to analyzing data. With cloud-based software, the vendor is responsible for ensuring a high level of availability and keeping applications up to date, Rogers notes.

Cloud-based software also simplifies the process of monitoring and managing Noble’s two manufacturing locations. The machine learning capabilities allow Noble to identify trends and patterns in the data without having to do time-consuming manual analysis. In addition, Rogers sees opportunities to offer enhanced data analysis and other capabilities to customers of Noble’s automation systems.

We’ve Only Just Begun

As Lochbridge and Noble Plastics demonstrate, enterprise IoT involves much more than gathering information from connected devices. The ability to analyze and integrate the data with data in other applications is critical.

“Eventually, the number [of connected devices] is going to be so high that the amount of data coming from these machines will be just mind-boggling,” Oracle’s Gaur says. “And what we do with that data—how we take that data up and work it into actionable information—is the real goal.”

Oracle Internet of Things Cloud Enterprise enables high-speed data transfer and real-time analysis, but it relies on other applications to drive further actions, he says. As a result, companies are typically taking advantage of the platform’s built-in integration with other applications and services, such as enterprise resource planning and customer relationship management software, Oracle Mobile Cloud Service, and Oracle Big Data Cloud Service.

As Lochbridge CEO Bahl sees it, the integration of IoT into the enterprise holds enormous possibilities that businesses are just beginning to explore. “What’s really exciting about all of this is that the journey on monetization of IoT has just begun,” he says. “The next 10 years will be hugely exciting in terms of the insights companies can gain into their end consumers and how they use those insights.”

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Photography by Jussara Romao, Unsplash