By Eimear Dodd, freelance journalist/writer

Some insights from Dr Alex Bazin, Vice President Advanced Technology Division Fujitsu who spoke with us recently about IoT at the Fujitsu Forum in Munich. The interview has been lightly edited and condensed.

Can you tell me a little about your role within Fujitsu?

I’m responsible for bringing new technologies to market for Fujitsu. I sit within our global organisation where I support all of our regions, all of our countries to deliver new technology services to our customers. I spend a lot of time working directly with customers to help understand their business challenges and to see where some of the investment we’ve been making in research and development can be brought to bear on a specific problem.

As IoT has been maturing, I’ve seen that one of the things we really need to do is start treating IoT as an extension of mission-critical IT. Fujitsu has run customers’ mission-critical IT systems for decades and as IoT becomes mission-critical to our customers’ businesses, we need to have the services and support capabilities to help them. That’s another thing that my team has been building to make sure we can support our customers.

What are the opportunities in the IoT space?

Kind of limitless. What I’ve seen is that the initial attraction to IoT for a lot of customers is improvement in operational efficiency. This might mean improving factory uptime and productivity. That’s a really great thing and it has clear business benefits. The straightforward end of IoT is improving efficiency and customer responsiveness.

Where I think the opportunity lies over the next three to five years is really the transformational change that will allow new business models for industries to emerge. Take manufacturing for example, IoT gives you the ability to create bespoke products for individual consumers but at a cost similar to mass production. You can start doing that with much more automation in your factory. It’s this transformation that will turn manufacturers into service providers. Rather than selling aircraft engines, you start selling aircraft engine hours. You start being able to respond in different ways and I think that’s going to be a disruptive force within many industries.

Is the change that IoT brings likely to be less visible to the end customer?

I think the technology won’t be as visible but the way that customers will start interacting with suppliers will be different. We’re already seeing this with the way that people consume media; we’ve started moving from a purchase economy to a subscription economy. I think we’ll start seeing that more and more with manufactured goods as well. Think about autonomous vehicles, it’s still a little way off but does the business model really make sense that I go and buy an autonomous vehicle when we know in Europe that a private car will sit idle 92% of the time? If I can start buying mobility as a service and I subscribe to an autonomous car club, that suddenly starts making much more sense for me as a consumer. An autonomous vehicle is still going to sit idle 92% of the time because I’m at work or at home.

That causes quite profound changes to the way that certain industries operate. I think that’s the really exciting part of some of these IoT and AI revolutions. It doesn’t just improve efficiency and the way that we live our lives. It actually does fundamentally shift the cost base and how we consume goods and services.

And is disruption one of the challenges of IoT?

I think that established businesses need to think about how their existing business model survives in an era where technology is much more prevalent, where consumers can engage more directly with brands and where consumers can engage directly with producers rather than through intermediaries.

I think there are companies that are digital natives that will be building the products and services of the future. Established brands are now looking at how they change their businesses to react.

What do you see as the other challenges within IoT?

I think the fundamental challenge that has slowed the adoption of IoT so far has been building robust business cases. A lot of the initial hype around IoT was quite technology-led. When working with our customers, we start by identifying their core business challenges that technology might be able to help them with and how to measure that value as we go through an IoT project. This helps our customers build a business case. I think that’s one area where the industry is getting better but it’s taken a while to be more business-led than technology-led.

Security’s still a big topic of conversation within the IoT world. I think it’s fair to say that the consumer IoT world has been more hard-hit by some of those security challenges and I think there’s good work going on to address many of those. Part of the challenge is if you have a laptop, you might only have that laptop for two or three years. You probably also change your smart phone every couple of years. However, some of these IoT devices that are going into our core infrastructure are going to be in that infrastructure for ten or 20 years. As an industry, we need to think about how you manage and support devices over that long lifespan. That’s an active topic of research. We’ve been doing a lot of work on that.

I mentioned the third challenge earlier around how we build services that make sure we’re maintaining these as mission-critical systems. If your whole manufacturing approach has changed to being always on, real-time and responsive to customer demand, then you’re much more sensitive if something isn’t operating 24/7. Suddenly you’re not able to fulfil customer orders, so being able to treat these systems as mission- critical systems and have the service and support around them is something that is coming. That’s a challenge that we’ve been working on with our customers.

On the theme of digital co-creation, is collaboration with customers a big part of developing IoT initiatives?

Yes, because every customer is different and the challenges they face are different. They all have their own special mix of legacy IT systems and operational technology that might be ten or 20 years old. It’s still perfectly serviceable and does exactly what they need. That requires a certain engagement with the customer to understand their problem. Then we extrapolate from other projects we’ve done in those industries and say okay when we’ve tackled this with a customer like you with a similar set of problems, this is how we’ve done it. This is how we can then bring our knowledge to bear.

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