There are big things coming in the next ten years, if technology companies are to be believed. How will this impact us, the consumers? CBR spoke to Mike Riegel, Vice President of Internet of Everything, Cloud, & Services Marketing at Cisco about what to expect.
What do you expect from the IoE in the next ten years?
We’ve always had a point of view that it’s not about the things. The industry is all worked up about the things, but the things are strictly a tool. It’s the connection of the people, the process, the data and the things that really matters. Between now and 2025, what’s going to happen is more and more industries are going to move into taking advantage of it because the benefits are going to start to line up.
The reason that healthcare is one of the early adopters of the Internet of Everything is that if you can connect an individual’s health record to the hospital to the emergency provider to the doctor you can improve the customer experience, make sure you have more accurate data and probably save their life a little faster. It’s pretty easy to make the case for investing in the IoE for healthcare.
The same is true in retail; I had a meeting with the CIO of one of the big fast food [outlets] in the US. He started with a loyalty app. That was easy, connecting the people to the data. Once he did that he began to realise how much more he could do. He could get their purchase history and start to change his supply chain. When they walk in the store I can recognise them and offer them promotions that let them buy more.
So if he can improve the customer experience in the store, improve his supply chain and have better targeting of demographics, that’s three different benefits. The technology is going to continue to accelerate and I can’t predict the technology, but by 2025 there will be more industries that clearly understand the use-cases.
What effect will that have on companies’ processes?
If you understand how processes are done today in companies in particular, it’s very hard work. It’s always hard-scripted and very difficult to change. If you implement SAP and then you want to change it, well good luck. You’re going to have to get another million dollars out and six more months.
All of that eventually is going to go away. Everything is going to be light-weight apps, the type of apps that you have on your phone which are 20 Mb not 2 terrabytes. There are going to be purpose-built apps for every step of the process.
Retail banking is a good example; most major banks in the US you can now deposit a cheque with your phone. That’s a purpose-built app for depositing a cheque, which actually might sit inside the loyalty app of the bank but actually inside it’s just a very small piece of code that takes a high quality picture and sends it to a certain place in the bank.
More and more that’s what we see happening with corporations is these lightweight apps that are much more agile and therefore easier to integrate to banks, retailers and hospitals. I think that’s one of the big ones that we think we have a unique view on this because most of the large software and hardware vendors are still investing in the traditional method.
Can you give an example?
We’re working with Bank of America, the big bank, because they’ve realised that their end process for giving you a loan on a house is too long in time, it has too many steps and it has a lot of paper.
They lose about 50 percent of people in the funnel. The last house we bought we actually went to three different banks over the phone. They all had the same rate so [we went with] the one who got back to us first, who had the best customer service, who offered the deal with the least amount of paperwork. With the Bank of America we’re going to digitise their whole process.
You’re not going to have to go into the bank any more, you can do it over Skype video. You can send in pictures of documents using your phone. By digitising the whole thing down to about seven steps, not only can we simplify the time and the steps but their satisfaction has gone up and their yield has gone up. That’s an example of a big process in a big regulated industry that you can digitise and transform.
What can we expect from the combination of connections?
What’s interesting is for Cisco, just like we connect all the phones and IP, and we connected the internet and IP, and now we’re connecting the InterCloud, it’s going to be the same thing with the IoE; it’s the sum of the connections that will increase the power.
What we find is there’s so much fixation with things, whereas actually the more you get the four things together, the more combined power you get: the combination of the people, the process, the data and the things. Particularly on the data and the analytics side, the amount of data being generated by phones and sensors is way beyond what anybody could ever predict and will continue to be that way.
So the question is not only how do you change your process but you also have to start thinking about the data at the edge, which is why we’re so focused on the analytics at the edge. There’s no way that you’re going to take all of that data being generated by your customer and your supply chain and put that back in a big database. It’s not tenable, it’s impossible to do.
We did an interesting example with a big auto manufacturer where we put video analytics in the dealer’s show room. They thought they knew who was spending time at this car and who was spending time at this car in terms of demographics.
But they were saying we want to be data-driven, we don’t want to just guess and we don’t want to ask our sales people what they think. So we put video analytics in the room, a video camera with analytics, and through the video they can deduce how old you are, other demographics about you in terms of your sex and how tall you are.
We can then use mobile analytics, when you go into the showroom and connect to the wi-fi we can actually get your ID off your phone and determine how long you stood by this car and how long stood by this car. We can take that wait time and say, on average, the people who went here were 25-32, mostly female, and the people who went here were 38-40, mostly male.
We can put the same thing in the parking lot and say they looked at these cars in the showroom, but they went out into the parking lot did they buy one? Did they go to the same ones or did they go to different ones? That’s huge. Because the dealer can start to say, maybe I’ll add a third car that’s a good cross-saw between them.
It’s all data-driven whereas before they had no idea. They thought they knew, but it turns out they were completely wrong; they thought the females were going here and the males were going here and it was the opposite.
That’s the a-ha moment. When we showed them that on Monday, and this is what you want in business: they didn’t say how much does it cost, they said how soon can we get it? How soon can we get it in all of our dealers, because it’s going to make a big difference. That’s a good example of data being a driver of the insight.
If they’d taken all of that data and sent it to corporate, put it in a big data depository and then a month later got a report on customer segments, by then the cars have changed. So that’s a good example of real-time analytics at the edge and how that can really drive a difference in business.
Does this mean as a society we’re going to get better products?
One of the other things we can do is, we actually have the technology available now in our mobile experience software that you can run on these, that when you walk up to a fast-food store or drive up to a drive-through, we can actually have the digital signboard customised to you. If I drive up in a minivan on a weekend with my kids to McDonalds, the signboard will change to show family happy meals and the big order I get at the bottom.
Very different from no customised experience. By doing that, it would be very easy for them to say, ok, here’s Mike’s menu board, let’s add in two dessert items and see if he buys them. You can do all of that customisation to do classic market testing that leads to the better products that you’re talking about and the customisation. I think that’s where a lot of opportunity will be, particularly on the sales side.