All You Need To Know About Business Models in Digital Transformation

In very simple terms, the Business model is how you plan to make money from your business. 

A refined version is how you create and deliver value to customers. Your strategy tells you where you want to go and the business model tells you how you are going to do it.

In this time of industry 4.0 with Digital Transformation, businesses are getting disrupted faster than they get established. We all know what Apple did for music, Uber did for taxis and Airbnb did for hotels.

Digital is helping them to enhance their existing products and services and helping to launch new products and services.

Companies are using various business models to be successful:

• Freemium model: Basic products/services are provided free but users are charged for advanced features. E.g. Coursera, LinkedIn, Spotify, Dropbox, Skype
• Pay as you go or Subscription Model: Pay only for services which are used. E.g. Netflix, Kindle, New York Times, Safari Books online
• Customer experience model: provide the customer experience never before e.g. Tesla, Disney Land, Apple
• On-Demand model: provide customer service on demand with speed. E.g. Uber, cloud services from Amazon, Microsoft
• Marketplace model: provide a platform for buyer and seller interact with each other directly e.g. eBay, Alibaba
• Free model: provide the typical services to users free and sell their behavior data to different businesses e.g. Google, Facebook, PatientsLikeMe
• Crowd-sourcing model: receive money for an engaging crowd for a common goal, innovation, problem-solving. E.g. Kaggle, CrowdAnalytix
• Bundling model: selling similar products or services together. E.g. Microsoft Office        
• Gamification model: use of game like feature to simplify the interaction. E.g Mint.com, Khan Academy, Nike +

 

Some of the big companies moved on from their core business model and adapted to the change embracing digital to get closer to customers in real time and grow exponentially.

Nike had moved on from a sports apparel company to fitness driven personalized wearables like FuelBand manufacturer.

Amazon started in 1995 as an online bookstore but went on to become a leader in technologies like Cloud, Drones, web services. 

Philips started as Light Bulb Company and moved on to become the leader in healthcare equipment’s touching millions of people lives.

GE has moved forward from its core industrial products – from jet engines and gas turbines to CT/PET scanners, locomotives with sensors that monitor various parts of the machinery. They developed their own Predix IoT platform with advanced analytics to provide real-time information to improve efficiency, increase productivity, and schedule more effective preventive maintenance.

Apple adopted multiple models from PC manufacturer to selling online music, to subscription model of iCloud.

Changing the business model drastically may not work. Don’t try to boil the ocean but start with how you can deliver greater value to customers through digital technology.

Success in choosing one business model over another will depend on how well companies understand their customers’ needs. 

How Industrial Internet of Things are impacting our lives

General Electric coined the term Industrial Internet in late 2012. It is effectively synonymous with the Industrial Internet of Things and abbreviated as Industrial IoT or IIoT.

While many of us are familiar with the Internet of Things used by Nike+ FuelBand, FitBits, Hello Barbie, Nest and Samsung Fridge as connected devices, there’s much more going on in connecting industrial devices in the world of IIoT.

The Industrial Internet is still at an early stage, similar to where the Internet was in the late 1990s. The IIoT, through the use of sensors, advanced analytics and intelligent decision making, will profoundly transform the way field assets connect and communicate with the enterprise.

Industries impacted by IIoT are Manufacturing, Aviation, Utility, Agriculture, Oil & Gas, Transportation, Energy, Mining & Healthcare.

One of key opportunity that early adopters of the Industrial Internet are pursuing is the improvement of worker productivity, safety and working conditions.  Using drones or flying robots to monitor oil pipelines, chemical factories etc.

The IIoT will revolutionize manufacturing by enabling the acquisition and accessibility of tons of data, at lightning speeds, and far more efficiently than before.

A number of innovative companies have started to implement the IIoT by leveraging intelligent, connected devices in their factories.

• GE’s latest locomotive has more than 250 sensors that measure 150,000 data points per minute giving location, weight, speed, fuel burn etc. for trip optimization,  remote diagnostics, and yard planning.
• Rolls-Royce’s TotalCare provides a suite of predictive maintenance and repair services for its jet engines, including monitoring engine health, and modifying engines to increase reliability and durability.
• John Deere is building intelligence into its large combines, tractors, and sprayers through sensors that make the machines into mobile platforms.
• Amazon now operates one of the world’s largest fleets of industrial robots in its warehouses, where humans and robots work side-by-side, capable of fulfilling orders up to 70% faster than a non-automated warehouse.
• Rio Tinto, a global mining company uses a remote command center to orchestrate the actions of huge drills, excavators, earth movers and dump trucks across multiple mining sites.
• Airbus has created a factory of future with IIoT, to track and visualize production process in real time.
• Marathon Oil, at their refineries, employees wear a wireless multi-gas detector. This helps them by tracking their exposure to dangerous gases

With industrial internet of things, leading companies are improving operations, lowering costs, improving the safety of workers.

Data generated by industrial equipment like Turbines, Jet engines and CT/MRI scanning machines when combined with big data analytics will give tremendous value to the business.

IIoT & Big data analytics will change the game of competition while there are challenges like data security & interoperability in existing systems which have to be resolved.

To speed up the development & accelerate the innovation in IIoT, the Industrial Internet Consortium was formed by GE, Cisco, AT&T, IBM and is over 250 members from 30 countries.

The path to Industry 4.0 is via Industrial Internet of Things (IIoT) and is boosting the Digital Transformation in many ways.

Digital Transformation helping Smart Cities flourish

A smart city is simply a community that harnesses digital technologies, such as Internet of Things, Big Data Analytics, Mobility, Drones & Wearables to improve the quality of life of people, optimize available resources such as electricity, roads and water in economically sustainable manner, and reduce environmental pollution. 

They are run just like businesses to with smart and user friendly services.

In smart city, IT is the major factor and the basis for providing essential services to residents. Smart Cities depend on data available to them from all the above technological advances to enhance the quality and performance of their services.

Smart Cities integrate and analyze massive amounts of data to anticipate, mitigate, and even prevent many problems. This data is leveraged, for example, to intelligently reroute traffic and reduce accidents, identify crime hot spots and target resources for crime reduction, and connect citizens at work or out on the town.

Younger people expect to have the city in their pocket — to find a cab, locate the next bus, find a nearby restaurant or event, report a pothole or broken streetlight, apply for their driver's license, or tweet to their government representatives. They want consistent, personal service via their smart device.

Here is what future smart city can give you:

• Smart Traffic: Connected car sensors collect valuable real time data about traffic density and report it the control center, allowing to adjust traffic light sequences intelligently, as well as apply manual corrections whenever necessary.
• Smart Parking: Integrated with municipal Buses and private car owners, to build a highly efficient parking system.
• Smart Energy: Automatic lighting control, may vary from obvious night-time auto activation to dimming based on crowd density and weather conditions. Every home will have a smart meter to control the power usage and report in real time.
• Smart Buildings: Facilities including power management, lighting, physical security, fire safety and IT infrastructure.
• Smart Safety: Firefighters wearing sensors that let them know if the CO₂ in a building has reached lethal levels. Grid of connected CCTV cameras to ensure public safety. Air quality sensors detect pollution peak and warns people who are subject to allergies through their smartphones.
• Smart Charging: There are charging stations by the side of each road for electric vehicles, drivers can pay by flashing their wallet or even contact less payment.
• Smart Advertising: Personalized digital signs for people passing by.
• Smart Water System: IoT sensor enabled water systems which measure the flow, pressure, level and chemical content of the water to improve quality and usability
• Smart Views: Use of augmented and virtual reality to help people indoor and outdoor navigation.
• Smart Access: Users can open car doors or office doors by just touch of finger or even with IoT enabled sensors ensuring doors are opened when users are approaching
• Smart Commute: Connected cars and trains giving personal entertainment based on Big data Analytics insights.
• Smart Planet: Special lanes for bicycles for health conscious commuters helping zero carbon footprint

New York, London, Paris, Columbus Ohio, Dubai & Barcelona are the examples of smart cities around the world.

Smart Cities bring multiple rewards like better control of public spending, more engaged citizens in local development, improved performance of public transportation systems, lighter traffic and a reduced carbon footprint.

Smart Cities innovations have come a long way. All these digital technologies are future. Someday will come, to make Captain Kirk’s “Beam us up scotty” catchphrase true.

10 ways Drones are making entry into our lives !!

With Digital Transformation so many technologies are coming to reality in our lives.  

One of them are Drones, typically known as Unmanned Aerial Vehicles (UAVs). They are expected to grow into a multibillion-dollar industry.

Drones have up until now been mostly confined to the military but are now being used more and more in civilian roles that go far beyond simple military use.

They are light, adjustable and easy to operate and often bring better results than traditional means of helicopters, light aircraft and satellites.

Drones are tools for collecting information, which is why big players in the digital economy like Amazon, Google and Facebook are so interested in them

Here are several uses of Drones to name a few:

1. Amazon Prime Air will fly individual packages out to customers within 30 minutes of ordering.
2. For real-time news, drones can be used to record the footage of a shootout in a bad neighborhood or nature’s fury of flood, earthquakes or wildfire outbreaks without risking the human lives.
3. Farmers have a tough job, but drones can make it easier: they're a great way to do aerial surveys of crops or spraying the pesticides. This way, farmers can see if their irrigation systems are working, how their plants are growing, even see if any of the plants are sick by using infrared technology. 
4. In the real estate industry, it's becoming increasingly common for property listings to be accompanied by a drone tour so residents can choose where to live. 
5. Insurance companies are using them in claims settlements to assess the home roof damages.
   
6. Domino’s has tested pizza delivery with DomiCopter to help their boys avoid rushing through traffic.
7. Drones are great for sports or any big event with interesting activities going on that look even more interesting when viewed from above.
8. Police departments across the country are buying drones that they can use for surveillance and related activity and apply BigData Analytics to predict crime. 
9. Hollywood movies like Skyfall & Harry Potter had used drones for shooting stunts.
10. Human couriers could very well be replaced by their robotic counterparts the day drones go mainstream.

It is not the technology but the regulations from aviation authorities that will be a major barrier and it will be a while before drones are allowed out to do their own thing.