When you were a youngster, did you ever ride a merry-go-round and couldn’t quite reach the brass ring that streaked by upon every rotation? You were so close, but didn’t have the full reach to grab the coveted prize. I’m hearing a similar frustration from business leaders around the world when it comes to capturing the full power of today’s internet of things (IoT) technologies. They’re excited about connected technologies, but their company infrastructure is stuck in the last century. They’re not able to grasp the transformational value of today’s technologies.
The lesson from this dilemma is clear: Businesses should start upgrading their infrastructures now. By future-proofing their legacy systems along with their talent, companies can realize lasting success with today’s new wave of solutions, services, business models, markets and value propositions.
Unfortunately, too many companies aren’t extending their reach for the big prize. Instead, they’re stopping their IoT journeys at projects closer at hand and getting only incremental gains that improve processes, automate tasks and connect operations. Applications capturing this low-hanging fruit are great starting points, but they won’t future-proof their businesses for the digital future.
Four Important Interconnected Technologies
To move beyond incremental gains, explore four of today’s transformational technologies. I’m a big proponent of IoT, but IoT by itself isn’t transformational. That’s because merely connecting devices, machines and components won’t create new value propositions, business models and markets. However, when IoT is combined with artificial intelligence (AI), fog computing and blockchain, the solutions can be transformative.
In the simplest terms, AI is the brain that provides decision making intelligence, while IoT is the body that gathers the data and sometimes acts on the decisions. For example, manufacturers can feed data from IoT sensors on equipment to an AI system, which identifies patterns pointing to the health of equipment and enables predictive and preventive maintenance.
IoT also needs fog computing (also known as decentralized cloud computing), which allows for near-real-time processing and analysis of IoT data in a scalable way — from the edge of operations to the cloud. Traditional cloud computing with batch processing is often too slow and restrictive for bandwidth-intensive and real-time or near-real-time applications driven by IoT systems such as self-driving vehicles, drones or oil rigs.
The fourth critical technology is blockchain. A distributed ledger, blockchain allows multiple parties to easily record transactions performed among them in a secure and permanent way. It provides a single, indisputable record of truth. When paired with IoT, blockchain allows supply chains to track and trace goods to deter counterfeiting, ensure product quality and mitigate recalls. Automakers can use blockchain to authenticate interactions between self-driving vehicles and connected roadside infrastructure. Financial organizations can make microtransactions that were previously too small to generate profit. These examples only scratch the surface of industrywide possibilities.
Swarms of drones are a good example of how all four technologies can work together to create new business models and value propositions. These IoT “things” can perform tasks efficiently by communicating both vertically with the cloud and horizontally with each other. AI and fog computing enable autonomous drones to quickly make decisions (as individual systems or part of a group of drones) such as avoiding power lines, trees and poor weather conditions, and blockchain creates a trusted account of all data transactions.
The combination of these technologies makes drones more reliable, powerful and safe and gives them greater ability to help fight fires, rescue people during floods or identify gas leaks in deep mines. Innovative retailers can deploy drones for fast and convenient package deliveries. Walmart and Amazon (which are a customer and a partner of Cisco, respectively) are two retail giants already exploring this possibility. Both have filed patents recently to bring the technology to market.
However, to maximize the power of these converged technologies, businesses will need to upgrade their infrastructures. Fortunately, you don’t have to do a complete overhaul of your entire infrastructure all at once. Businesses can take a gradual approach that initially incorporates key elements like open protocols, security and distributed workflows. With these elements as the building blocks for your modern architecture, you can later augment your infrastructure with flexible frameworks and — you guessed it — IoT, AI, fog computing and blockchain.
Don’t Forget People
While these IoT technologies hold great promise when implemented with a modern infrastructure, business success isn’t really about technology — it’s about people. To future-proof your business, you also need to gather a diverse partner ecosystem and build a coalition of the willing both within and outside of your organization. Together with your partners, you can co-innovate game-changing solutions, whether they’re autonomous delivery drones, self-driving vehicles or something never before imagined.
Why is co-innovation pivotal? Simply because your customers are demanding it. Across industries, customers want to be an integral part of solving business problems — they want to work with premier providers to co-develop new and more competitive solutions. No longer are they silent observers who sit back and wait for a turnkey solution.
At the same time, the complexity of today’s technologies and the speed at which they’re changing make it seemingly impossible for a single company to deliver an end-to-end solution alone, no matter how much experience and how many resources they have. Companies must engage their ecosystems — which consist of horizontal specialists (vendors, consultants and startups that offer IT solutions and services) and vertical specialists (experts who can address market-specific challenges and use cases), as well as hyper-local experts, governments, academia and more, to deliver and scale disruptive digital solutions.
Back on that merry-go-round, I also remember that after several rotations, those brass rings disappeared, all grabbed up by others who were readier than I was. With businesses’ survival on the line, it’s time to make a dramatic leap to the next, more disruptive phase of enterprise deployments before it’s too late. To compete, companies need to combine IoT with AI, fog computing and blockchain, as well as upgrade their infrastructure, engage their partner ecosystems and instill a mindset of co-innovation inside and outside their own walls. Future-proof your business for the 21st century, and position yourself to seize that brass ring.
This article originally appeared in Forbes.