The Internet of Things is considered a growth driver for all branches of industry. According to Deutsche Telekom’s digitalization index, almost half of the companies surveyed have already implemented IoT projects. All in all, these are isolated solutions with different components from different providers. We talk to Rami Avidan about his view of the Internet of Things (IoT), the new IoT Hub and what it all has to do with candy.
Is Corona booster or stopper for IoT?
Rami Avidan: One-word answer: it’s an enormous booster. With Corona, one of the immediate things that society as a whole realized was that we didn’t have complete end-to-end control of our supply chain and of our stock levels. This caused quite severe issues – just think about hospital equipment, right masks for people. Deutsche Telekom is definitely seeing an increase with regards to putting digitization to the higher agenda of corporates. IoT makes the supply chain transparent. Intelligent trackers send data in real time from the factory to the salesroom. IoT accelerates the various processes.
Deutsche Telekom's "IoT Hub" is the new central platform worldwide. Does the industry need another IoT platform?
Avidan: That’s exactly why we built our IoT Hub: we don’t need more IoT platforms for all those different components and countless platforms and capabilities in silos. What we need is to consolidate. We need to simplify. We need to remove barriers. We want to make it easier for our customers to tap into the value that IoT presents.
It’s almost like a big bag of candy: customers are going to be able to pick out the candies that they want to have to create the value they are looking for. That is the concept of the IoT Hub.
It enables our customers to select the individual IoT components – connectivity, devices, sensors, cloud and applications – and to manage them in a single holistic solution. In the IoT Hub, Deutsche Telekom orchestrates all capabilities and existing platforms of its customers.
That sounds very open. A new mind shift within Deutsche Telekom?
Avidan: I think we've been working on a mind shift for quite some time already at DT. Over the last couple of years, everybody has realized that not only IoT but a lot of other areas are more ecosystems approaches. The ability to work with partners, to create better solutions for customers, the ability to work with customers to optimize solutions to really hit the value that customers are looking for. That's why our IoT Hub is open for customers, partners, developers and competitors. Basically, we can integrate anything that our customers and partners want to integrate. But we of course only going to integrate what we in the end believe together with our customers and partners makes the most sense to integrate. After all, the worst thing would be an IoT hub with fifty different offers that actually do the same thing. Then things will become more complex again instead of simpler.
With the founding of Deutsche Telekom IoT GmbH (DT IoT) we are also breaking down barriers. We were too complex in our structures, according to our customers' feedback. If a customer wanted to buy IoT, he spoke with different organizations and employees. There were different contracts, price structures and service level agreements. As an independent company we are now able to serve the IoT market faster. And have bundled everything in DT IoT - from technical sales to solution design and production.
IoT is a strategic concept for you, not a technology. What is your advice for companies?
Avidan: From a technical point of view, we can now implement everything our customers want. This is not the problem. Rather, the problem is that companies have often not integrated their digital strategy into their corporate strategy. When companies ask me what they need to do to be successful in digitization, I give them these four recommendations:
- The digital strategy must be an integrated part of the corporate strategy.
- Get your leadership on board to work together to implement digitization. After all, digitization will change your organization and infrastructure - temporarily even impair them. Things need to be redesigned.
- Consider IoT as an investment and not as a cost. Think big, start small, prove the concept and then scale fast - the CFO needs to be your best friend.
- Do not digitize on your own. Create your own IoT ecosystem of trusted partners, suppliers and players that you want to build value together with.
You have two children. Do you learn from the younger generations?
Avidan: We can learn a lot from the younger generation. When I look at my children, I see how important it is to benefit from the knowledge of the more experienced ones and to help others. For me, this means, the more we help our customers, the more value they will create. I also see a very big change that young people are bringing to our behaviour in society as a whole.
I still belong to the generation that wants to own things like a car. The younger generation is driving a very different purchasing power. They are using car sharing and carpooling. They no longer buy a washing machine but buying the service of the washing machine. These changes has a great impact on our customers and how they engage in the market. Car manufacturers are driving car-sharing engagements. And the white goods industry are coming out with the ability not to buy the washing machine but to buy the service together with the washing powder.
We “older” people are used to going to an office. The new generation wants to do everything digital and everywhere if they have their laptops and mobile phones. That is driving a lot of changes in how we as a company deal and communicate with our employees. Let's leave it up to the employees to decide when a face-to-face meeting is useful. So this is about being smarter with our time, being more productive as individuals but it’s also about being much smarter with how we spend the company’s resources. Being able to instead spend them on generating more value for customers. That's a very large learning curve.