The Analytics of Things

While it’s undeniably useful to connect inanimate objects and sensors to the Internet, that’s only a first step in terms of doing something useful with all those connected devices.

The phrase “Internet of Things” (IoT) suggests that the most important attribute of distributed sensors is connectedness. While it’s undeniably useful to connect inanimate objects and sensors to the Internet, that’s only a first step in terms of doing something useful with all those connected devices. “The Analytics of Things” (AoT) are just as important, if not more so.

The AoT term points out that IoT devices generate a lot of data, and that data must be analyzed to be useful. It also suggests that analytics are necessary to make connected devices smart and for them to take intelligent action. Connection, on the other hand, isn’t required for intelligent action. There are many different types of IoT analytics, and connection isn’t required for all of them.

Think, for example, about a “smart” thermostat, now available from a variety of vendors. These thermostats sense not only room temperature, but also whether people are in a room, their patterns of activity during the day, and so forth. In order to make sense of such data and take action on it, smart thermostats have embedded analytics that help them decide when to turn themselves up or down. So they’re smart enough—even without being connected—to save energy with little or no user involvement.

Smart thermostats can also be connected to the Internet through wifi, and there are some potential benefits from doing so. Remote monitoring and control is one. I can turn up my thermostat during my trip home from work, or check remotely to make sure my pipes won’t freeze.

This is useful for controlling remote devices, but connection also yields more data and more potential for analytics. The primary virtue of connected analytics is that you can aggregate data from multiple devices and make comparisons across time and users that can lead to better decisions. Comparative usage of an important resource such as energy, then, is one key analytical approach to connected data.

What other types of analytics of things are there?

  • Understanding patterns and reasons for variation—developing statistical models that explain variation
  • Anomaly detection—identifying situations that are outside of identified boundary conditions, such as a temperature that is too high or an image depicting someone in an area that should be uninhabited
  • Predictive asset maintenance—using sensor data to detect potential problems in machinery before they actually occur
  • Optimization—using sensor data and analysis to optimize a process, as when a lumber mill optimizes the automated cutting of a log, or a poultry processor automates the preparation of a chicken
  • Prescription—employing sensor and other types of data to tell front-line workers what to do, as when weather and soil sensing is used for “prescriptive planting” by farmers
  • Situational awareness—piecing together seemingly disconnected events and putting together an explanation, as when a series of oil temperature readings in a car, combined with dropping fuel efficiency, may indicate that an oil change is necessary

This partial list of AoT possibilities begins to suggest their elements in common. One is that they are often a precursor to informed action. Comparative usage statistics, for example, might motivate an energy consumer to cut back on usage. Predictive asset maintenance suggests the best time to service machinery, which is usually much more efficient than servicing at predetermined intervals. A municipal government could analyze traffic data sensors in roads and other sources to determine where to add lanes and how to optimize stoplight timing and other drivers of traffic flow.

Another common element in the AoT is the integrated display of information—pulling together IoT information into one place so that it can be monitored and compared. In Singapore, for example, the Land Transport Authority has put many of the functions involved in IoT central information gathering and analytics into place. Its data sources include road sensors, traffic light monitoring, espressway traffic monitoring, intersection monitoring, GPS devices monitoring traffic and road conditions on 9500 taxis, parking place availability sensors, and crowdsourced public data. At one point all of these sources were independent, but Singapore has now created an integrated “spinal cord” for them called the “i-Transport Platform.”

Thus far, the primary use of the unified data is to push it out to drivers through electronic signboards (and to companies to create innovative applications), but one could easily imagine the use of automated analytics to change traffic light patterns, increase tolls for vehicles going into the city, or to recommend optimal routes. One could suggest that automated action is another possible element of the AoT, though it doesn’t always take place.

Who needs to bulk up on AoT? Organizations should start building their sensor data analytics capabilities if they have relatively little experience with sensor analytics or little exposure to fast-moving big data. If they see a lot of data coming and no clear way to make sense of it, the analytics of things is going to be important to their future. For example, if your organization (like the US military and intelligence sectors, for example) is using drones to capture a great deal of video, you may want to rapidly focus on capabilities to analyze video data and detect anomalies with little human intervention. The Secretary of the US Air Force lamented in 2012 that it would be years before humans could possibly analyze all the video footage captured by drones in war zones.

We’ll learn much more about the AoT as these connected devices proliferate. We’ll learn how to extract the data from them for analysis, and where best to locate the analytics. We’ll learn what kinds of analytical features and functions are most helpful. For now, it’s just useful to remember that the Internet of Things is only useful if those things are smart, and that will happen through the Analytics of Things.

Review Deloitte Analytics Trends report, to explore trends to watch in 2015, including innovations in security, cognitive analytics, data monetization, and more.

About the author:
Tom Davenport, a world-renowned thought leader and author, is the President’s Distinguished Professor of Information Technology and Management at Babson College, a Fellow of the MIT Center for Digital Business, and an independent senior advisor to Deloitte Analytics.


About Andy Painter

A passionate Information and Data Architect with experience of the financial services industry, Andy’s background spans pharmaceuticals, publishing, e-commerce, retail banking and insurance, but always with a focus on data. One of Andy’s principle philosophies is that data is a key business asset.
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