There are many reasons to embrace the Industrial Internet of Things (IIoT) – including its ability to increase operational efficiency, improve customer experiences, and create new revenue streams. Launching an IIoT initiative, however, has historically been a challenging undertaking. In fact, according to a Microsoft survey, 30% of IoT projects fail in the proof-of-concept stage.
At Sierra Wireless, we think innovative and forward-looking companies deserve better odds than that. That’s why we developed Sierra Wireless Octave™, an all-in-one edge-to-cloud solution for connecting industrial assets. This comprehensive solution dramatically simplifies the process of both developing and commercializing Industrial IIoT applications. No need to take our word on it, though – see what independent research firm Forrester Research has to say.
Earlier this year, Sierra Wireless commissioned Forrester to conduct a study on Octave’s ability to help companies rapidly develop and commercialize IIoT solutions. Forrester conducted interviews with existing Octave customers – including a 4,300 employee industrial product manufacturer and an 1,800 employee industrial monitoring device manufacturer – and then designed a composite organization based on characteristics of the interviewed organizations. From there, Forrester conducted an objective Total Economic Impact™ study examining the potential return on investment (ROI) enterprises may realize by using Octave to develop and operate IIoT applications.
The key findings of the report are illuminating in several important ways. They show companies realize measurable and quantifiable cost savings and time savings – as well as security and business agility benefits – through the use of Octave versus taking an internal, Do It Yourself (DIY) approach to IIoT infrastructure development.
Let’s take a closer look at the various ways Octave streamlines IIoT application development and deployment, making it quicker, easier, and less expensive for companies to start realizing the benefits of the IIoT.
One of the biggest pain points companies face when getting an IIoT initiative off the ground is software development costs. Specialized software engineers don’t come cheap. For example, an advanced engineering manager at the industrial product manufacturing company that Forrester interviewed lamented: “When we worked internally, we had to subcontract support for a system architect; the total cost was €80,000.”
The cost difference is dramatic. When developed internally without Octave, an IIoT application typically costs around $400K-$450K. With Octave, Forrester reports, these costs are reduced by 45%. That’s an average development cost saving of around $190,000. Speaking to the benefits of Octave in this regard, a project manager at the industrial monitoring device manufacturer that Forrester interviewed noted: “It is not necessary to have a lot of resources to make the proof of concept because the integration and the use of the solution [Octave] are very easy and very fast.”
Software development is just the beginning of any IIoT initiative. There are also intimidating costs associated with device certification, management, and connectivity – as well as ongoing costs related to evolving and maintaining the application over time. For example, Forrester found that the avoidance of certifying and managing devices – along with managing connectivity subscriptions – across different regions and network operators cost $359,653 in the case of the composite organization. Additionally, Forrester found that evolving an IIoT application internally to meet changing use cases and business requirements, and then maintaining it on an ongoing basis, costs $94,500 for the representative case they analyzed.
Once again, Octave provides a simpler path forward. Rather than certifying devices on a country-by-country basis, managing multiple vendors and service providers, and overseeing connectivity subscriptions, companies can use Octave, which encompasses device certification, device management, and connectivity – all from a single solution. Octave can reduce these costs by 30%, for an average device management cost saving of $108,000 compared to the cost of a DIY approach, in the case of the composite organization, for which Octave also reduces the costs of evolving and maintaining an IIoT application by 75% – the equivalent of $71,000. As an advanced engineering manager at the industrial product manufacturer noted, “Clearly, the way they have structured Octave, with the cloud-based features and configuration, is an advantage and makes things much, much simpler for the software engineers…If you want to add a new communication protocol, like CAN or modbus, the gains are huge. With Octave, it’s only a day of work.”
Time is of the essence when it comes to IIoT initiatives. Companies embarking on an IIoT initiative want to get to market as quickly as possible, because that means faster time to revenue – and ultimately faster time to margin. The project manager at the industrial monitoring device manufacturer, when speaking about the company’s IIoT plans, neatly encapsulated the sense of urgency many organizations feel: “This project is time driven. We want to be the first in the market.”
Good news: Octave has a dramatic impact in this area as well. As an all-in-one edge-to-cloud solution for the IIoT, Octave does away with the obstacles and inefficiencies involved in building an IIoT application internally, ultimately reducing the time it takes to launch and delivering faster time to-commercialize margin by nine months in the case of the composite organization. We can see the benefits of this all-in-one approach in the comments of the project manager from the industrial monitoring device manufacturer: “The software and the hardware integration were easier. For example, Sierra lets you use the snap-in base solution.”
Forrester finds in its report that over a three year period, these development improvements lead to an initial cost savings of $77,000. Not too shabby.
In addition to these measurable benefits, the Forrester study also found some unquantified benefits from using Octave versus internally developing an IIoT application. These unquantified benefits centered around security and business agility (that is, the ability to launch new business models and create additional revenue streams).
On the security front, Octave’s integrated data orchestration – which includes secure data transmission from edge to cloud via an encrypted, highly resilient network with rotating security keys – greatly enhances security. On the business front, Octave’s data orchestration capabilities and data-as-a-service model offer enterprises the ability to deploy new business models and generate new revenue streams (for example, pay-per-unit or pay-per-use models). This is in part because costs are predictable, and maintenance and evolution of the IIoT application are simple.
Being able to change data processing rules at the edge as business needs and customer demands change differentiates Octave from other IIoT solutions, providing companies with a significant competitive advantage in today’s dynamic connected economy. In a recent Octave case study, Pierre-André Galy, Co-Founder and Chairman of Axibio highlighted these unique data orchestration capabilities, saying: “Octave makes it very easy for our developers to make changes to data processing rules at the edge. The ability to easily change edge processing logic on an immediate and ongoing basis is unprecedented.”
Let’s pause here to recap the case Forrester put together: A 45% reduction in solution development costs. A 30% reduction in device management, certification, and connectivity costs. And a 75% reduction in service evolution and maintenance costs. Plus, nine months faster time to margin. When you run all the numbers, using Octave ends up increasing the IIoT application ROI for the composite organization created by Forrester by a net present value (NPV) of $446K, or 88%. And this higher ROI does not even include the additional security and business agility benefits.
The message is clear: Octave has many benefits to offer companies that are looking to make IIoT a reality within their organization. With Octave an organization can eliminate IIoT application development roadblocks, reduce application costs, and shorten their application’s time to margin, enabling them to use the IIoT to unlock value in the today’s connected economy.
Get innovation delivered to your inbox. Sign up for our blog and stay on top of the very latest from Sierra Wireless.