How does the Internet of Things impact digital transformation?

What is IoT?

IoT is essentially a network that connects physical devices, vehicles, machines, buildings and objects to computer systems or other devices via the Internet. These devices include common household appliances such as TVs, refrigerators, washing machines, etc. to tools used in industries to remotely manage and monitor automated equipment, control product quality, predictive maintenance, optimize supply chains, etc. Connected devices have the ability to collect, process and transmit information back and forth without human intervention.

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The advent of ultra-cheap semiconductor chips and the proliferation of wireless communication networks has made everything from pills to airplanes part of the IoT. Connecting all devices together with sensors adds to the intelligence of devices, allowing them to transmit data in real time without human intervention. IoT is also making the ecosystem of devices around us smarter.

While IoT is not a completely new trend, IoT technologies are increasingly being adopted by organizations and businesses in a number of broad areas (such as transportation, energy, smart cities, and defense) as a way to collect and use data effectively.

IoT is considered an emerging technology that has changed the way we think, act and interact with each other. It has also changed the way we work because it allows monitoring, control and automation on a very large scale and has impacted the digital transformation of organizations and businesses in various industries.

Statistics show that by the end of 2022, there were about 13.15 billion connected IoT devices globally, and this number is expected to nearly double and reach 25.4 billion devices by 2030.

How does IoT work?

As mentioned above, IoT allows everyday objects and products to be connected in a digital information network, allowing sensors to collect information about the device, software to monitor performance and collect data, and also allowing users to control the device.

One of the most important components that characterizes IoT is the ability to connect all the devices in the IoT ecosystem together. The IoT ecosystem includes IoT devices, security systems, information networks, gateways, cloud computing, applications, and users.

IoT devices sense information from their surroundings and collect it as data that is stored in cloud servers. This is done using sensors implanted in objects such as mobile phones, smartwatches, smart home devices, car devices, etc.

After receiving information from the environment, IoT sensors will share the collected data with the cloud server. This connection between the sensors and the cloud server can be done through cellular networks, satellite communication networks, Bluetooth, the Internet or other connectivity options.

Once the data is transmitted to the cloud server, the cloud server is responsible for processing, analyzing, and sending back the output results. The complexity of the processing procedures depends on the information received from the specific data environment, ranging from simple processes such as temperature control to complex security-related processes such as identifying intruders and thieves.

In the final stage, the output is communicated to the user, such as through alerts, text messages, etc. At this stage, the user may have to actively interact with the IoT device or it may be done completely automatically.

Top technology trends that help drive digital transformation through IoT

Digitalization has made great strides in recent times, bringing more opportunities and resources to organizations and businesses around the world. This digitalization process is closely connected with the latest technology trends in IoT that help promote digital transformation:

1. Artificial Intelligence of Things (AIoT):In the era of technology 4.0, the explosion and combination of IoT and AI has created a lot of value for the development of organizations and businesses, typically the birth of AIoT.

Digital transformation is strongly promoted by the close combination of AI and IoT. The use of machine learning technology and various advanced algorithms of AI will add value to IoT and improve its operations. The combination of AI and IoT has promoted digital transformation, improved the level of interaction between humans and machines and devices, enhanced management capabilities, and optimized data analysis systems.

The combination of AI and IoT makes AIoT a powerful and important tool, bringing many different applications such as smart store systems; smart offices, factories; traffic monitoring by drones; vehicle operation management and self-driving cars, etc.

2. Blockchain technology(blockchain): is a type of database, information is stored in blocks and linked together. Information in blocks, links will be encoded and can be expanded over time. Every time a new information or transaction occurs, the old information will not be lost but instead, the new information will be saved in a new block and in turn connected to the old block to form a new chain.

This is a technology that has the potential to address security concerns in IoT. This technology can be used in many industries as a platform to securely store huge amounts of data. Moreover, it allows organizations and businesses to optimize their processes, manage digital documents, track orders, etc.

3. IoT technology based on 5G connection:In recent times, we have witnessed the penetration of IoT into human life in all fields. Devices for smart homes, medical bracelets or smart watches are no longer strange to us. In the era of 5G hyper-connectivity, the number of connected IoT devices will certainly increase significantly. This new mobile network technology is making a big impact on IoT because it allows for faster, more secure and more reliable connections than ever before.

4. Digital copy(Digital twins):A digital twin is a virtual model of a physical object that spans the entire lifecycle of the object and uses real-time data from on-object sensors to simulate behavior and monitor operations. Digital twins can replicate a wide range of real-world items, from individual pieces of equipment in a factory to fully assembled versions, such as wind turbines and even entire cities. Digital twin technology allows us to monitor asset performance, identify potential failures, and make more informed decisions about maintenance.

Digital twins rely on IoT sensor data to transfer information from physical objects to objects in the digital world. Digital twins are mainly used in digital transformation in several fields such as manufacturing, automotive, and healthcare.

5. IoT-enabled wearables:IoT-enabled wearables are smart devices that can be worn as external accessories, embedded in clothing and apparel, implanted in the body, or even glued or tattooed on the skin. These devices can connect to the Internet to collect, send data, and receive information to make intelligent decisions.

Wearable devices can interact with a range of other devices, such as smartphones, for computing and communication purposes. Due to the mobility of humans and animals, wearable devices are becoming increasingly important because they can collect and send data on the go, and receive information from the Internet to help make smarter decisions.

6. Internet of Behavior (IoB):The concept of IoB is an extension of IoT. IoB is oriented towards using data and insights to change behavior. It is understood that active IoT devices are a huge source of data for IoB models.

Using IoB technology, organizations and businesses can track consumers and their behavior and use this data to develop infrastructure systems. IoB can change a person's daily behavior, like a health tracking application can take data on physical activity habits, diet, sleep, etc. to change behavior like providing users with health improvement plans.

How does IoT enable digital transformation?

Digital transformation is a continuous process that helps organizations integrate and enhance the use of digital technology to achieve long-term growth and stay relevant in a fast-paced industry. And IoT is a factor that is significantly influencing the digital transformation process of organizations and businesses.

All the valuable data generated by IoT devices can be used by organizations and businesses to accelerate their digital transformation. For example, they can be used to assess customer needs and then provide services based on that. Furthermore, it can increase customer engagement, thereby increasing customer satisfaction. IoT can also support employees and enable operations to be performed anywhere and anytime. It also enables the implementation of new tools and strategies.

IoT impacts the digital transformation of organizations and businesses as it opens up new investment opportunities, reduces operating costs, improves customer experience, improves productivity and efficiency, improves decision-making, empowers business models and increases revenue.

IoT is becoming the future of digital transformation in various fields such as healthcare, education, security, communications, agriculture, transportation and government agencies.

Thus, the use of IoT in the digital transformation process brings many benefits to organizations and businesses that want to maintain competitiveness in the market. They help organizations and businesses achieve higher efficiency, save costs and attract more customers. IoT-based solutions form an indispensable part of the operating model of organizations and businesses and are therefore considered an indispensable part of the digital transformation strategy./.

Phan Van Hoa