The Internet of Things is all around us and many of us probably don’t even realize it. It is changing the way we interact with so many things – from our cars and our homes, to our cities and the way we purchase.

If you are on a train, IoT has probably made sure that your train ran on time and didn’t breakdown. If you are craving a fizzy drink, it has ensured that the vending machine you are using has not run out, and is beautifully stocked with all your favorite ice-cold beverages!

We are also working with a company that is looking for an Uber-type model for repairing air conditioners. With a phone app and predictive analytics, they are fixing air conditioners through third parties, before they have a chance to break down — a huge success during the hot days of summer. Using sensors, we can collect vast quantities of data and turn that data into insights for business.

With IoT, what is fascinating is the speed at which everything is happening

If you live in a smart city, IoT has allowed the city to reduce its energy consumption — in some cases by over 50 percent — while keeping you safe at night with well-lit streets. Or it’s saved the truck driver time at the busy ports, waiting to unload his goods, getting him in without delay and back on his way with minimal wait times, also helping the port to double its amount of cargo handling.

There is also the example of where IoT can now estimate the fatigue of a bus driver by analyzing vital data from a vest he wears that indicates heart rate and nervous agitation and feeds back to an operator helping to keep school children safer.  This is a great innovation story about SAP and NTT using IoT technology to save lives.

But what is fascinating is the speed with which everything is happening. If you think about the telephone, invented in 1876, it was not until 1973 that we had the first mobile phones . That’s nearly 100 years later; today everything is so much faster and new business models are created daily.

Pay Per Use

Take Hilti, a large manufacturer of drills and construction equipment.  They have changed the way they sell to customers . For example, they are not selling drills any more, they are selling time. It’s a pay-per-use model, however long it takes you to drill your holes, that’s what you pay for. And what’s more, these companies are doing it with SAP. The solutions I mentioned are either SAP solutions or SAP in partnership with like-minded companies.

Our IoT and digital supply chain solutions have helped transform these business models. The train company Trenitalia has fitted its fleet of trains with sensors to monitor its fleet and prevent breakdowns before they happen using SAP Predictive Maintenance & Service and SAP Asset Intelligence Network (our Facebook of assets).  Customers are demanding applications that are seamlessly integrated.

We have enhanced our offerings with our acquisition of Fedem. With our digital twin and SAP Asset Intelligence Network, manufacturers and operators are now able to optimize the design and operations of a wide variety of industrial assets, particularly in remote and hard-to-reach places like the Antarctic without having to leave the building.

For vehicles like cars, forklifts, trucks, etc., and connected fleets there is SAP Vehicle Insights and the capability to take unstructured data from the vehicle and turn it into useful information, looking at fuel consumption, issues with the vehicle, or booking a service from your car.

SAP is using IoT in Walldorf to enable employees to get around the campus with a digital shuttle service. SAP IoT & DSC Operations, SAP IoT Moving Assets, SAP IT, SAP Global Design, and SAP Logistics Center have implemented SAP’s very own IoT using SAP Vehicle Insights. The solution transforms the shuttle service experience of more than 50,000 passengers every year on SAP campuses. By cutting down five minute waiting time per passenger on an average, SAP can save €2,000 per day or €400,000 per year.

So how does SAP capture all these new capabilities? The answer – SAP Leonardo. We launched SAP Leonardo to encompass our IoT and digital supply chain solution offering. At SAPPHIRE NOW, we expanded SAP Leonardo to include machine learning, artificial intelligence, analytics, Big Data, blockchain, and IoT — all running seamlessly in the cloud.

New Technologies Drive New Business Models

We are also very strongly focused on helping our customers with “Industrie 4.0,” which of course started in Germany, and will put an emphasis on helping customers with the many challenges they face today with digital transformation as the market moves more toward extreme design and demand variability. We are already working with Harley Davidson and other car producers.

Looking to the future, which is not that far away, we are starting to investigate how we use drones’ robotics and enhanced machine-to-machine communication. These new technologies will also help to drive new business models. For example, using drones to help in agriculture, public sector and security and robotics is becoming increasing important as customers look to transform their business processes from shop-floor to improved financial performance. With global spending on robotics expected to be in the trillions by 2019 this is an area to watch!

To learn more about SAP Leonardo IoT and SAP Leonardo, visit the SAP Leonardo website.