Remote monitoring can be considered “killer app” of the Internet of Things. The Service Council recently surveyed their members (service organizations) with IoT implementations, where they reported an average of 41% reduction in “service truck rolls”, an 11% increase in first-time fixes, and a 9% increase in asset up time. The amount of machine down time also decreased by 9% with the implementation of remote monitoring.
There are some misconceptions about what the Internet of Things (IoT) is, and what it means for facilities managers. In fact, the IoT has little to do with actually connecting things in buildings, unless, by connecting those things we can improve business processes and reduce costs. The Internet of Things can be defined:
The IoT is the application of inter-corporate business processes supported by Internet connected devices.
In FM, many common business processes and the software that supports them are document centric. This means facilities managers work with work order numbers, or purchase order numbers to identify units of work, and track costs without reference to the specific equipment being serviced. When that equipment becomes IoT connected, traditional work order processes using paper medium in a digital age no longer work.
Software-as-a-Service, the delivery of software over the internet, or “in the cloud,” is becoming more accepted as security protocols and market acceptance continues to grow, since web-based applications were first introduced in the late 1990s. This is largely because SaaS implementations cost less to manage, for both the SaaS service provider and end-users. Gartner reports that 44% of a 2014 survey respondents indicated “cost reduction” as the number one reason for migrating to SaaS model.
As far as the adoption rate of this technology, The Service Council surveyed 100 services and manufacturing organizations, nearly 70% indicated they have leveraged some form of remote monitoring, and of those 70%, more than 50% have been connected for more than five years.
Pricing is moving from a capital expense model to an operating expense often deployed as a monthly fee. Useful life cycles of technology have been reduced over the years as well as getting smaller and cheaper, thereby aligning better with SaaS strategies in recent years.
Commercial terms for remote monitoring solutions could be a flat rate per connected device (machine/ asset) per month, a rate per connected parameter i.e. kwh, liters, etc. or any combination.
Typically with SaaS there are reductions in the monthly fees in the area of 25% if the user purchases 12 months in advance.
Special consideration must be afforded when drafting the contract terms of a SaaS agreement: specifically, upon exit of the relationship, identifying who owns the data. It is essential the FM manager should never be left in a situation where they do not have access to their own historical FM data in a usable format.