How Can Businesses Use IoT to Overcome Economic Downturns?
In its Global Economic Prospects report, the World Bank projects the global economy's growth rate will slow from 2.9% in 2022 to 1.7% this year. Furthermore, the report indicates that global output is expected to stay below pre-pandemic levels until 2025.
Given these grim forecasts for future economic growth, businesses must rethink their strategies to stay afloat in this new era. Fortunately, technology has opened up new opportunities for enterprises to survive and thrive during harsh economic conditions.
One such example is the Internet of Things (IoT). Through IoT-backed strategies, businesses can effectively streamline productivity, optimize operations, and ultimately maintain profitability and competitive advantage in economic downturns.
Today's post will explore how businesses can use IoT to overcome economic downturns. But first, let's understand what IoT is and why it matters to modern enterprises.
What is IoT?
IoT is an internet-driven network of connected physical devices, home appliances, vehicles, and other items embedded with software, sensors, and connectivity that enable them to collect, exchange, analyze, and act upon data.
Depending on the "things" connected to the network, IoT enables users to monitor and control the environment around them and everyday processes, resulting in improved efficiency and convenience. For example, a connected fridge can automatically order groceries when they run out, while a smart thermostat can adjust the temperature in a home to conserve energy.
IoT has immense potential to transform how businesses operate. By automating mundane tasks and processes, IoT can significantly boost efficiency while reducing labor costs. More importantly, IoT enables automated data collection and analysis, providing valuable insights into operations. As a result, enterprises can know what to do to achieve critical goals like cutting costs, reducing risk, or unlocking new revenue streams.
How can IoT help businesses overcome economic downturns?
Primarily driven by the increasing adoption of smartphones, cloud computing, and Big Data analytics tools, IoT has become an invaluable asset for many companies in their quest to improve operational efficiency and reduce costs.
With a global recession staring the world in the face, it is more critical than ever for businesses to leverage data and automation. Read on for key ways IoT can help enterprises wade through the storm.
Automation is an ideal solution for optimizing time-consuming, repetitive tasks. One can easily "set it and forget it" to free up valuable business hours and focus on other areas requiring attention. This is especially crucial in difficult times when businesses are strapped for cash and cannot afford to hire new personnel for repetitive tasks.
By integrating IoT-powered automated systems, businesses can save on labor costs while allowing staff to focus on higher-value tasks. Moreover, automating processes like inventory management and customer support can reduce overheads and ensure the continuity of operations even in times of crisis.
Below are a few examples of IoT applications for automating tasks and unlocking efficiency.
- In the hospitality industry, hotel chains can install IoT-driven room sensors to detect occupancy and adjust the air conditioning, lighting, and other settings accordingly. This enables them to optimize energy consumption while providing a comfortable environment for guests.
- In the retail sector, IoT technology can track inventory levels, ensuring businesses never run out of stock during economic slumps. AI-driven chatbots can also take on customer service tasks from sales representatives, resulting in cost savings and an improved customer experience.
- In manufacturing, IoT-enabled solutions can automate routine maintenance processes and reduce the number of manual inspections. As a result, companies can minimize downtime and ensure production reliability, even when resources are scarce.
IoT automation helps cut costs, increases efficiency, and delivers an enjoyable experience across all levels. Therefore, businesses can maximize productivity and stay ahead despite trying times.
2. Advanced data analysis
The future of any business, especially in an economic slump, relies heavily on its ability to adjust according to market trends and customer requirements. Businesses must possess an adequate understanding of their operations and customer behaviors to develop informed decisions and strategize for the long term.
Thanks to the power of IoT, companies can now access vast amounts of data from connected devices, identify and analyze patterns, and make better operational decisions. For example, an IoT-driven platform can track customer buying habits, allowing the business to create targeted campaigns encouraging customers to remain loyal in a recession.
Additionally, IoT-based analytics programs can aid in the identification of opportunities for cost savings by recognizing areas for efficiency and improvement. In a manufacturing company, for instance, technicians can identify problems in machines and processes before they result in costly process failures. Supply chain managers can also readjust inventory levels based on data to ensure the company does not overspend on materials and other resources.
3. Predictive Maintenance
Keeping business assets in exceptional condition is vital during a recession. After all, limited budgets and resources mean companies cannot afford unexpected repairs or replacements.
Predictive maintenance solutions powered by IoT can help businesses predict and prevent breakdowns. By utilizing sensors, these solutions detect anomalies in asset performance and alert technicians to address potential issues before they become a bigger problem.
Predictive maintenance can tremendously benefit businesses that require regular and intensive maintenance, such as manufacturing, transportation, and logistics companies. In logistics, for example, IoT-enabled tracking and monitoring allow businesses to stay one step ahead of vehicle breakdowns, maximizing fleet reliability.
4. Employee Empowerment
Periods of economic downturns call for a hands-on-deck approach, where every employee must contribute and be held accountable for the company's success. Unfortunately, such an environment often leads to increased stress and lower morale, especially given that employees also feel the pinch of inflation in their everyday lives.
Thriving in challenging conditions requires businesses to prioritize employee well-being and empowerment. With IoT, companies can automate tedious tasks and enable employees to focus on more rewarding and meaningful work.
The Internet of Things can also offer remarkable convenience that many workers will appreciate. For example, work-from-home technologies can give them the flexibility to work from any location or time, allowing them to balance their job responsibilities and personal obligations. Meanwhile, cloud-based chat and video conferencing solutions can help them collaborate with their peers without compromising productivity.
Keeping employees satisfied during downturns is essential for businesses to survive and thrive. By implementing IoT-driven initiatives, companies can ensure their employees remain motivated and contribute their best efforts.
Make your business resilient in economic downturns with IoT
The global economy is on a downward trend, and few businesses are immune to the looming recession. Thankfully, IoT technology offers innovative tools and solutions to help weather the storm and remain competitive.
From automating mundane tasks to advanced data analysis, predictive maintenance, and employee empowerment, there is no shortage of ways to leverage IoT solutions to increase efficiency, cut costs, and improve customer experience.