Broadening the value of the industrial Internet

Remote monitoring appeals to management, but good applications create value for those being monitored as well.

The industrial Internet makes data available at levels of frequency, accuracy and breadth that managers have never seen before, and the great promise of this data is that it will enable improvements to the big networks from which it flows. Huge systems can be optimized by taking into account the status of every component in real time; failures can be preempted; deteriorating performance can be detected and corrected.

But some of this intelligence can be a hard sell to those being monitored and measured, who worry that hard-learned discretion might be overridden by an engineer’s idealistic notion of how things should work. In professional settings, workers worry about loss of agency, and they imagine that they’ll be micro-managed on any minor variation from normal. Consumers worry about loss of privacy.

The best applications of the industrial Internet handle this conflict by generating value for those being monitored as well as those doing the monitoring — whether by giving workers the information they need to improve the metrics that their managers see, or by giving consumers more data to make better decisions.

Fort Collins (Colo.) Utilities, for instance, expects to recoup its $36 million investment in advanced meters in 11 years through operational savings. The meters obviate the need for meter readers, and the massive amounts of data they produce is useful for detecting power failures and predicting when transformers will need to be replaced before a damaging explosion occurs.

But that data isn’t just useful to those doing the monitoring — it’s turned around to generate value for the households that have advanced meters. Utility customers can see detailed graphs of their electricity and water usage, and integrated software from Aclara uses a statistical model to break out electricity usage into categories like heating, cooling and lighting. It then makes customized recommendations for energy savings by referring to county building records to find the age of a building and its construction type. The utility will even send a staff member to big commercial clients to consult on energy savings.

I spent some time chatting about this idea with Stephen Liguori, GE’s executive director for global innovation and new models, who taught a class at Columbia University’s business school last fall on marketing through business applications. (Disclosure: GE sponsors O’Reilly’s industrial Internet coverage.) Over the course of the six-week class, Liguori’s students developed proposals for industrial Internet applications, composed business plans, and submitted feedback from potential clients in a handful of industries. Liguori walked me through some of his class’ projects and introduced me to his students.

In one project, students designed an application that monitors power plants, providing real-time operating statistics as well as summaries that help managers optimize maintenance investment. It was clear that managers above the level of an individual power plant would want an application like this, but buy-in from lower levels might be harder to achieve; managers are often reluctant to submit themselves to measurement by their bosses.

The best way to build support, Liguori’s students found, was to offer everyone involved useful information, so they added diagnostic features to the app that help plant managers isolate problems with their machinery, as well as contextual documentation that helps workers get to solutions faster. “Once [the plant staff] saw that they would be getting more data out of this, they bought into it,” says Rebby Bliss, one of the students developing the project.

Students working on the other project approached a problem at a large Northeastern hospital: its doctors refer many of their patients to independent radiology clinics rather than the hospital’s own radiology department. Both provide similar quality of care and diagnostics, but doctors find that it’s easier to schedule their patients into the outside clinics.

The students’ response is an application that provides direct access to the hospital’s radiology department scheduling service and to the results of its scans. The hospital’s goal of increasing referrals to its own radiology department might be achieved simply by improving access to data — inbound and outbound — for physicians.

Both applications take into account information overload and the need for good queuing and prioritization. “What we found is that everyone at these facilities is getting tons of alerts,” says Liguori. “When you’re getting 800 alerts a day, you might as well be getting no alerts at all.”


This is a post in our industrial Internet series, an ongoing exploration of big machines and big data. The series is produced as part of a collaboration between O’Reilly and GE.

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