The Industrial Internet (Of Things)

Behind GE’s (and Cisco’s IoT) Vision For The Industrial Internet Of Things | Fast Company

There is more to the Internet of Things (IoT) than FitBits and smartphone-controlled thermostats. While consumer goods are some of the IoT’s most visible applications, they’re just one part of the vast and game-changing phenomenon that could soon encompass 200 billion connected devices and add trillions of dollars to the economy. The global market for the “Internet of Things” is expected to grow to $7.1 trillion in 2020, up from $1.9 trillion in 2013.

In fact, experts estimate that the IoT will resonate strongly in the “invisible” industrial sector, capturing and analyzing data generated by drilling rigs, jet engines, locomotives and other heavy-duty machines. This network is called the Industrial Internet and it’s already helping companies shave costs and boost performance.

“The Evolution may look old-fashioned, it is in many respects a hurtling computer. Its array of sensors and data-collecting devices complements its bulky mass with a sleek, digital agility that will grow only more impressive and more significant with time. It is also a rolling electronic laboratory, a locomotive’s insides contain 6.7 miles of wiring and 250 sensors that put out 9 million data points every hour.
In the coming years, the number of sensors and data points will climb precipitously. In this fusion of old and new, this melding of heavy and light, you can see that the Evolution resembles its maker, General Electric, a company that manufactures huge things for huge customers and yet is reinventing itself–and, in the process, the very economics of heavy industry–by embracing a new kind of sophistication.

Two years ago, at a San Francisco conference billed as “Minds and Machines,” GE CEO Jeff Immelt took the stage to explain the company’s behemoths like the Evolution. The catchphrase he used that day, the “Industrial Internet,” has by now become commonplace in technology circles, even though it has been barely realized in terms of impact.
At times, the Industrial Internet has been lumped alongside the so-called Internet of Things, which usually describes the effort to bestow networked connectivity on, say, your home lighting or thermostat. Yet GE’s industrial effort is more ambitious than that. Immelt’s point in his speech was that GE could no longer just build big machines like locomotives and jet engines and gas turbine power plants–“big iron,” as it’s known within the company. It now had to create a kind of intelligence within the machines, which would collect and parse their data. As he saw it, the marriage of big-data analysis and industrial engineering promised a nearly unimaginable range of improvements. A new GEnx jet engine with a multitude of sensors could spin off an awesome amount of information. GE would in turn help predict, say, when a crucial engine part required repairs. GE would use data from machines like the Evolution to optimize performance to undreamed-of levels.

Angling in the Data Lake- GE and

In trying to build smarter machines, the company is also vying to create a new industrial age that produces broad, rippling gains for the entire global economy.
GE’s Industrial Internet may seem like a single, comprehensive approach to infrastructure technology. But in truth, the Industrial Internet is made from a dizzying number of components–software as well as hardware–that will be rolled out over the course of the next decade.

energy_slide 1
“The goal is not just to take data I have today, but to go back and look at the data we have already and see if it shows we could have predicted a historical failure,” Stokes says. His team would look at the broken-down locomotive and comb through its data banks to try to discern a pattern. “We want to turn that into an algorithm that helps us predict the future,” Stokes explains. “We want to say: These three conditions, in this sequence, mean there’s a 90% chance this failure will happen.”


Machines that talk, machines that react, machines that constantly update their status–it sounds a bit like a social network… of machines.

GE, at any rate, doesn’t make its pile of money merely from selling big machines. It makes as much, or sometimes more, from servicing those machines via customer contracts, now worth some $180 billion in all, that can stretch for 20 years or more following a sale.

“The first wave was: It breaks, we fix it,” Comstock says, talking about how things worked in the 1960s and 1970s. The second wave, developed in the 1980s and 1990s, were service agreements that assured customers that a GE–built jet engine or turbine would achieve a certain level of performance and would have regularly scheduled maintenance based on GE’s experience with the wear and tear of its parts.
An approaching third wave, enabled by data and analytics, does something new. It strikes an agreement between GE and a customer for a certain kind of outcome, rather than a certain kind of functionality. It’s not only about measuring whether a jet engine is working up to its specifications, or about repairing it on time, but whether it’s delivering, say, the agreed-upon amount of peak operational time. “We’re getting to the point of selling thrust, not engines,” says Brad Surak, a software manager for the company. “Or we’re selling locomotion, not locomotives.


If another company–a Silicon Valley startup, say–figures out how to do the analytics on GE’s industrial equipment first, the industrial giant might see the lifeblood of its service business threatened. A quest to make intelligent machines.

The digital revolution we’ve witnessed in the consumer arena is at last ready to invade new territory. “I believe in this stuff more than you can imagine,” he says, “because I think all machines are going to get smart. They’re going to talk. The technology is there, but we have to get it to work in an industrial way.” What he means is that an Industrial Internet can pose a more stringent set of requirements than the consumer one. Ruh likes to say that if your cell phone drops a call, you get annoyed, but if your power goes down, you get angry, or fearful–or people in hospitals die. Therefore, reliability–a zero tolerance for platform failures–is essential in the software he builds. So too is cybersecurity.

At the launch of the Industrial Internet in 2012, he recalls that ­Andreessen had just written a hotly debated article for The Wall Street Journal about how software would “eat” the world. Andreessen wrote, “My own theory is that we are in the middle of a dramatic and broad technological and economic shift in which software companies are poised to take over large swathes of the economy.”


The coming progression of smart technologies will lay the groundwork for a second great industrial age–a more distant future where intelligent machines can be upgraded into what the company calls “brilliant” machines. These devices wouldn’t just let you know they were going to break down. They would actually repair themselves.

The Chief Marketing Technologist

Marketing is rapidly becoming one of the most technology-dependent functions in business. In 2012 the research and consulting firm Gartner predicted that by 2017, a company’s chief marketing officer would be spending more on technology than its chief information officer was.

A new type of executive is emerging at the center of the transformation: the chief marketing technologist. CMTs are part strategist, part creative director, part technology leader, and part teacher. They have a common job:

  • aligning marketing technology with business goals
  • serving as a liaison to IT
  • evaluating and choosing technology providers
  • helping craft new digital business model

The best CMTs set a technology vision for marketing. They champion greater experimentation and more-agile management of that function’s capabilities. And they are change agents, working within the function and across the company to create competitive advantage.


This rise in digital budgets is not merely a migration of spending from traditional to digital media. A growing portion of marketing’s budget is now allocated to technology itself. A recent Gartner study found that 67% of marketing departments plan to increase their spending on technology-related activities over the next two years. In addition, 61% are increasing capital expenditures on technology, and 65% are increasing budgets for service providers that have technology-related offerings.


There are now well over 1,000 marketing software providers worldwide. CMO and the CIO must collaborate closely. Marketing technology must be managed holistically. In a virtuous cycle, what’s possible with technology should inspire what’s desirable for marketing, and vice versa.”

via The Rise of the Chief Marketing Technologist – Harvard Business Review.

Next Gen Ads

“Standard ad formats are essential to delivering the scale needed by national [& international] advertisers. The demands placed on digital ad standards have increased exponentially since their inception, fueled by the rapid increase in bandwidth, device proliferation, and user expectations.

The next generation of standards must work for different ad types (e.g., brand vs. direct response) in a world where content is fluid across screens, while also being flexible enough to accommodate continuous change.


The growing complexity of the digital advertising ecosystem makes ad standards more necessary today than ever before, but also raises the bar for what the standards must deliver.”


via Preparing For A Post-Banner World: What To Expect From Next Gen Ad Standards.

A Great Logo

“The Making of … 6 questions to ask yourself when designing a brand:


  1.  What emotions does the logo evoke?
  2. What’s the meaning behind the logo?
  3. Will the logo stand the test of time?
  4. Is it unique? Can it be instantly recognizable?
  5. How does it look in black and white?
  6.  Is it clear and distinct in small dimensions?”

via The Makings Of A Great Logo | Co.Design | business + design

2014 Internet Trends

Kleiner Perkins Caufield Byers

Mary Meeker, a partner at VC firm KPCB and one of the legendary observers of the Internet industry, is presenting her annual outlook on the industry.

It’s a Mobile 1st (emerging) World – Many Developing Nations Leapfrogged The Laptop/PC Era and went straight to using smartphones.

KPCB Internet trends 2014 - Time per Medium


Online Content Strategy

“Stories are both revealing and memorable.

Content strategies online demand that we quit the marketing and corporate speak and start telling stories.

People don’t want to hear corporate-speak about your company, product or service, they want to hear actual stories about how your customers are doing better by doing business with you!
A hiring process called Targeted Selection

One of the keys to the interview process with a new candidate was asking open-ended questions that required the candidate to tell a story. The reason was because it was a lot easier to get people to reveal their honest answer when you asked them to describe the entire story rather than ask them a yes or no question.

Here’s an example:

  • Do you work well with tight deadlines? Answer: Yes
  • Storified… Can you tell me about a time at work where you had a number of very tight deadlines that were going to be a challenge, or perhaps impossible, to make? Answer: A story that you could ask additional details about.”


via Infographic: Storytelling versus Corporate Speak | Marketing Technology Blog. Inspired by Steve Clayton


Customer Experience lead Transformation

Altimeter: Technology Should Not Lead Digital Transformation

“A one-size-fits-all approach to digital transformation doesn’t exist.

Altimeter interviewed 20 executives and social strategists at 14 companies about their experiences in adapting to the new digital customer experience.

CMOs are getting more budget than CIOs, digital marketing is becoming a big priority for companies, brands are increasingly upping their budgets for mobile, social, and automation.

The catalysts for digital transformation have been technology-driven, not customer-driven. That means many businesses are embarking on a digital transformation only to find themselves not aligned with their digital customers’ expectations. “If we focus on technology, we will miss the human factors disrupting and making changes,” Brian Solis said.

The Elements of Digital Darwinism1

  • Digital transformation should be driven by the expectations of digital customers
  • “The role of the CMO is more important and strategic to a company’s success than ever before.”
  • Many businesses are still operating in a funnel model

Digital Transformation graphic1

Study what their digital customers want and expect, so that decisions are based on data and insight. The top companies understand, through data, that the customer journey has changed, and they’re able to optimize for the new journey.


All companies going through this change have built out a “digital transformation team,” which is a cross-functional business unit—often called a center of excellence—that is dedicated to digital customer experience.


“Aside from this research, we have heard that when companies really get deep down into [the digital transformation], they learn the values and expectations of digital customers are different than those of their traditional customers,” Solis told “And I won’t sugar coat it: That’s when things get hard. Everyone said that this [digital transformation] is like a marathon. You’re asking people to see the world differently and to change. That induces fear and self-preservation.””

Full Report here.

More on Digital Transformation.


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