On Feb 15, IBM opened their global IoT headquarters in Munich, announcing more than 1,000 IBM employees and partners will work at the centre — a $200 million project. The atmosphere at the opening ceremony was electric. The centre has been one year in the making and the latest milestone in IBM's IoT commitment, announced in 2014, when the company said it would invest $3 billion over the next four years to build up their IoT business, based on its IBM Watson artificial intelligence eco system.
At the ceremony, IBM announced a series of IoT deals and partnerships with companies including Indiegogo, Visa, Bosch and the French railway operator SNCF. (To read more about the opening, visit: IBM links with Indiegogo, Visa, Bosch and more in $3B IoT push and YouTube).
The IBM IoT is focused on the AI, cognitive and content associated across its many business verticals, and their interconnections. Built on the IBM Bluemix cloud platform, which uses IBM Watson to bring cognitive capabilities to the IoT eco system. In addition it offers a number of industry-focused modules (including weather, cyber security, workers safety, etc.) and a marketplace, effectively integrating nearly every facet of life via its IoT platform and services.
IBM's Research Labs around the globe will also continue to research the field of IoT, developing new applications and business opportunities which, once mature, potentially become part of IBM Watson IoT like the worker safety business, which was developed at the Haifa Research Lab.
A tour through the Watson IoT facilities covered three areas, to showcase how the IoT facility can be leveraged in moving quickly from identifying the needs of the business through to a digital mock-up of how it is able to be integrated into Watson IoT: Design Thinking Lab, office automation (enabling global multimedia collaboration) and robots, Customer Experience Lab (where they develop new concepts like a connected wash machine and related new business models), and the Industry Lab (containing a physical demonstration of every industry sector that links IoT, from workers safety to connected cars).
Processing the resulting vast amounts of data being generated, drawing out actionable insights that can be turned into products and services will require even more powerful eco systems including networks, analytical capabilities and cloud technologies. A number of vendors such as IBM, Microsoft, General Electric, SAP, Amazon, Google and others are investing heavily and making IoT a core part of their offering.
As we move from the Internet of Things to the Economy of Things, it was clear that many in the insurance and finance sector are still trying to come to terms with what this new era of technology and data means for their business and how to best capitalize on this new collaborative ecosystem.
In summary, digital transformation is happening – business strategies, quality of industry standards, company cultures, local regulations and potential new market disrupters are just a few of the factors which might influence the digital transformation speed of a specific industry.
But what are the main drivers? In areas such as manufacturing, logistics and other related industries the benefits are obvious: reduction of costs, gain competitive advantage through improved time-to-market and higher degree of automation (increases supply-chain flexibility).
As each of these elements has potentially an impact on risk, the insurance industry needs to answer the following three questions:
1) What is the impact of IoT on existing risk pools and books of business?
2) Does IoT help to access new risk pools, i.e. are there new emerging risks (e.g. non-damage BI related)?
3) Does the availability of data and innovative analytical capabilities enable risk management related insights for risk carriers?
Where do you see the biggest impact for IoT? What are the biggest opportunities and hurdles?
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Location: Munich, Germany