How Can IoT Help Slow Down an Economic Downturn?
While we know the Internet of Things (IoT) has a lot of potential, you might not realize that it can also be used as a tool for economic downturn management.
During the most recent economic downturn — for example, the 2020 COVID-19 pandemic (but we know you haven't forgotten) — the IoT helped to promote business continuity during lockdowns. According to Forbes, with maintaining operations being the most important goal during this period, digitization through IoT allowed for business to continue as usual in many cases, allowing employees to work from home. IoT made it easy to transition – and many organizations are continuing to promote a more hybrid work environment after recognizing just how seamless the shift really was.
How does IoT help during economic downturns?
There are multiple ways in which IoT technology is being used to limit the negative impact of a less-than-flourishing economy. These include:
- Its capability of monitoring and recording data related to a wide range of factors such as power outages and natural disasters, making it easier to detect trends and predict future events. In the event of an economic downturn, this data can serve as a warning signal, allowing businesses to adjust their operations accordingly.
- It can increase the efficiency of manufacturing processes, which will result in lower costs and higher profits. This also keeps cash flow moving even when sales numbers temporarily decrease.
- IoT allows data to be collected and analyzed in real-time which will provide stakeholders with valuable insights that they wouldn't have been able to get if they relied on old, offline methods.
- It also provides the opportunity for collecting data about natural resources like water, oil or minerals and using that to ensure resources are always in abundance. Something that possibly could have prevented the recession of 1990, which is often traced back to a hike in oil prices of almost 135%.
Is it possible that IoT could contribute to an economic downturn?
As technology advances, it does take time for many industries and the businesses that work within them to catch up, integrate and become comfortable investing them into their company processes. Many more organizations are aware of the benefits that technology can bring, such as increased revenue and the means to gain a head start or step up from their competition. It may be possible that new innovations in the IoT universe could cause sales to dip and other factors could influence a temporary pause in economic growth, but we will always see more prosperity as businesses adapt.
By taking advantage of the features of IoT outlined above and more, businesses are better able to weather economic downturns and maintain strong operations throughout the process. By using IoT to monitor and predict economic conditions, we can avoid the worst of recessions and ensure we continue to build a stronger economy moving forward.
Invest in IoT technology with Perle
Perle offers device servers and terminal servers that can ensure you are always ready for the next evolution in IoT technology, so you can streamline it into your business. For more information, reach out for a discussion.