IoT World 2016 took place10-12 May in Silicon Valley, United States, organized by Informa Group. At the event, the JSON.TV team had the opportunity to speak with Terrence Nadeau, Vice President Global Procurement, Building Efficiency, at Johnson Controls. Mr. Nadeau spoke about the real benefits that Johnson Controls has already earned from smart, connected chillers and other intelligent equipment, as well as how value-chain analytics can create an IoT ecosystem for large companies, small companies and even governmental entities.
Terrence, thank you for speaking with JSON.TV. Can you tell us a bit about Johnson Controls?
- Johnson Controls is a global supplier of products, services and solutions. We optimize energy and operational efficiencies for buildings – particularly in the HVAC/R sphere (heating, ventilation, air conditioning and refrigeration), security and auto components. Our industrial-grade chillers are able to maintain ideal temperatures for large or complex buildings. It could be Empire State Building, the Kremlin or Levi’s Stadium – the building we are standing next to. Overall, we have more than one million business customers around the globe.
So our first question has to do with connected products and IoT. How does these advancements influence and benefit your business?
- Well, thanks for that very essential question. Let me give you an example of what we’re already doing in the area of connected chillers and how it’s impacting what I do in a positive way. So, today we’re connecting all our chillers and gathering information from them. We’re also taking our very large install base – because some of our chillers are 30-plus years old – and we’re putting connectivity on them to able to understand all aspects of energy usage: where they’re located, how the customer is using them, their overall efficiency or effectiveness, etc. We’re collecting that data, and we’re able to harness the data with advanced predictive analytics. So, from my space, what we’re able to do is really anticipate the needs from a service perspective for our customers.
Let me give you a specific example: Texas. We have a ton of chillers in Texas, because it’s hot. We’re able to know the average age of our chillers and analyze the data behind that equipment to prevent anything from going wrong. We put all received information into our demanding supply-planning process, which then comes to my procurement organization. So I’m able to address those needs quickly, which will help our customers in the end.
From a procurement perspective, we’re able to leverage value this way. I’m able to put only necessary equipment into the right warehouse at the right location. It’s really a win across the entire value chain.
Terrence Nadeau, Vice President Global Procurement, Building Efficiency, Johnson Controls
If governmental entities plan to start implementing some IoT projects from the ground-level, what would be the first steps, in your opinion?
- Probably the first thing you need to do is try to figure out – from a government perspective –what’s the problem you’re trying to solve. Because we know that every government struggles to find funds to build infrastructure, help small companies to grow, create new jobs, etc. So what companies like ours do is that we’re able to take assets you have today and maximize their efficiency. We’re able to reduce the energy costs of governmental bodies and extend the life of their existing assets. That creates additional savings that can be applied to all different governmental needs.
How can we encourage governmental entities to pay for projects that have proved their efficiency? And how can we work with small, innovative companies that need financial aid?
- What I would try to facilitate – from the government side – is matchmaking. How do you take the companies that you have today and do business with them, whether it’s automotive companies or any other industrial company? How do you pair connectivity needs with companies that are experts in IoT? Johnson Controls is successful based on the performance of our business, and we do a lot of matchmaking with smaller companies. We try to introduce companies that may not fit directly with us but may fit with another partner.
So, you talked during the panel discussion about ecosystem development…
- Exactly! And if you think about how much, for instance, Microsoft has invested in IoT and cloud technologies – by matchmaking and marrying technologies – they’re able to leverage their investments and create efficiencies for the business, reducing costs.
Source: Building Efficiency, Johnson Controls
How can Russian companies build out a global production chain for IoT?
- We view IoT mainly as an accelerator for innovation. So, for instance, if you have a shoe company based in Russia, you could to connect with cloud partners and other technology accelerators to optimize your business processes, which, in my opinion, can significantly reduce costs and improve efficiency.
Which global partners do you have, implementing IoT strategy?
- As I’ve mentioned, our key partner for cloud-based services is Microsoft, so we use their cloud-based products and tools for data that we collect external to our company. We’re also doing a lot of innovation on next-generation products, for which we’re using Microsoft’s interface-visualization tools, analytics and other things. So we’re not only using cloud-based platforms, but IoT accelerators more widely.
What could you add in conclusion regarding doing business with governments?
- From my perspective, the governmental entities can utilize a company like Johnson Controls to reduce their overall cost significantly. Think about all the facilities and assets that the Russian government owns. As a rule, more than 40% of the overall energy consumption in the world comes from buildings – that’s a lot of wasted energy. So companies like Johnson Controls can be a huge enabler to help governments drive down operational costs from buildings and facilities. Then they can redeploy money into things that are important to them.
Terrence, sure. Thanks a lot for the interview!
- You are welcome!
By Sergei Maltcev
See also other interviews from IoT World 2016: