Enterprises around the world are widely adopting artificial intelligence. The Internet of Things (IoT) is not far behind either. In fact, with IoT making it easy to collect and share data across a network of devices, it has become a must-have for many industries. However, you need advanced tools and technology to process and analyze the data collected by IoT. 

That’s why large enterprises have been investing in artificial intelligence to streamline and automate business processes. As a result, Gartner has predicted that around 65% of SMEs and large-scale enterprises will be using IoT by 2024.

Combing AI and IoT will take things to the next level by helping businesses use data in a way that’s never been done before. The combination of AI and IoT is a hit because IoT helps digitalize the physical world, while AI solutions make it easy to process and analyze a huge volume of data in less time. 

What is the Difference Between AI and IoT?

Artificial intelligence is a mix of rules and intelligence. Rules are the part where programs are written. Intelligence is the use of machine learning and deep learning to understand data and make sense of it. 

Internet of Things is a network of several devices that are interconnected and constantly send information to each other. This makes the devices smart and allows you to control them from remote locations. Voice assistants and smart devices at home (smart locks, smart lights, etc.) are examples of IoT in domestic life. 

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The main AI and IoT difference is that the Internet of Things is essentially hardware and network-based. Sensors, data collectors, computers, etc., are connected through a wireless network and send data to a central cloud server. 

Artificial intelligence usually works with data. Be it data gathering, cleaning, structuring, formatting, analyzing, or visualizing, AI is used to understand data collected by IoT. Internet of Things is less expensive compared to AI but has a higher success rate.  

The only way IoT can fail would be when the devices and components in the network are damaged or don’t work. However, AI has more chances of failure due to the wrong AI tool, incorrect data processing, or even inaccurate data. 

As long as you hire reputed AI strategy consulting companies to assist you, you can be assured that your investment will deliver the expected results. 

Reasons for the Surge in Demand for AI and IoT

A survey by SADA Systems in 2018 showed that AI and IoT were the leading technologies that the enterprises adopted. The trend is probable to continue for the foreseeable future. So what resulted in this increase in demand for AI and IoT?  

AI as a service is helping streamline business processes and adopt the data-driven model to make better decisions in less time. From automating recurring tasks to providing virtual assistants for employees, AI increases productivity, quality and reduces costs. 

Internet of Things has made it feasible to develop new products and find new ways of distribution. Since devices and cloud computing technology are already available, IoT is very much a reality that’s delivering great results to industries. It is helping solve real-world problems ranging from traffic issues in cities to data sharing in remotely located factories. 

AI and IoT are providing enterprises with a definite edge over competitors and helping them become industry leaders. Adopting AI has become necessary to survive in this competitive world. Several offshore companies offer customized artificial intelligence solutions to assist SMEs in unlocking the power of data and increase returns. 

Using AI to Move IoT to the Next Level 

Let’s see the role of AI in IoT and how artificial intelligence can move the Internet of Things to the next level. 

  • Risk Management 

Risk is a part of every business. Be it the safety of the workers, maintenance of heavy machinery, unexpected market conditions, or fraudulent transactions, IoT and AI help businesses understand and predict different risky scenarios in the enterprise. This makes them aware of what all could go wrong and how they can prevent it. Data is collected from sensors in the factory, devices worn by workers, transportation vehicles, computers, etc. This data is analyzed using AI to alert the management in time and prevent an accident from happening.  

  • Increase Operational Efficiency 

Automation has changed the way work is done in enterprises. Instead of putting excess pressure on employees to complete the recurring tasks, the process is automated using artificial intelligence. As a result, employees have more time on their hands to take up complex tasks and be productive without getting stressed out. AI and IoT together assist employees in identifying tasks that can be automated and fine-tuned to increase efficiency. In addition, understanding patterns and processing data in real-time facilitates management to make faster decisions.  

  • Make IoT More Scalable 

Artificial intelligence can make IoT scalable in an enterprise of any size. A range of the device can be used as a part of the IoT network. Whether it is a mobile phone or a high-end computer, it serves the purpose when powered by AI. In fact, many organizations use low-end sensors for data collection to manage costs. AI reduces the large volume of data to a manageable level and allows you to add as many devices as necessary to the IoT network. 

  • New Product/ Service Development 

AI and ML solutions use data from IoT to identify patterns and trends in customer behavior. This helps you in developing new products/ services that are useful for customers. It also helps in making changes to the existing products/ services to attract more sales. We can say that using AI, especially NLP (Natural Language Processing), to understand customer behavior will help manufacturers streamline their R&D. Rolls Royce, the British luxury automobile manufacturer, has been using IoT and AI to develop new aero engines. 

  • Reduce Costs Due to Downtime 

Broken and damaged machinery causes a lot of loss for manufacturers. The only way to prevent unexpected machine breakdowns is by implementing preventive maintenance. But how does the management keep track of so many machines and their maintenance? That’s where IoT has been helping by collecting data about every machine used in the factory. Even companies like Deloitte use AI with IoT to manage the extensive IT infrastructure and prevent downtime. 

  • Real-Time Data Analytics 

As we mentioned earlier, AI companies offer real-time data analytics using customized AI-based tools and software. Data is collected from several sources, counting the internet and devices in the IoT network. To successfully adopt the data-driven model in your enterprise, you will need an IoT network that continuously sends information to AI software. Artificial intelligence ensures that derived insights are meaningful and useful for the enterprise.  

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  • Balance Personalization and Data Privacy 

We live in a complex world where customers demand personalized products and services. At the same time, people are becoming more aware of data privacy or the lack of it. So how can a business provide customized services and respect the customer’s data privacy? IoT is all about data collection, and AI is about analyzing this data. However, by using advanced technology, you can find the thin balance between using AI for personalization and not intruding into the customer’s life. 

  • Enhance Data Security and Prevent Cyber Attacks  

If data privacy is one concern, data security is another. AI in IoT applications can help you increase the overall security of the systems and prevent hackers from stealing your precious data. You will know which part of the network is weak and needs more protection. You can add multilayer security and provide restricted access to employees and stakeholders. Get alerts about attempts of cyberattacks and block them before the hackers gain entry into your systems. 

  • Increase Customer Experience 

When you know which products are more in demand by the customers, you cannot run out of stock. This is achieved using devices to monitor stock movement in the warehouse and retail stores. AI helps with predictive analytics to measure the stock you’ll need to meet customers’ demands. For example, surveillance cameras can tell us about the shelves customers are the least interested in. 

  • Robotics in the Manufacturing Industry

Manufacturers are already adopting AI, IoT, robotics, and more to revamp their manufacturing process. The aim is to reduce the production lifecycle and cut costs without compromising on quality. Robots are provisioned with AI and ML algorithms and also act as data collectors in the IoT network. We are set to see many more developments in the manufacturing industry. IoT and AI’s future look bright as more industries actively invest in robotics and edge computing to give their competition a tough fight in the market. 

  • Make Better Business Decisions 

The ultimate aim of investing in advanced technology is to make the right decision for the business at the right time. Rather than relying on historical data or instinct, make decisions based on accurate insights provided by AI systems. AI and IoT companies provide the necessary support to make this possible. 

  • AI and IoT in the Medical Field 

The medical field has seen a wider adoption of AI and IoT during the last year or two. The spread of pandemic has sped up the process, pushing more research centers and healthcare organizations to improve their efficiency and be prepared to handle the crisis. AI in IoT research papers, like the one providing solutions to handle the Covid-19 pandemic, proves that the medical field is extensively using artificial intelligence and machine learning to develop new drugs, provide better treatments to patients, and reduce the workload of nurses and doctors. 

  • Retail Analytics, AI and IoT 

If surveillance cameras are part of retail analytics using IoT, dynamic staffing can quicken the checkout time and increase productivity. It also helps in optimizing resources to increase profits. The combination of IoT and AI services empowers retailers to manage their stores like never before. And since many retailers today also accept online orders, it helps them sync data across the business and stay up to date at all times. Inventory to invoices to reward points and accounts, everything can be handled with ease.  

  • Self Driving Cars in the Transportation Industry 

The world has been talking about self-driving cars for a long time. Tesla’s latest self-driving cars have proved that these are no more a prospective or a future trend. Nothing can be a better example of combining AI and IoT to develop a smart machine that can drive through any kind of traffic.

Top Brands That Use AI for IoT 

Many leading brands in the market are using AI to empower IoT. The following are some AI and IoT examples

  • The search engine giant Google has replaced humans with AI technology to control the cooling of data centers. These data centers hold information from YouTube, Gmail, and Google Search. 
  • Rolls Royce, the luxury automobile marker, is reaping AI and IoT benefits by using sensors to extract data from engines. This data is used to build aero-fleet engines. 
  • DHL, the leading logistics company, uses advanced IoT with AI for Smart Trucking operations to ensure a quick delivery. The company has already reduced 50% of the transit time by using real-time tracking.  
  • Walmart, the largest retail chain in the US, uses AI and IoT solutions to seamlessly integrate and manage thousands of offline and online stores across the country. The retail chain has shown a significant increase in revenue by investing in AI to use IoT. 
  • London City airport and Shell Corporation have been using AI and IoT in different ways to facilitate their core business processes. 


When used with artificial intelligence, the Internet of Things will deliver long-term results to organizations and factories in several industries. A business from any sector, ranging from manufacturing to medical, can use IoT and AI for innovation, risk management, and operational efficiency. 

Hiring an artificial intelligence consulting company will give SMEs and large enterprises the necessary support to adopt advanced technology in their processes and improve their overall performance. 


Kavika is Head of Information Management at DataToBiz. She is responsible for the identification, acquisition, distribution & organization of technical oversight. Her strong attention to detail lets her deliver precise information regarding functional aspects to the right audience.