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Finding a drone use case was relatively easy for The Shelly Co. As a construction materials company, it was already paying third-party contractors to take aerial photos of its crushed stone and sand stockpiles for auditors.
Aerial photographs help The Shelly Co., part of Oldcastle Materials Inc. and based in Thornville, Ohio, determine how much ready-to-sell product it has on hand, which is necessary information for end-of-year reporting. "We apply value to those tons, and they go on our books as finished product -- a bit like a company that manufactures TVs, for instance, will have TVs in storerooms and will apply value to that," said Peter Morse, aggregate performance manager for the company.
Drones can be deployed faster than aerial photographers and can provide a quicker turnaround on the data, according to Morse. And that's not all: "The big difference for us is that, for the equivalent amount of money, we can fly as many times as we want during the year," he said.
But should drones be on every CIO's emerging technology roadmap? Companies that aren't in the business of inspecting inventory in the field may shrug off drones as unimportant -- at least for right now. Gerald Van Hoy, a Gartner analyst, said before CIOs discount the technology outright, they should keep an open mind -- and, more importantly, an open ear -- as to how drones could be applied to the business.
"We're just on the threshold of these being used in commercial settings," he said. "In any industry I can think of, there is a use case -- even if it's simply security around the property."
Paving the way for drones
Although pinning down a drone use case was fairly straightforward for The Shelly Co., rolling out the technology caused a few headaches. The biggest had nothing to do with the technology itself, which The Shelly Co. leases through Kespry Inc., a company in Menlo Park, Calif., that bills itself as an aerial intelligence platform and recently made news when it brought in George Mathew as CEO. (See sidebar.)
George Mathew: Kespry CEO
George Mathew's appointment as CEO at Kespry is a tip of the hat to the critical role data plays for drone companies. Mathew has carved out a name for himself in the data industry, having worked as the COO at Alteryx, an analytics company, and as the general manager of business intelligence at SAP. In a press release announcing the hire, a venture capital partner described Mathew as having "lived at the intersection of analytics, big data and cloud computing, all of which are critical to where the industrial drone market is going."
Instead, The Shelly Co. was concerned about the Federal Aviation Administration (FAA) regulations, which were murky at best in 2015. Companies need to obtain a waiver to fly a commercial drone, a process that could take months. Plus, the FAA was planning to change the regulations, which left The Shelly Co. in the dark as to how it might be affected. "Initially, there was concern from legal's perspective of, 'Are we going to be able to fly these things like we want to?'" Morse said.
But the new regulations established in 2016 known as Unmanned Aircraft Systems (Part 107) loosened commercial drone use. They established basic rules for flight, including that drones stay in line of sight, never exceed an altitude of 400 feet or a groundspeed of 100 miles per hour.
The role of the CIO
The Shelly Co.'s use case is one of the most common drone use cases for commercial use, but Van Hoy said he believes the new FAA regulations remove a lot of red tape for businesses. The oil and gas industry, for example, has embraced the technology, sometimes investing in fleets of a thousand to perform inspections faster, more consistently and without as much disruption to service compared with human inspectors.
"The big difference between humans and mechanical drones is you have the ability to do an array of sensor scans at the same time," he said. "Drones can do a visual inspection, but it can also be doing a thermal, a sonic or ultrasonic inspection; and it could even be doing X-ray or Lidar scans."
Van Hoy said he anticipates the personal and commercial drone market to grow, with global market revenue expected to increase 34% and reach $6 billion in 2017, according to "Forecast: Personal and Commercial Drones, Worldwide, 2016," of which he is a co-author. Indeed, because the wait-and-see period for new FAA regulations is over, Van Hoy said he believes drones are poised to enter an innovation period. Companies will start to think about how to apply the technology to their business and formulate ideas and applications that "weren't even on anyone's radar," he said.
The role the IT department plays is conditional. "I think it comes down to, one, where the data is stored and, two, where the data is processed," Van Hoy said. If the data is processed on premise[s], the IT department will be involved, but if, as is the case with The Shelly Co., the data is processed in the cloud by a third-party, IT departments will have little to do.
Still, having CIOs involved in drone-investment conversations is a strategic plus for companies. Van Hoy encouraged CIOs to see drones as "a flying platform" that can be outfitted with sensors that perform a variety of tasks. But like other emerging technologies, identifying what processes should be automated by drones before investing in technology is key.
As is ensuring the company works off of a universal drone platform. "I generally recommend that with this kind of technology, you look for one airframe that fits all," he said, referring to the drone's chassis. Using a common airframe will require less training, provide more flexibility and businesses will be able to mount different modules onto drone to perform different tasks.
He also warned that the new regulations could open up possibilities for BYOD-like behavior, with employees bringing hobby drones into work and experimenting on how to apply the technology to specific processes.
BYO drones could benefit a company by helping find use cases for the technology, but it could cause problems, as well, Van Hoy said. "In a perfect world, you don't want employees to fly their own devices, because you don't have the kind of legal control you really need to have in this situation," he said. "They are roving eyes." He recommended CIOs help craft a set of situational rules so that it's clear if a drone, say, captures a traffic accident, how the company will treat the information.
Another concern CIOs will have to face is security. "This is a connected device, so it should be treated like any other connected device on your network," Van Hoy said.
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