ACCA Applied Knowledge · Business and Technology · Technological factors
A manufacturer of household appliances adds sensors and internet connectivity to its washing machines so that they report faults to the company and allow it to offer remote diagnostics and predictive maintenance. Which term BEST describes this development?
This is the Internet of Things. Physical products such as washing machines are fitted with sensors and connectivity so they send data over the internet, enabling remote diagnostics and predictive maintenance. It is not outsourcing, EDI or vertical integration, which concern different business matters.
- AInternet of Things (IoT)Correct
- BBusiness process outsourcing
- CElectronic data interchange
- DVertical integration
Explanation
Embedding sensors and connectivity in physical products so they collect and exchange data over the internet is the Internet of Things. EDI is the structured exchange of business documents between organisations, outsourcing is contracting out processes, and vertical integration concerns the supply chain ownership.
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