Preparing Your Business for the Internet of Things Revolution
Sure, you’ve heard the hype about the Internet of Things (IoT). You’ve watched myriad connected devices get crowd-funded and you might even be feeling some fatigue when it comes to keeping up with the latest popular connected gadget. However, despite all the hype, there are many companies that have launched IoT businesses and are reaping the benefits on a global scale.
“As business value shifts from products to services, the conversation around IoT is also shifting”
In fact, right now you – or your CEO - are probably still thinking about how your company will become an IoT business. In fact, 95 percent of CXOs told that in the next three years they expected to launch IoT businesses.
That’s because the so-called “IoT Hype Cycle” is focused on the shiny new gadgets themselves – not what they enable. And at its core, the Internet of Things isn’t about the ‘things’ – it’s about the services those things make possible, and how those services can change the way you do business.
So forget the hype. The simple fact is that your business cannot escape the transformative effects that the IoT will have on your industry. Within 10 years, every company – regardless of the industry – will be an IoT services business. So, what does that mean? IoT is all about the convergence of the physical and digital worlds, a fundamental shift, that means business value – both to your customers and your bottom line – is becoming less about the actual products you sell, and more about the experiences that those products deliver.
Gone are the days when you could just sell your product to a customer and walk away. Customers now expect you to continue to deliver new benefits throughout the product lifecycle and to be there to support them in real-time, all the time. In short, IoT is all about enabling your organization to evolve from a product business to a service business.
Delivering value-added services to your customers creates significant opportunities. Not only are you able to gain insights and strengthen the relationships you have with them, it also leads to the creation of new sources of recurring revenue. So let’s talk about the steps you can take to embrace IoT and transform your business.
To start, you need to be realistic about the process. A successful transformation from a product business to service business requires new skill sets, business models, structures, capabilities, resources, expertise and alliances. It might seem daunting, but while you may be new to IoT, experts in connected businesses have spent the better part of the last decade developing solutions to directly address these new operational requirements. There’s no need to go it alone, and there are market-tested solutions – including comprehensive IoT platforms – that can make the actual implementation of your IoT services seamless, regardless of your industry.
Ultimately, it’s all about automation. It’s not just about gathering the information created by IoT devices – it’s about converting that information into real-time, actionable insights. Be sure you select an IoT platform that is truly end-to-end, from the collection of data, to the analytics, to the automated action. This will enable your service business to be more agile and responsive to customer needs, while removing systemic delays and preventing issues in advance.
The next consideration is the impact that always-connected devices will have on your business, operationally. When the devices you sell are connected in real-time, all-the-time, automating service management is critical. To optimize for cost and service reliability, each device requires 100 actions, or adjustments every single year. If you manage services to just 100K devices (regardless of whether its cars, vending machines, agricultural equipment, etc.), that means ten million activations, rate plan changes, remote diagnostics, over-the-air fixes, etc. that you need to monitor, manage and to respond to in real-time. The more your business scales, the more critical it is to have the technology and controls in place to proactively address these new requirements.
Whether your business is global today or you want it to be in the future, the most effective IoT solutions enable companies of any size to grow organically, without substantial cost or delay. Be sure to look for an IoT platform that provides a single operational standard and an interface that makes it possible to quickly and cost-effectively scale your business globally.
Finally, you need to think about the specific challenges of your industry. The relative nascency of IoT means that each industry is still identifying and figuring out how to address its own individual challenges. In Healthcare, for instance, there are regulatory issues to work through, in addition to questions about who covers the costs (doctors, patients or insurance companies).
Partnering with a platform provider with a broad scope of IoT deployments across various industries can help you overcome these specific challenges. Custom development should not be required for your company to launch IoT initiatives, if you pick your technology partners wisely. Leading IoT solutions are easy to configure while still meeting your unique requirements. These platforms can enable you to enter the market quickly and with minimal, if any, upfront spend.
Remember, as business value shifts from products to services, the conversation around IoT is also shifting. The industry’s previous focus on the latest and greatest crowd-funded gadgets, is giving way to IoT service businesses that are making the business case for IoT by delivering real impact on a global scale. This puts enormous pressure on companies that are looking to capitalize on IoT to demonstrate that their business models will generate real revenue, deliver high value benefits, and be scalable to the mass market.
But the promises of becoming an IoT services business – new, recurring revenue streams for your business and better experiences for your customers – are not future prospects. They are a reality today. In fact, industry leaders worldwide are already transforming their businesses with IoT.