3 Tips For Defining The Right IoT Strategy

A Utility tower is part of the IoT landscape
IoT connects everything from power plants to toasters

The IoT market has matured over the past three years. Industry leaders are IoT-enabling the business using connected devices, cloud services and analytics to build faster, smarter business processes. These data-enriched processes will improve employee productivity, deliver operational efficiencies and provide new revenue opportunities. Over two-thirds of the IT leaders that Lopez Research surveyed listed understanding IoT’s impact on their business as one of their top strategic IT initiatives for 2017.  However, less than half of the companies that Lopez Research surveyed have a documented IoT strategy with clear use cases.

Do you have an IoT strategy?

Every business must rethink its overall operational and information technology strategy to maximize business value from the IoT. Companies must optimize existing business processes with IoT data and create new workflows to drive the business forward. IoT strategy was the topic of a recent ebook from SAP titled Insights on the Future of IoT where TopRank Marketing asked 21 Digital Transformation influencers, to provide their thoughts on the future of IoT and its impact on various businesses.

The answer is tricky because the use cases and technologies vary dramatically across industries. The wonderful thing about IoT is that it isn’t limited to one type of business or vertical. Every company can benefit from IoT use cases such as improved asset utilization, predictive maintenance and security threat prevention.

I’m most excited about the potential for businesses to create new business workflows by using data from their own internal sources and data mashups with third parties for information such as weather, traffic, pricing and customer sentiment.

There are many excellent points in the ebook that you can read here. For example, Dion Hinchcliffe, the Chief Strategy Officer of 7Summits, discussed how IoT changes the customer experience. Meanwhile, Yves Mulkers, a Data Architect for 7wData, discussed how IoT could improve industries such as travel and agriculture. In my opinion, one of the greatest benefits of IoT is that machines can talk to people in a meaningful way, requiring product makers rethink how every aspect of engagement from sales through support.

Companies approach IoT in various ways

While there’s no single answer to the question, there are at least three ways that Lopez Research’s enterprise clients are approaching IoT strategies. These plans include using the IoT to:

  1. Deliver faster access to existing data. Before mobile and IoT, data was locked in systems that required a person to monitor and manage a device at the equipment’s location. Today, connected devices can talk to systems and individuals. For example, retailers can have up to the minute access to inventory availability and supply chain tracking. A plant manager can view alerts and decide on an action while walking the manufacturing floor. And a telecom provider can analyze network issues in real-time to respond to customer support call.
  2. Improve business with access to new data. In many cases, IoT provides the opportunity to create new business processes and workflows by providing a company with information it didn’t have in the past. For example, Coca-Cola connected its Freestyle machines allowing the company to reduce stock out, understand buying behavior and even provide a new service that allowed its customers to create customized beverages.
  3. Transform the business with new workflows and business models.  IoT offers the opportunity to disrupt industries with new services and business models. One example is how GE has moved from selling jet engines to selling uptime. Another is an extension of an existing model with a new twist, such as an elevator company using IoT to deliver remote monitoring and improved field service.

Fortunately, the industry hype has led to new IoT platform and point solutions from a wide range of established vendors and startups. While a company can’t become an IoT-enabled business overnight, it can build a foundation to support better workflows and fuel business growth with a phased IoT deployment. We’re at the beginning of an exciting journey.

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