Why is it so hard to implement IoT on an enterprise scale? 3 Capabilities for success

by Johan Moons on February 2, 2017

IoT is hot! IoT is a business enabler offering enormous value potential! IoT will soon become a trillion dollar market! IoT startups are disrupting entire industries! Act now or be disrupted! 

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Although I agree with the statements above, effectively implementing IoT-enabled business initiatives in an existing enterprise proves to be a major challenge. Such initiatives involve things, people, connectivity, state-of-the art technology and requires a significantly different approach than your average Tuesday morning IT project.

Offering exciting digital services to a new customer segment based on sensor data is an entirely different project category than implementing new tax calculation functionality in the accounting application.

Why is it so hard to successfully launch enterprise IoT initiatives? Here are the three key capabilities we've identified for success:

1. Know-how: Process

Where to start? How to identify new business opportunities? How to translate technological evolution into innovative products or services? How to go from idea to prototype in a limited time frame? How to identify and quantify value?

Creating an entirely new and valuable product or service in the rapidly evolving VUCA world we live in, is a major challenge. Many established companies have launched expensive large-scale innovation initiatives that were abandoned after a while (and a lot of euros) or were eventually completed but considered a failure. Large enterprises typically excel at efficiently providing, supporting and improving core products and services.

Their organizational structure is tailored for this purpose, but is usually not fit for generating, cultivating and implementing new ideas. Large enterprises appear to be struggling with coping with the uncertainty that is an inseparable part of IoT solution creation.

An approach that embraces this uncertainty and deals with it in an adequate way is required. This kind of approach differs significantly from the typical project approach that is practiced in typical corporate environments (focus on scope, ROI, ...).

2. Know-what: Technology

What cloud platform is suited for a new solution? What kind of wireless communication should be used? What type of security is required? What data modelling technique to use?

The IoT domain is in constant evolution: it is a diverse and relatively immature ecosystem of software vendors, startup companies, hardware manufacturers and telecommunication companies. All of the organizations in this ecosystem appear to be offering products that pretend to be THE silver bullet solution to any IoT challenge.

The actual value of IoT (and also the complexity) lies in effectively combining state-of-the-art hardware, connectivity and software into products or services. The technical complexity of creating an IoT-enabled product or service spans multiple software and hardware aspects: hardware selection, device and data security, low-bandwidth communication, setting up and maintaining a cloud platform, handling big data, gathering insights using analytics and visualizing data in an intuitive way.

These are just a few of the challenges that need to be handled in an IoT innovation project. To achieve a successful implementation, strong technological expertise and a focus on architecture & design is a must-have capability.

3. Know-who: People

Who is available? Who is able to handle complexity and uncertainty? Who combines technical expertise and a can-do mentality?

In many enterprises, the focus lies on delivering customer value through the efficient and qualitative execution of core activities. Therefore, people usually belong to a department or business unit, having a clearly documented role and responsibilities within the organization. They contribute to the objectives of their department, while complying to the rules and regulations of the enterprise.

Within this structure, many organizations struggle with finding and allocating the right people to implement innovation initiatives. People are used to working within the boundaries of their organizational structure, but are new to having the freedom (and even the obligation) to operate outside these boundaries in an end-to-end way.

This is approach is ideal for starting new IoT-related projects. But even if the right people are present, they often don’t have the necessary time, focus or resources to be fully committed to creating innovative products or services.

If you're convinced of the value potential of IoT initiatives and the opportunities in this domain, then start making a plan to assemble the how/what/who within your organization.

Complement your enterprise capabilities, with partners that have expertise in domains in which you are less confident.

Assemble a mixed team of dedicated people, provide them with the necessary resources, make sure they are empowered to make their own decisions and provide them with a mission to challenge both the internal operations and the existing customer value propositions.

What's stopping you?

Want to learn more about IoT or find out what IoT-opportunities there are for your business or your market? Get in touch.

 

Topics: Innovation, Internet of Things