by Mark Benson
Although it has been known under different names over many years, the Internet of Things (IoT) is suddenly the thing. The ability to connect, remotely manage, and monitor networked devices via the Internet is becoming pervasive. And the incredible rate at which the IoT is growing has simultaneously created one of the biggest threats and opportunities for growth in recent memory.
However, building an IoT solution is complicated. Sensors, short-range RF networks, gateways, security concerns, web services, information technology (IT) maintenance and monitoring, web and mobile application development, and enterprise software integration are all parts of the system that must be solved, and doing so is non-trivial.
Enterprises seeking to enter the IoT space often have expertise in building durable goods for specific industries, but not necessarily expertise in networking technologies, sensors, web development, or IT in the service of Internet-connected equipment. Additionally, these enterprises are often diverse and have numerous divisions, product families, and business models that only further complicate the prospect of becoming a world-class connected product company.
Here are nine best practices that multiunit enterprises face when developing and executing a company-wide IoT strategy across diverse business units:
- Develop a long-term, company-wide IoT strategy so that there are clear goals and tangible steps to get there. Communicate this strategy effectively, consistently, and through multiple communication mechanisms throughout the organization.
- Align the organization around the company-wide IoT strategy ensuring that groups and individuals are empowered to make a difference. Many companies choose to create a separate IoT council or IoT division with a charter to transform the company. If an organization is not aligned around its IoT vision, failure is certain.
- Identify key, reusable components that can be leveraged across multiple divisions. Multiunit enterprises cannot afford to build numerous IoT platforms with overlapping functionality. Leading organizations identify and promote reusable components that help division-level programs get to market faster and more cost-effectively.
- Create both a technology framework and an organizational culture that promotes cross-divisional collaboration. The IoT has the distinct advantage of requiring collaboration in order to be successful since its success depends on inputs from marketing, sales, engineering, manufacturing, IT, finance, and support. Breaking down walls and fostering cross-divisional collaboration is key to the success of corporate-wide IoT initiatives.
- Develop a standardized process to understand, compare, evaluate, and select potential IoT projects in order to develop a long-term product roadmap. Leading organizations encode new process elements into their standard product development processes so that the organization more easily embraces the IoT in their natural course of business.
- Centralization. Centralize important functionality, platforms, and tools (e.g., IT, support, continuation, security, tools, and documentation). Concentrating these types of reusable pieces into a corporate-wide framework is a lynchpin that makes it so IoT projects are not just possible, but also make the organization more efficient and competitive. This type of centralization can turn a fragmented and diverse organization into a focused IoT powerhouse.
- Decentralization. Although centralization of core functionality is a key characteristic of successful corporate-wide IoT initiatives, equally important is the decentralization of division-specific IoT elements that cannot or should not be rolled up into a corporate platform. Examples of this include specific sensing technology that is unique to a division, industry-specific user experiences, integration with specialized business systems, legacy business models, and partnership-driven distribution strategies.
- Standards. Develop a consistent user experience across all products by creating reusable brand elements and documenting brand standards. As IoT programs proliferate within a company, the user experience brand elements also tend to fragment. Leading organizations develop standard visual frameworks for how users interact with their products as well as technology standards such as security protocols and APIs that normalize device-to-cloud communications.
- Metrics. Understand and address business-level implications of moving from a product-based revenue model to a services-based revenue model and define corporate-wide innovation metrics that measure not only short-term gains achieved from deploying connected products to increase revenue or reduce expenses, but also metrics that measure and reward investments in long-term success. Embracing the IoT is an investment in long-term competitive success and requires metrics that measure both short- and long-term success.
Turning a multiunit products company into a thriving services company enabled by connected products is an endeavor that requires competitive foresight, clarity of vision, strategic alignment up and down an organization, and perseverance in operational excellence across divisions. Companies that embrace the IoT as a journey as opposed to merely a destination are best equipped to allow IoT innovation to turn organizational challenges into market-disrupting opportunities.
Mark Benson is the CTO of Exosite.