Internet of Things (IoT) is no longer a shiny technology conversation. It is becoming a strategic initiative within the business and an enabler to move organizations forward towards digital transformation. If organizations are thinking about transformation and reinventing themselves, there is a high chance that they are thinking about IoT.
IoT is no longer a transnational experimental project. Many organizations started their IoT journey by adding some sensors to their buildings and perhaps doing some exciting stuff with their lighting system. However, this is no longer the case.
Organizations found that IoT can be much more strategic on how to do business and even perhaps finding new ways of transacting with their customers. They can now think of different data and information that they can gather which was not even possible before. They can start using analytics and big data platforms to categorize those data and apply business intelligence tools so they can make more informed decisions.
Organizations now can make more strategic decisions on board level, via the tools that IoT can offer them. This is a unique positioning and a lot of startups are emerging to work exclusively on different aspects of IoT. As a matter of fact, the IoT landscape is so wide, that no single vendor can handle a project on their own. This is the nature of IoT engagement and you will have at least three to four vendors involved in a single project. This means the complexity of the IoT project is relatively high both in terms of technical details and organizational structure.
Having said that, IoT is becoming more mature and more strategic for leaders and they are determined to use this technology as a driver for their digital transformation. There are different ways that we can achieve this. If you are having these conversations at the business level, it means you are in the right direction and to the right path on harnessing the power of IoT.
We are producing more data in the history of mankind than any other era. billions of people are using smartphones and internet broadband is becoming the norm in every house. People have more than 10 devices at home that are connected to the internet and their functionality is depending on the internet. This means we are producing more and more data that organizations are keen to capture. For them, this means new business opportunities and if they can capture these data at the edge (closer to the end consumer) they can start to see some interesting patterns on how people are behaving and how they can shift their business activities towards that path. For example, the fact that buyers checking prices of the goods before purchasing from retailers is an important behavioral shift that retailers should know about so they can start doing something about it. Imagine if a retailer does not react to this new digital trend. The consequence will be revenue loss which will take the business out no matter how big they are.
Retailers should react to this trend in different ways. For instance, they can use IoT to find out who is moving towards the store or their branch and then by exploring the history of their browsers or apps they installed on their phone and the history of their previous shopping, they can start to make guesses (big data analysis and AI) that what will be the next possible steps for this potential shopper and then they design customer experience and customer journey based on this information. This simply means more revenue and more opportunities for businesses to explore other market segments as well.
Connect the Unconnected
Organizations can now think of how they can connect the devices that are not connected to the internet and start to see the true business value of all these “things”. Imagine that the lift companies can now connect all their lift fleet to the internet via lots of sensors and start to see how they bringing value to the organization. They can see which product family or which model is doing better and more profitable, more stable, and needs less maintenance. This means more profit margin for the organization because they now can use more of these profitable lifts in their projects. In addition, by using analytics and predictive maintenance technology, organizations can be more proactive rather than reactive and fix issues before they happen! This will put organizations in a strategic position so now they experience less drama and downtime which leads to higher productivity for their customers. This will be the starting point for organizations to improve customer satisfaction and customer experience as they become more proactive in their business.
Disrupt the Disruptor
IoT will give the leaders the chance to start thinking about how they can be disruptive to the market as well. A great example is the weather app. One of the weather companies that give information on the weather on smartphones found that users will check weather conditions more than 4 or 5 times per day. But every time they check the weather, they use the app only for 3 to 4 seconds. This means the value is there, but not in the form of weather information. So they decided to use big data analytics and AI to see if they can find patterns of behavior for their users. Surprisingly, they found that on rainy days people buy more umbrellas and apples! Now, we all can understand why people buy an umbrella on a rainy day but there was no firm answer on why people buy apples. However, the company started to find all these interesting patterns and they started targeted advertisements on those behaviors. The result was increased revenue and publicity in the market, but not the weather market, advertising market.
Now this company is exploiting the advertisement market by using data and analytics in a different and disruptive way which was not possible before.