CHIEFIOT Leadership Forum members are a diverse and respected panel of IoT experts. Each month Chief IOT asks the Leadership key questions C-Suite leaders need to know. This month, we start with the basics: “What is IoT Strategy?”
What is IoT Strategy?
The Internet of Things (IoT) is a term used to describe a wide range of applications such as connected consumer products, home automation and a variety of industrial applications. It enables new applications and services by connecting products and sensors to the Internet and leveraging cloud platforms to monitor and control the connected devices. What makes IoT relevant now is the reduced costs and increased availability of sensors, connectivity options, and cloud infrastructure that has resulted from the scale of the mobile phone ecosystem.
Developing an IoT strategy is no different from previous technology shifts. It boils down to developing a business plan to take advantage of the emerging platforms and technologies to enable new products and services that were not previously possible. Although you need to have a solid grasp of the capabilities of the technology, an IoT strategy needs to be grounded in traditional business theory. Clearly defining the value proposition of the product or service and developing a sustainable business model to deliver value to your customers are the key ingredients needed for an IoT strategy.
By 2020, an estimated 50 billion devices around the globe will be connected to the Internet. Perhaps a third of them will be computers, smartphones, tablets, and TVs. The remaining two-thirds will be other kinds of connected “things” like sensors, actuators, and newly invented intelligent devices that can monitor, control, analyze, and potentially optimize our world.
The arrival of the “Internet of Things” (IoT) represents a huge economic and transformative shift that combines the 50 Billion connected devices with other major technology shifts such as cloud computing, big data analytics, and mobile communications. IoT Strategy is simply finding the answer to the question “how will your company or organization build value in this new connected world”? That will depend on the type of business you have today, the capabilities you can develop for tomorrow, and, most of all, your ability to harness or develop the skills it takes to create services, solutions and uses for these various technologies.
Internet of Things strategy is a plan to use IoT technology to create competitive advantage.
Internet of Things technologies is making the threat of new entrants permanently substituting their product for an incumbent’s product higher than it has ever been. The disruption is already well underway for scores of sectors in both consumer and B2B. As products become connected, value derived from the product or service can fundamentally shift to something much more valuable and more powerful, an information product. When products send their information to networks the knowledge produced from the information can rapidly become more valuable than the original product.