I don’t know about you, but I am getting tired of technology buzzwords. That is tough to admit, given I focus on emerging technologies every day. The term internet of things (IoT) has gone from buzzworthy to flatline because it was supposed to herald massive business transformation that to date has not lived up to the hype. IoT by itself doesn’t describe the complexity hidden across connected machines, products and data, and it leaves out the most important component: people. To date, the focus of most organizations has been on data that might potentially lead to new business models or insights. While some have seen success, many are thinking about IoT the wrong way. A recent survey by Avanade and Wakefield found that 79% C-level executives and IT/business decision-makers are not completely confident their company has the capabilities to fully leverage the IoT in a way that will provide a measurable business impact.
So, what has been wrong with the current approach? Many companies believe that they need to shift away from selling hardware, for example, as a primary revenue stream and that the data they obtain from those products will provide insights to create new types of services for their customers. That is a valid hypothesis, and there are several examples where that has been successful. Many of these examples center around operational efficiencies and predictive analytics, such as an oil and gas company that was able to generate an additional $100 million in revenue by adding sensors that processed over one million predictions a day to its facilities, improving output and significantly reducing downtown.
While that is a fantastic result, it focused solely on data. Data is only the beginning of a business transformation journey. To realize true transformation, your organization needs to think beyond the data and just ensuring that you can prep, ingest, store and then analyze it. True transformation comes as a result of an organization focusing on its people and processes and rethinking its systems to extend what is possible today from the cloud to the edge.
In fact, you could argue that the “edge” is a new buzzword, but really it’s about bringing to life a seamless end user experience that can start and finish anywhere, regardless of connectivity. A great example is the US fast food company Chick-fil-A, who needed to manage the scale of their business and ensure great customer service by having the food hot and ready for their long lines of customers. As part of its business transformation, the company focused on the food prep employees and built a new process and systems architecture to allow “smarter kitchen equipment [to] collect more data. By applying data to [its] restaurant, [they] can build more intelligent systems. By building more intelligent systems, [Chick-fil-A] can better scale [its] business.” Instead of thinking just about the data, it was about people, processes, and re-thinking the systems architecture from the cloud to the edge.
Don’t use IoT as a pseudonym for your business transformation. Instead, expand your definition to include these components, as Chick-fil-A did:
- Start with people. Don’t just focus on the technology. Who are the customers or employees and how will they be impacted by the change? What can we do to empower them with a better experience?
- Rethink the business process. Examine the entire business process and identify the points of friction based on interaction with people. In the Chick-fil-A example, this was for the employees who cooked the food. It’s not just about the systems; this is about the interaction of the people with the systems. You need to focus on both.
- Think new systems without boundaries. When designing new applications or systems, we usually limit ourselves with constraints. In today’s world with cloud and being able to run applications at the Edge, don’t worry about barriers. You can extend experiences that follow the individual wherever they are at.
A few years ago, we may have thought that IoT was the game changer, but today we know it was just the beginning of the journey. You need a place to store and process that data, but more importantly, organizations need to think about the entire end-to-end transformation that embraces a new way to think about systems change that will deliver on the original promise of IoT.