By Steven Ramirez, CEO, Beyond the Arc
By 2020, more than 50 billion connected devices will be helping executives to solve problems in all kinds of industries. Items like the Nest smart thermostat or Tesla’s self-driving car are just some of the first technologies to garner widespread attention. Right around the corner, we can expect to see new Internet of Things services that deliver convenience to consumers, and shake-up traditional business models. For CIOs, and their c-suite colleagues, now is the time to get prepared.
Here are 5 fundamentals to consider when reformulating your corporate strategy to reflect new Internet of Things capabilities:
1.) IoT offers new ways to solve tough problems.
With limitless potential, the real value of IoT will come from addressing concrete consumer and business needs. It’s best to start with a clear statement of the challenge and consider IoT as just one way of addressing it. A question to get you started: how can your customers benefit from real-time interaction?
2.) IoT will produce a deluge of new data.
IoT is already transforming operational and organizational requirements. It’s imperative to have strategies for monitoring and managing this data, and analyzing the data to obtain actionable insights.
The data flowing from connected devices has huge implications for data management and analytics. While many organizations think about storing the data and generating reports, far fewer think about new ways to analyze the data to gain insights.
While a network of connected vending machines can make monitoring maintenance needs easier, and lead to just-in-time replenishment, what can that data tell you about consumer behavior? It might tip you off about the buying patterns of certain products at certain times of day, helping to optimize inventory selection. Or better yet, perhaps your smart vending machine leverages a new algorithm that enables dynamic pricing for every item.
3.) IoT increases revenue potential.
From retailers to financial institutions, Bluetooth beacons are helping businesses collect specialized data such as product performance, buying trends, even consumer movement. These insights enable them to better adapt store layouts to drive sales, and push in-the-moment offers when customers are nearby. If you have a brick-and-mortar presence, you can move beyond rudimentary market segmentation to a highly nuanced understanding of what customers are interested in as they move through your stores.
4.) IoT delivers cost savings and more.
For many companies, the return on investment of IoT is coming from driving down costs and improving operational efficiency.
Logistics, inventory, maintenance, and other critical value chain activities can be turbocharged with IoT data, and the resulting business insights.
Think about the ability to lower energy consumption, and cost, with smart buildings. Not only can we monitor how facilities are used today, we can make better predictions on future use. And the power of predictive analytics allows us to make a prediction of the demand for air conditioning on a given floor, on a given day. We can aggregate that data to understand annual patterns, and when those systems are connected, we can monitor when systems fail and act more promptly.
5.) IoT enhances customer experience.
The Internet of Things is less about connected devices and more about the services they enable. It opens the door for real-time insights and issue resolution, and more actionable analytics so businesses can proactively engage customers with more relevant communications.
The pace of change is accelerating when it comes to connected devices and services. Agile organizations will recognize the opportunities, and act. But those companies that will rise to a position of leadership will harness big data and analytics to fundamentally rethink their strategy and approach to the market. With IoT, there will be winners, and a few really big winners.
“With IoT, businesses are able to continually engage customers and drive new revenue streams, as well as gather and analyze data to improve productivity, efficiency, and service reliability.”