Among the companies we surveyed, the ones that are relatively mature in the IoT space exhibit seven distinct characteristics.
First, they digitally reimagine their business and produce substantial value for customers – not just for themselves. To fully realize the benefits of the IoT, companies need to be mindful of what customers want – ease of use, cost savings, preemptive maintenance, and so on. This aspect is the fundamental principle to designing IoT centric models that create a channel for ‘value exchange’ between the company and its customers.
Second, they deliver the value thus created through new business models, product and service offerings, product bundles, and data. Once the ‘value driver’ is recognized, IoT leaders design new business models and offering portfolios to benefit their customers, enhancing their own profitability in the process. IoT technologies help companies recognize potential revenue opportunities and fine-tune their business strategies, making positive changes in their marketing, sales and service processes.
Third, they are more likely to see the breakthrough potential of the Internet of Things in getting the truth on how their products and services are performing in the market, and how these are being consumed. In the pre-IoT era, companies gained only partial visibility into the market performance of their products and services, by way of customer care centers and sales personnel. Now, with the capability to embed sensors across the value chain, companies can secure a comprehensive and accurate view into how their offerings are being consumed and whether or not they are meeting customer expectations. Also, companies can use these insights to redesign their offerings for market suitability or even avert a major market failure.
Fourth, IoT leaders organize themselves to act rapidly based on this performance and customer usage data. Companies can now fix a customer problem quickly on the field or before the customer is aware of it thanks to IoT technologies. This type of preemptive maintenance can go a long way in enhancing usage experience for customers, thereby bolstering their brand loyalty. The key to doing this is to have a keen focus on Big Data and analytics, and be ready to act quickly based on these insights.
Fifth, they are better at dealing with internal resistance to hearing the truth that IoT technologies reveal about product and service performance. This helps them fine-tune their offerings for better market uptake. Companies that are leading the IoT space are driving these initiatives right from the top and regard ‘organizational inertia’ as the chief hurdle that needs to be overcome to achieve success.
Sixth, they make the IoT reliable in the field, especially to reduce the risks of security breaches. The ‘connectedness’ it brings about makes the IoT vulnerable to data leakage and software hacking. Evaluating the likelihood of a breach and deploying appropriate risk avoidance and mitigation measures, is therefore of prime importance. Several IoT leaders have made early inroads in this aspect and have made smart moves like acquiring niche software security firms and creating specialized innovation centers.
Seventh, they make small test investments before making broader and bigger ones. This approach ensures that any probable pitfalls are identified earlier on, and are fixed before a large scale initiative is undertaken. This in turn, allows companies to explore newer opportunities and stay ahead of the competition.