The Internet of Things (IoT) and Digital Transformation (DT) are very hot topics that are on the radar for the vast majority of businesses. The interesting thing, however, is that successfully implementing or embarking on an IoT or DT journey, and obtaining an ROI that will positively impact a business, requires more than the technology or system changes alone.
Many companies begin an internet of things (IoT) journey with great expectations, only to end up with disappointing business results. Gartner recently estimated that through 2018 “80% of IoT implementations will squander transformational opportunities” and fail to monetize IoT data. And a new survey by Cisco found that one-third of all completed IoT projects were not considered a success.
Since most IoT initiatives are built to better serve the needs of customers, partners, suppliers and the like, it only stands to reason that the best IoT solutions are built outside-the-box. In the end with IoT-based implementations, to build trust with your customers requires building trust across the panorama of the IoT ecosystem-at-large first.
Companies deploying IoT successfully in industrial sectors such as manufacturing, oil and gas, mining, and transportation are seeking multiple agile partners with open IP architectures to co-create solutions. This approach lets organizations aggregate best-of-breed technologies to develop cost-effective solutions that advance their goals.
For example, the employee safety solution deployed by Marathon Petroleum with its integration partner keeps track of workers’ locations and automatically broadcasts safety alerts by combining data from Wi-Fi, wearable gas detectors, motion sensors, wireless networks, and real-time location systems, which are all sourced from different suppliers.
IoT requires new technical skills, ranging from data science and systems architecture to cybersecurity. Equally important, however, is the need for technology experts who possess both the business and the people skills to collaborate across groups inside and outside the enterprise’s four walls.
IoT solutions tend to span information technology (IT), operational technology (OT), and core business functions. These groups must work together. Thus leading IoT adopters are increasingly bringing these functions together at an organizational level, creating new roles and hierarchies.
Last year, BP-Akers, the Norwegian petroleum company, created a new executive position, SVP, and chief improvement officer, to spearhead the alignment of its digital and IoT functions. In addition, several manufacturers have recently created a new frontline role, IT manufacturing engineer, with dotted-line reporting to both OT and IT.
IoT technology is very cool. But chasing the cool factor can lead to compromised ROI. One example is that a U.S. city installed a state-of-the-art inflow and infiltration system in its manholes, which is a very cool solution that worked as designed. But the city didn’t realize the promised benefits.
The new below-ground system wasn’t integrated with existing processes above ground. Street sweepers continued to operate as they always had, clogging the inflow holes with leaves and dirt, which is not so cool. If IoT partners focus on the business challenge, they will capture new levels of ROI.
Successful Internet of Things deployments and implementations start with a successful organizational belief system. A corporate culture that imbues and rewards innovation, collaboration, and trust is mandatory, as IoT projects require all of these attributes in order to flourish. For successful IoT initiatives though, it is far more important to innovate and collaborate with external partners than just those stakeholders inside one’s own organization.