Imagine that you provide concrete cutting and sawing services. As a renowned company, you look to achieve a competitive edge by equipping your crews with iPads, equipped with enterprise mobility management (EMM) solution. It will improve tracking of employee time, let customers know when your crew will arrive and let you invoice accounts right after the field job is done.
The Internet of Things (IoT) is an enterprise hype cycle heavyweight champ. IoT involves the use of wireless connectivity and cloud services with devices like sensors and cameras. An IoT platform’s native capabilities add intelligence to all kinds of technological or ordinary objects – whether at home or in business.
Do you see the involvement of IoT technology as a part of your company’s future? Do you feel like you are going to be left behind if you don’t embrace it?
IoT market projections vary widely, but by almost any standard they are amazing:
Although IoT adoption reaches a fever pitch, businesses of any size need to be careful. They should avoid the shiny-object syndrome and first address the most critical issue in IoT: how is an IoT implementation going to earn an ROI and create a sustainable business?
Ideally, any IoT investment results in an ROI that includes cost savings as well as growth opportunities for new products and services. But there are other things which one should consider to increase an ROI faster. Some of them are:
Breakthrough technologies are often attractive. But, as said earlier, executives and other key decision-makers should be careful of falling victim to the shiny-object syndrome. They should rather assess the IoT technology’s implementation output as they do for any capital expense. Define the goals and strategic objectives for your company in a systematic process. Ask yourself, “Where’s the pain point?” and “if the problem needs to be eliminated, will an IoT ecosystem implementation solve it?” The answers are key to estimate what your company will gain from an IoT solution.
The ‘gains’ will either result from expense reductions or revenue increases and may have a positive impact on both in best-case scenarios. While measuring gains, in addition to direct cost savings, managers should also take in indirect costs for calculating a ROI holistically. Let’s say, an IoT setup allows you to streamline operations so naturally that you will end up keeping fewer field technicians, thus securing direct savings of technician salary/benefits. Needless to say, fewer assets (office space, fleet vehicles, etc.) and a smaller quantity of internal support services (HR, IT, operations and maintenance management, etc.) are all savings that should be included in the ‘gains’ wing.
With business goals stated, executives can set out to prioritize implementation. However, setting up IoT may prove costly, if an IoT setup implementation art is not mastered. Meaning, are you sure that:
A wise decision would be to start with a smaller list of priorities and align them with established business goals. It will also help implementation team to focus and achieve goals in time.
The key takeaway is setting precise implementation projections can help a company to develop a realistic ROI timeline.
An IoT ecosystem implementation can lead to a drastic shift in the way a company operates. As a result, speed must be included in any ROI discussion. Supposedly, you look to apply predictive analytics or artificial intelligence (AI) for a better customer experience. To do that precisely, what you need is a massive availability of historical data. Moreover, the more accurate, relevant and varying type of data you will make available to the IoT platform in the least amount of time, the earlier you will achieve sought-after payback.
In all, whether you aim to optimize a process, detect a failure in advance or monitor machine productivity in real-time – make sure your IoT setup has a high supply of data in volume, variety, and at a reasonable velocity. A consistent monitoring and an improvement in 3Vs ensure a significant ROI in a minimum amount of time.
By 2030, IoT may add $14.2 trillion to the world’s economy, Accenture estimates. With such a large number, it is vital that companies treat IoT as importantly as any other investment and perhaps more so. Companies can surely drive measurable ROI within their business by setting goals, priorities, understanding implementation necessity and costs as well as monetizing their investment faster.
With the increase in adoption of the Internet of Things (IoT), companies from all industries now have a question – which IoT business model and application is right for them? Check out this whitepaper to know what, why and how of IoT business models.
In this whitepaper, we have covered some important elements you should consider when looking to transforming your business model.