Internet of Things (IoT) is not a strategy. Neither is mobile, social or any other combination of technology. You can’t have a business-funded project around it because you can’t attach a specific positive business outcome to it. This really hit home in a GigaOM article just this morning, The future of mobile commerce is commerce. Author Cormac Foster argues the following:
When it comes to mobile commerce, technology is not a strategy, and while a lousy checkout can definitely lose a sale, a good one is rarely the reason a consumer decides to buy.
This same idea applies to the IoT. The technologies that enable companies to take advantage of sensor and machine to machine data aren’t a strategy…they are a requirement for competing in an increasingly competitive, increasingly automated and increasingly global market.
Strategy generates revenue
Strategies are how we execute our business, not the technologies that support execution. If you still don’t see it, think of a soccer match. The strategy to win the game has little to do with the material in the clothing, the shin guards or the fitness level of the athlete. Soccer strategy assumes those things and uses them to create competitive advantage. Shin guards don’t score goals. The IoT doesn’t generate revenue.
Once we accept that IoT isn’t a strategy, we can start to see it for what it really is…an investment in technology that needs to be connected to a better way of doing business. If you miss this connection, you’ll struggle to justify the spend necessary to compete now, but more importantly, a year or two from now. Treat it as a checkbox no different from having each employee digitally connected.
Tools enable strategy
The IoT is going to fundamentally change how business is done, just like mobile has changed retail. First, figure out the strategy that the business needs to execute using all of that new information the IoT affords, and then figure out how to create the capabilities to move data, analyze data, create predictive capabilities, watch data as it happens and respond to opportunities and risks in the moment.
Think big and then figure out how to deliver it. Delivering will involve lots of infrastructure change to integrate, analyze, predict and act in real-time. That spans many products and will require real investment, but at least you’ll know why you’re doing it.