IoT and Big Data needs to be on the CEO and Boardroom Agenda
In the public arena, much of the discussion to-date has been about the technology related to IoT and Big Data. We are also starting to see discourse and use cases coming through with regard to actual implementations and benefits to businesses. However, the conversation remains very much in the tactical realm and also largely confined to agendas of CIOs.
At the recently concluded Live Worx 2015 conference in Boston, Professor Michel Porter and Jim Heppelmann President and CEO of PTC provided one of the most interesting keynotes I have come across in recent times. They highlighted how IoT enabled connected products are in fact at the heart of competitive strategy of business and also made a number of references to the their recently published HBR Whitepaper - How Smart Connected Products are Transforming Competition. There were many take-ways from the keynote, but two things highlighted to me more than ever, the importance of Internet of Things and Big Data Analytics discussions needing to be on the agendas of CEO's and Boardroom's.
Who will be your competitors in the future?
Will your product or service offering to the customer be as relevant tomorrow as it is today? This is a question that has been on the minds of many business leaders well before the advent of the IoT. However, IoT and other disruptive technologies in general has made it possible for a competitor to provide a substitute that is far superior in terms of overall customer value compared with your current product offering. As Jim Heppelmann said "there used to be a pedometer business"! Now pedometers have been surpassed by wearable technology such as the Fitbit. Smart, connected wearable devices that offer the ability to keep track and analyse a suite of your own bio-metrics not just the steps. The pedometers came into the main-stream market in the 90's and fast forward to present day, how many of the early pioneers of the pedometer business are poised to play a dominant role in the wearables market today?
When will you change your business model?
Industry boundaries are shifting rapidly. If you take the agriculture and farming industry for example, most organisations are in the business of providing inputs to the farming process. The HBR whitepaper also provides a great example of how John Deere who has traditionally been in the agriculture equipment business is moving from an input related business selling farming and agriculture machinery to a business that is service oriented and much more closely aligned to successful farming outcomes for their customers. John Deere is making this transition by beginning to connect not only farming equipment but also irrigation systems, soil and nutrient sources with information on weather, crop prices as well asinformation on commodity futures to help farmers optimise overall farm performance. This has enabled John Deere to truly differentiate from their traditional competitors and become an even more important business partner for their customers.
Implications for Australian Business
For many Australian businesses this is also a global conversation. With global competitors, customers, partners and suppliers; business operations and value chains are no longer confined to the Australian shores. Scale of the opportunity as well as challenges are global.
The Australian Financial Review recently reported that more than half of the companies on the Fortune 500 have disappeared in the past 13 years because they failed to respond to the disruptive wave of business change driven by digital technologies.Australia's business leaders are discovering they need to dramatically change, with consulting firm KPMG also advising this needs to be a priority at all levels and that boards can no longer abrogate all responsibility for the IT function to the CIO
Is your business looking to take advantage of these disruptive technologies and how are you preparing for the change that these technologies will drive in your industry?
Access the keynote speech by Professor Michel Porter and Jim Heppelmann
Download a copy of the HBR Whitepaper
Find out more about what John Deere is doing with IoT and Big Data Analytics