The Digital Enterprise and the Future of Work

Charles Araujo

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Dump IoT to get IoT Right

IoT will be one of only a handful of genuinely transformative classes of technology, but only if enterprise leaders get it right

The idea that the Internet of Things (IoT) is somehow a single, simple technology is an idea that many business and even IT executives seem to believe.

In fact, the idea of connecting a ‘thing’ to the ‘Internet’ is so broad, it makes the situation even worse, with organizations applying the term to everything from RFID tags, to drones, to beehive scales — and to every bit of infrastructure that sits beneath each of them.

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While the term seems to imply this single, simple technology, the best way to describe the current state of the IoT sector is “roll your own.”

As I’ll describe in a forthcoming article on CIO.com, putting together a meaningful IoT strategy requires the assembly of a vast number of pieces that span the entire technology stack including hardware, networks, middleware, and applications.

There is nothing simple about IoT.

Why “IoT” Got it Wrong

Even putting aside the complexity of this seemingly simple term, however, there is a deeper problem with it.

Many enterprise executives have reduced the term to a literal interpretation of merely taking a device and connecting it to the Internet. But the core concept of IoT was never simply connecting devices.

From the beginning, it was neither about the Internet or about ‘things,’ it was about data and how we could use that data to transform the way things work.

The problem is that the frothing at the mouth of the market has put all of the emphasis on the connection, with the primary question being “what ‘thing’ can I instrument next?”

The real question, however, should be, “What data can help me transform my customer’s experience, the way my employees work, or my foundational business and operating models?”

In many cases, the answer to that question will lead to capturing data from a device. But what’s important is that the context must be on the data and the transformation — not on the connecting of a thing to the Internet.

Extending the Boundaries of Technology

Collecting new data and using it to reimagine the customer experience and thus entire business models is an essential first step.

But what if you do even more with the intelligent devices collecting all of this data?

This is the other half of the IoT story — and the half that most people forget. As organizations deploy smart devices at the various points of interaction with customers, employees, and partners, new transformational opportunities will emerge.

Once you change the perspective from one of connecting devices to one in which you are building transformative capabilities, this vast array of IoT devices becomes a new canvas on top of which an organization can paint an entirely new picture of how it operates.

This will, of course, include some of the oft-shared use cases such as preemptively repairing machines, routing support personnel between activities based on IoT data, and automatically adjusting production schedules.

While those are perfectly good use cases, they mostly amount to nothing more than automating tweaks to current business processes. There’s nothing wrong with that, of course, but those use cases do not represent IoT’s real transformative power.

Instead, it will be when enterprise leaders begin leveraging these intelligent devices and the data they generate to transform foundational business models and operating processes — doing more than just capturing that data, but using it in context, and acting upon it.

Looked at through that prism, you can begin to imagine much more transformative uses cases for IoT. This fresh perspective becomes particularly compelling when organizations (or even consortia) combine multiple IoT form factors.

As just one example, healthcare organizations may be able to transform the administration of prescription medicine by combining microscopic sensors in pills to monitor dosage and usage, with a combination of location and other sensors to track patient routines that may affect if and when patients take their medicine. They may then use that data in conjunction with remote diagnostic data to automatically tune and adjust prescription timetables and even dosage over time.

The Intellyx Take

One of the reasons I am so optimistic about IoT’s transformative potential is because of the nearly endless ways in which organizations may eventually be able to apply this class of technology to change long-standing operating models and business processes.

It has the potential to transform everything from how consumers purchase items, to driving exponential efficiency deep within enterprise business processes — and everything in between.

The most significant barrier to unleashing this transformative power, however, will not be technological — the most significant barrier will be the inability for the enterprise to reimagine the way things work.

While the current-state roll-your-own nature of the technology presents a long list of technical challenges to any enterprise ready to go down the IoT road, the greatest challenges organizations will face will be to overcome their own cultural inertia.

Ironically, the most insidious risk to IoT may be its own short-term success. Slapping RFID tags on everything you produce, improving employee efficiency, and preemptively repairing equipment, will likely deliver a substantial return on investment – not to mention bragging rights at the next executive retreat.

But if that is all an organization does with its IoT efforts, if it fails to see IoT’s potential to transform nearly every facet of how the enterprise works, it will have missed one of the greatest opportunities of our modern era.

Copyright © Intellyx LLC. Intellyx publishes the Agile Digital Transformation Roadmap poster, advises companies on their digital transformation initiatives, and helps vendors communicate their agility stories. As of the time of writing, none of the organizations mentioned in this article are Intellyx customers. Image credit: Bureau of Land Management Alaska.

More Stories By Charles Araujo

Charles Araujo is an industry analyst, internationally recognized authority on the Digital Enterprise and author of The Quantum Age of IT: Why Everything You Know About IT is About to Change. As Principal Analyst with Intellyx, he writes, speaks and advises organizations on how to navigate through this time of disruption. He is also the founder of The Institute for Digital Transformation and a sought after keynote speaker. He is a regular contributor to CIO.com and has been quoted or published in Time, InformationWeek, CIO Insight, NetworkWorld Computerworld, USA Today, and Forbes.