When we emphasize “things” in the Internet of Things, we obscure its real value-the ability to make connected decisions based on analysis.
The world can be remarkably obtuse about some of the simplest aspects of technology. This obtuseness stands in the way of the wise adoption of the latest and greatest advances in software and hardware.
The term “Internet of Things” is a great example. It emphasizes “things,” often described as sensors, and hides the real value and the real challenge: Making connected decisions.
Consider GE’s billion dollar investment in the Internet of Things. This is a major bet that sensors reading data from products in verticals like aviation and healthcare will revolutionize decision-making.
The same goes for agribusiness, where the deployment of resources like water, fertilizer, and expensive machinery is increasingly being decided based on real-time data.
This could drive down agricultural costs, increase yields, and help respond to Mother Nature’s variation more accurately than we ever have before.
The challenge for business is to shift the focus away from things. Yes, you need to invest in new hardware and software in an IoT deployment, but without excellent analysis, a host of sensors won’t give a competitive edge.
“Anyone willing to spend can deploy sensors, but only those who analyze and improve upon decision-making can truly differentiate,” said John Morris, founder and head of Business Decision Models, which helps companies analyze, understand and execute better business decisions.
“IoT enables enhanced asset and process decisioning on the basis of detected business and technical events,” said Morris. “This is a sea change for business and will make our future look very different from our today.”
The big opportunity of IoT is to transform the business model. “The insights you can derive from Internet of Things represent a new class of business differentiation,” said Mark Palmer, senior vice president and general manager of integration and event processing at TIBCO Software.
Palmer noted that some of TIBCO’s customers have turned customer service from a support function into a customer engagement opportunity.
“Sure, they use IoT information, but the transformation of their business model was the bigger challenge,” he said.
The goal for organizations is to discover the connected decisions that can make that difference, then operationalize, and even more importantly, improve and evolve the automated IoT-driven decisions you make.
IoT is not a business model
A lot of enthusiasm for the potential of Internet of Things technologies is centered on “new business models.” And certainly IoT technologies can enable new ways of doing business.
However, the two are not synonymous. Business gurus such as Geoffrey Moore warn about the risks of transitioning to new business models if that means prematurely abandoning your current way of earning a return on investment.
Suffice to say that powerful new IoT technologies are just that — technologies. IoT is an enabler that can be built upon with the goal of realizing business vision.