IT-Enabled Products and Services and IoT
“The Internet of Things (IoT) is a technology revolution in the future of computing and communication that is based on the concept of anytime, anyplace connectivity for anything.”(1) There are predictions that by 2020 a possible 50 billion devices will be connected and on some campuses an expectation that each student will have up to 10 IP addresses. Everything from clothing (including wearables) to vehicles to machine parts to infrastructure is going online. Companies find they have deployed industrial devices “calling home” that they didn’t know about, and “home” isn’t necessarily them (the company that owns the device!) Opportunities abound to gain greater knowledge on human health and machine performance, and to do care and maintenance differently. All this is occurring as the cost of harnessing powerful computing has dropped to around $400 for a smartphone from about $5 million for a super computer of comparable power in 1975. The arrival of inexpensive cloud-based computing and robust mobile technology combine with the immediate sensing and reporting of social media and tools for marshaling big data to form a potent combination.
Meanwhile, developing and bringing new products or services to market has become ever more complex, not least because information technology is increasingly embedded in customer products and serving as an enabler of services offered around products (e.g. including monitoring/maintenance services with the sale of major equipment such as GE’s jet engine or rail business or ZipCar’s model where the app, the vehicle, tracking and billing are a fully integrated system). Product designers, marketers, and manufacturers are likely spread over several continents in organizations with different cultures, languages, and even business objectives. In this roundtable, we will discuss the implications of these changes, focusing especially on the embedding of IT at the core of products and services, the interplay of this with IoT and what this means for product development and IT. At this roundtable, we sought to understand this phenomenon and answered questions such as:
- At what pace is this all going to move? Where will the real impact be? Where will it be felt first? What does the landscape look like? How do we separate the real from the illusion?
- Where is IoT real right now? What are examples from each company of opportunities they are already exploiting, ones they are considering, or ones they clearly see coming?
- What should our approach / business strategy be with regards to IoT? How deeply do we invest in it? Should our focus be customer value-facing, internal/operating efficiency-creating, initially more analysis-oriented, or what?
- What is the impact on our social strategy and our Big Data approach? Whether B2B or B2C what are the implications for how we know, serve and converse with our customers? Increased context? For individualized marketing? For crowdsourcing?
- What are the management systems we have to change to be prepared? Who will “own” IoT in our enterprise/industry and why? IT? Marketing? Operations? How do we clarify enough to make coordinated decisions without stifling innovation?
- What effect is the ubiquity of info technologies having on product and service development at a strategic level? What types of products/services might be created or destroyed by IoT?
- How to do you leverage learning between product/service development groups and corporate IT? Are companies splitting technology and tech organizations between corporate IT and product technology? What is the role of external partners in new product/service generation?
- What are the security, safety and privacy challenges? For corporations? For employees? For consumers? Will “knowing” where things are improve efficiency and security?
- What new technologies/processes/people should we invest in now to prevent difficulties later? Do we need to reinvision aspects of our organizations and vendor relationships?
(1) ITU Internet Reports 2005: The Internet of Things: Executive Summary
Participants from left to right include the CIO from the hosting company of ABB, Andy Tidd; Martin Hofmann, Group CIO, Volkswagen AG (center) and Per-Åke Tobiasson, Head of Global Process Office, Tetra Pak (right.)
Volker Laska, CIO of Clariant International Ltd (left) and Volkswagen AG's Peter Harris, Group Marketing Communications (center) listen to Jean-Louis Keraudren, Corporate Head of Direct Marketing - Big Data at Hilti AG.
Participants from left to right: Martin Petry, CIO, Hilti; Hans Brechbühl, CDS Executive Director and moderator; and Edward G. Happ, Global CIO, International Red Cross and Red Crescent Societies.
Khushnud Irani, the CIO of Holcim Group and Max Braun, CIO of D. Swarovski AG, listen in.
Claes Rytoft (left) is the Chief Technology Officer at ABB Technology Ltd. To his right sits Jan-Ake Ljungqvist, Global Director and Project Manger IT-OT Integration at Tetra Pak.
Martin Petry enjoys a chuckle during the discussion. Following the roundtable, Martin commented that this was one of the best roundtable discussions he'd attended.