Start plotting an IoT strategy in 3 steps

It's a transformative innovation, one that will have significant ramifications for business over the next few years.

Fri Jul 07 13:42:00 EDT 2017
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The Internet of Things is a world of objects — from cars to roadways, from refrigerators to industrial machinery — embedded with sensors transmitting information over the internet, allowing them to communicate with each other and with us. It's a transformative innovation, one that will have significant ramifications for business over the next few years. You can learn more about the IoT with Harnessing the Internet of Things, a Forbes Insights white paper sponsored by Pitney Bowes®. For now, though, I wanted to talk about three steps you can take to start plotting your organization's IoT strategy.

1. Consider the opportunity. The IoT creates opportunities for sustainable competitive advantage for you and your competitors. What opportunities do you think the IoT will present to your business? Understanding your opportunities will help you determine the rationale for IoT strategy and project implementation.

2. Seek ways to transform your business and disrupt industries. The power of the IoT is such that it will have a transformative effect on both individual businesses and entire industries. Determine how IoT data can help transform your business, and seek out ways to use it to disrupt your industry.

3. Think about location. Everything is somewhere. Location information is crucial to your IoT strategy. Consider whether you have the necessary location intelligence systems in place.

Let's delve a little more deeply into each point.

The opportunity

The IoT presents significant opportunities to improve business, most often by decreasing costs or increasing revenue. As an example, think of a manufacturer that, via information transmitted from a sensor, can determine the status of each of its machines and predict and schedule maintenance needs before an expensive breakdown and accompanying downtime.

Transform, disrupt

Even more significant, the IoT can transform businesses and disrupt industries. Imagine retailers being able to use sensors placed throughout the home to determine what commonly used household goods a consumer needs replaced, and to deliver them directly to the consumer's door without the consumer having to press a single button.

The IoT will not just transform, but disrupt. Like any technology that breaks down barriers to entry, it will enable new competitors to enter previously stable markets. These businesses will have an immediate competitive advantage because they won't have any legacy systems or processes to overcome. Imagine a new type of auto insurance company that uses the IoT for real time risk management. It can immediately analyze information on traffic conditions, weather conditions and crime rates, helping consumers buy micro policies based on very specific needs. This insurer could disrupt industry models by writing policies for acts as specific as driving into London or parking overnight in New York.

Location, location, location

Which brings me to the third point you should consider as part of your IoT strategy: location. Every object in the physical world is located somewhere, and you have to contextualizing objects connected to the IoT if your are to obtain maximum value from IoT data. Don't believe it? Just imagine having sensors and analytics alert you to a problem with a piece of equipment, but not where the equipment is. Not too helpful, is it? Make sure you have location intelligence software that can accommodate your IoT strategy.

Learn more

To learn more about how to develop an IoT strategy at your business, download this Forbes Insights white paper, sponsored by Pitney Bowes:

Harnessing the Internet of Things: How to derive big business benefits from the connected world