Implementing an Internet of Things (IoT) real-time analytics solution is one of the most complex projects with which a company will ever been involved. Here, RT Insights Executive Editor Les Yeamans explains the steps companies need to take to successfully realize the IoT’s potential.
Last week, the Wall Street Journal ran a provocative article by Christopher Mims entitled “Dumb ‘Smart’ Gadgets: The Bubble Is Set to Burst“ about how the bubble is about to burst on dumb “smart” IoT gadgets. In the article, Mims laid out the absurdity of some of the vendor hype about products such as Vessyl, the first smart drinking cup that claims it is changing the world. As if anybody cares how many calories they ingest with each beer they drink!
While I surely agree with Mims’ thesis for personal IoT devices, the hype on the industrial IoT is also rather concerning as documented in a recent Gartner report designating IoT as the most hyped emerging technology. Also, the claims made by many of the IoT real-time analytics vendors using words such as “revolutionize,” “transform” and “re-invent” gets me nervous. The emotional draw of these sizzling technologies combined with the fear of being left behind can drive Boards and CEOs to jump in with both feet—without a realistic return on investment (ROI) analysis and project plan.
Make no mistake about it: there is huge potential for IoT real-time analytics to dramatically impact nearly every industry. And, yes, it can help “revolutionize” your products, “transform” your customer relationships and, ultimately, help you “re-invent” your company in new markets. But, in order to realize this potential, let’s make sure we do what it takes to be successful.
Implementing IoT real-time analytics
First, let’s look before we leap to make sure we are attacking our most pressing problems. Is it the cost of fraudulent transactions in your financial institution or the lost business caused by downtime in your production operation?
Once we identify what to attack first, demand a hard-nosed ROI analysis including the benefits and the total costs of the IoT real-time analytics solution. Make sure to quantify the benefits wherever possible. If the predictive maintenance solution will reduce manufacturing downtime by identifying worn tool parts before they fail, estimate reasonable levels of improvement and work with accounting to identify projected dollar savings per year. Similarly, on the cost side, make sure to do a total cost of ownership (TCO) for the solution including all ongoing costs for personnel, maintenance and upkeep of sensors and other equipment.
Finally, let’s really understand the challenges of delivering a successful solution and develop a realistic project management and technical resource plan to pull it off. Implementing an IoT real-time analytics solution will be one of the most complex projects with which your company will ever been involved. The level of interdepartmental integration and communication between business executives, operational managers, the chief data officer (CDO) and the chief information officer (CIO) is unprecedented. However, as with any large complex project, breaking the project into manageable phases with realistic “baby step,” achievable goals is recommended. This will allow you to deliver the “low-hanging fruit” first and inspire confidence to continue the journey.
Overcoming hype of IoT real-time analytics
At the end of the day, I am confident that we can overcome the hype in the IoT real-time analytics solution market. There are many positive signs including many early cross-industry successes, high-quality products in the market, and first-rate industry associations such as the Industrial Internet Consortium (IIC) which is managed by my friend and Executive Director Dr. Richard Soley. With proper upfront planning and hard-nosed analysis, expectations can be managed and business results will undoubtedly be realized by more and more companies.