In April 2020 Matt Hatton and William Webb published a book entitled ‘The Internet of Things Myth’, exploring why the last decade has not been as successful for IoT as might have been hoped or expected. Previous articles on IoT Business News examined the challenges represented by mismatched expectations for developers, lack of preparedness by adopters and technology fragmentation.
In this article we turn our attention to the vendor community, which has often struggled to deliver value to enterprises deploying IoT.
Rather than focus on the shortcomings of vendors in addressing the market we turn instead to our recommendations for how they can help to nurture a progressive ecosystem, as well as make a buck or two for themselves.
Make sure you’re not just following the herd. You can’t just plunge into IoT and expect to make money just because it’s a growth area. An undifferentiated ‘me too’ approach drives out value and ultimately doesn’t benefit the arriviste organisation: for instance, it’s hard to structure your organisation to sell new products, and margins are compromised. There is nothing wrong with building a set of capabilities to be useful in IoT. But it does have to be useful. SAP, for instance, has done a good job of pivoting a set of capabilities aimed at ERP towards IoT, a natural development.
Focus on your own piece of the value chain. It’s hard to be good at someone else’s job. As a complement to the previous point, most companies find it hard enough to be good at properly addressing the needs of their own market, let alone someone else’s. If you want to move into another part of the value chain you had better be at least 50% better than the incumbents. That generally means the application of scale, extension of capabilities through acquisition, or significant investment in building new capabilities.
Value, not valuation. Stop worrying about being a unicorn and look at where the gaps are. Some IoT companies will be valued at billions of dollars. Probably yours isn’t one of them. Stop worrying about finding the infinitely scalable universally adopted platform play. Start looking at where there are gaps to be filled and problems to be solved. A lot of the value that can be delivered in IoT in the next 10 years is in companies with know-how helping organisations with the practicalities of their deployments.
Steer your clients. The biggest potential pitfalls in deploying IoT in the enterprise are with the clients that are deploying rather than with the vendors that are developing. There are numerous challenges associated with implementing truly transformational IoT. Vendors need to steer their clients in the direction of making good decisions (as outlined below), for instance by ensuring that there is some commercial grounding for a PoC. It’s not good enough just to have a great product, you also need to provide leadership for your clients.
Show that you’re in it for the long haul. Most IoT investments, both consumer and enterprise involve some kind of long-term commitment to a particular product set whether it be an application development platform or a garage door. Everyone wants to be sure that their chosen provider/partner will continue to support the technology or product for the foreseeable future. Setting a precedent by abandoning products does not help with long-term certainty.
Secure by design. The single biggest concern for most people or organisations adopting IoT is security. This is worthy of a book in its own right. Put your product through penetration testing and honeypot trials. Following the introduction of the IoT Security Law which came into force in California at the beginning of 2020, it’s likely that lots of other countries will follow suit to introduce requirements for IoT devices to have “a reasonable security feature or features” anyway. Follow best practice such as the UK’s Code of Practice for Consumer IoT Security .
By following these simple rules, we think vendors will be much better placed to create an IoT ecosystem that works for everyone.