As organizations flock to the Internet of Things, brainstorming how they can use IoT to create new revenue streams or to improve operations, leadership for IoT becomes a major CEO concern. Should IT, an end-business unit, or an entirely new function be called upon to produce IoT innovations and results?
There is no one best practice answer to this question.
Some people argue that an IT manager should be leading IoT, because many IoT issues are IT-related. IT is also a project-oriented discipline that can easily take projects from requirements definition to implementation. Others say it should be an end-business unit that already understands the responsibilities and accountabilities of developing a product for profit or for cost savings and workflow improvements. Still others concede that many organizations really don’t have any one internal person or area that is qualified to run IoT–and that the function needs to be built up from the ground, with someone from the outside being brought in to run it.
“The majority of companies that we work with begin with a very hazy concept of IoT,” said Zach Supalla, CEO of Particle, which provides a prototype-to-production platform for IoT products.
A good example is a company that manufactures agricultural equipment. A logical IoT next step is to enhance product value by equipping the equipment sold to customers with IoT sensors that connect each piece of equipment to a central monitoring system run by the company. Such a system would monitor the vital signs of equipment in the field and either recommend servicing or dispatch service agents to customers when equipment alerts are received. The end result would be a new revenue stream built on service.
“Today, these ideas often start at the C-level and are handed off to an individual engineer or to an engineering R&D function within the company,” Supalla said. “The R&D group, which is the only group in the company where IoT work seems to fit, is charged with building a prototype of the proposed system. It builds the prototype and presents it to executive management, but this is where its role often ends.”
The role for product engineering ends because the group that designed the product doesn’t have the skill set to commercialize what it has created. At this juncture, a company could pass off the IoT work (and responsibility) to a product group. In other situations, there might not be any obvious group to pass the baton to–so the process fractures.
Supalla said that problem isn’t uncommon.
“Many companies are wrestling with this now. They can hand an IoT product prototype to a product group, but then there is no IoT experience within the product group to take the product further. In other cases, there is no obvious owner of IoT, and the company discovers that it does not have the internal skills or expertise.”
The bottom line is that CEOs and other C-level executives need to be thinking about who owns IoT in their organizations now.
How do you get started?
1: Evaluate your current resources
Begin by looking at your organization as it stands today. Are there business units or departments within your company where there is a natural fit between IoT innovation and the skill sets and enthusiasm of certain groups of individuals?
2: Consider your innovation track record
If you already run an innovation-driven technology company, determine whether you really need to think any differently about IoT than you thought about any other new product breakthrough. It could be that you already have the mechanisms in place to keep on rolling with IoT.
3: Conduct some planning sessions
If you’re like most companies and don’t have skilled IoT people or a department or business unit set to take on IoT work, spend time internally with your management team and staff to determine how such a function would be defined, where it should report to, what types of people should staff it, and who should lead it.
4: Look at your internal staff
Before going outside the organization, assess whether you have some of the talents and aptitudes needed for IoT in your own employee workforce. “It often comes down to the personality of the individual and whether he or she is willing to try something new,” Supalla said.
5: Don’t expect instant ROI
Be patient with your return on investment (ROI) expectations. IoT doesn’t necessarily pay off right away, but it will in the long haul if you direct it to the right business cases.