Knowledge Byte: How IoT Can Redefine Industry Boundaries And Create New Business Opportunities
Smart, connected products redefine industry boundaries
Expanding capacities of smart, connected products not only enhance or change the nature of competition within industries but also expand the industry boundaries. This occurs as the scope of competition transits from specific products, to product systems consisting of closely related products, to systems of systems that connect an array of product systems together.
A tractor company, for example, may find itself competing in a broader farm automation industry. The figure exemplifies the concept. The following section explains the figure:
- Product: A tractor as an individual product is generally used on a farm.
- Smart product: When the same tractor has sensors attached/built into it, it becomes a ‘smart product’, thereby increasing the capability to communicate through sensors.
- Smart, connected product: When the sensors communicate information about the tractor, such as its location, maintenance cycle, etc. to a mobile, the system transforms into a smart, connected product.
- Product system: Further the tractor becomes an individual component in a ‘farm equipment system’. Here the single product ‘tractor’ has become a part of the product system.
- System of systems: Finally, the value becomes multi-fold when the product system becomes a part of the system of systems.
New Business Applications Opportunities of IoT
EMC Corporation, American multinational and International Data Corporation (IDC), American market research firm, see the IoT creating new opportunities for business in five main ways:
- New business models: IoT will assist various companies to create new value streams for customers, introduce processes that speed time to market, compare market performance, and respond rapidly to customer needs and requirements.
- Real-time information on mission-critical systems: With IoT, organizations can quickly capture more data about their operations and products required to create new income-generating avenues, improve operational efficiency, and enhance customer loyalty. IoT will help companies create additional services and new revenue streams besides traditional products.
- Diversification of revenue streams: Companies will be able to diversify the revenue streams, for example, vending machine vendors will be able to offer Inventory management to those who supply the goods in the machine.
- Global visibility: IoT allows organizations to have a global business perspective, including tracking the effectiveness and efficacy of the supply chain from end-to-end.
- Efficient, intelligent operations: Access to information from independent end nodes, similar to today’s smart grid that already supplies to utility companies, will enable organizations to make precise decisions on pricing, logistics, sales, support deployment, etc.
Source of the first infographic.
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The industry-recognized CCC Internet of Things Foundation ensures you are ready to add value to organizations of diverse industries and dimensions. It does so through highly interactive and thought-provoking discussions which focus on: Group exploration and debates Lab exercises which allow learners to experience IoT applications Case study scenarios for IoT End of Module questions
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