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Can IoT Meet its Great Expectations?

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We can all agree that IoT has become a hot topic with IT and business leaders. Why is there so much interest and excitement around IoT? Is IoT just another technology buzz term or will it have a lasting impact?

While there are many reasons for the high level of enthusiasm over the IoT, results of a recent study conducted by Hurwitz & Associates revealed several interesting insights. First, in this study, sponsored by Jabil, we discovered that companies are moving quickly with their IoT implementations and expect to see results from their IoT initiatives quickly. While just 52% of the 132 surveyed companies are in an IoT solution implementation phase, 89% of all of the companies expect their IoT initiatives to increase their competitive differentiation within 12-months. The remaining 48% of companies are either planning, conducting proof of concepts or testing their IoT solutions. This is a significant indicator that this market momentum will accelerate in the next two years.

Chart 1: Companies expecting to increase their competitive differentiation within 12-months

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What’s driving the optimism that the IoT can create opportunities and increase revenue? Businesses are expecting the data from connected devices to provide them with new insights that they’ve never been able to capture. For example, connected fitness trackers give companies the ability to understand how customers interact with their device. Traditionally, the manufacturer would have needed to gather anecdotal customer reports in order to understand what customers like about their products and why they may have stopped using them.  With the advent of IoT solutions, a manufacturer can now analyze the data from its connected devices and gain insights that will help improve future products.

It is clear from the study that companies believe that the IoT will change the way they understand and interact with customers. One of the questions that we asked survey participants was demonstrated the level of expectations that customers have around IoT.impact.. Customers were asked, “Do you feel that the IoT will change the following?” Participants were allowed to select as many of the issues that applied. (see chart below).  Adding together the top vote getters, it is clear that businesses expect to gain a better understanding customers so that they can proactively change the way products are developed, purchased and manufactured.

 

Chart 2: Will the IoT impact the following areas?

Will the IoT impact the following areas?

The above two charts tell us a lot. Companies are optimistic that the IoT will help their bottom line in the near future, and companies think the IoT will have profound effects across the business. In addition, companies are quickly trying to bring IoT solutions to market before competitors or new upstarts can out maneuver them.

Companies are recognizing that the Internet of Things gives them the ability to differentiate their offerings and create strong customer relationships. To quickly bring IoT solutions to the market, organizations are recognizing that they do not have the skills or knowledge to go it alone. They are partnering with a variety of vendors that can support their goals. Partners in the IoT space can help companies identify opportunities where embedding sensors can lead to opportunities. In addition, partners can help with product design and manufacturing. Click here to read the full Hurwitz & Associates report on the IoT. In the report you can review the full findings on the business value of IoT and its potential to transform companies across industries.
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