Living up to the promise of IoT: How the right IoT strategy can transform a business

In my early days of being the CDO of Cisco, I routinely fielded questions from interested C-level executives and boards about which public cloud to use.  We would discuss the concerns of being tied to any single cloud, as the needs of business are ever unfolding. I would tell them our goal from Chuck (CEO of Cisco) was to be as fluid to sustained change as possible. One cloud is not the answer. Choice, at the right time and need, is the answer. Choice opens the most opportunities for sustainable growth. 

When I first got to Cisco, I remember a 1:1 review with John Chambers where we discussed the Internet of Things vs. the Internet of Everything. That conversation clearly left a mark on me because John was suggesting automation isn’t the finish line of IoT. The best companies are iterative and ever learning. Interestingly, so is technology innovation, and that has only intensified with cloud and more intelligent edge connected devices.

Today, people question whether IoT has achieved its potential. Yes, there are billions of devices connected to the network every day, and an estimated 127 new IoT devices are connected every second.  Not all of those are enterprise endpoints, but in both our personal and professional lives, the value of immediacy is expected more and more. 

When I look at IoT, do I think it has achieved its potential? No, I don’t. To the cloud discussion, many customers have realized one IoT platform isn’t the answer. It takes the strengths of multiple IoT platforms to meet their needs. I see two areas where companies are commonly and repeatedly failing to tap the potential of IoT. First, functional ownership masks enormous wasted investment. Second, by far, the majority of companies do not think of IoT as a business process automation effort vs. purely automation.

This reminds me of when was breaking open the market. Traditional IT people debated SaaS’s merits as cheaper automation software. What they had to learn is that introduced SaaS as an iterative process software, which makes investments and businesses far more sustainable.

Achieving the IoT promise requires a paradigm shift

Companies have made enormous operational improvements with IoT networking efforts. Still, the technical advancements that define the untapped potential of IoT are already heavily deployed, yet not utilized. I see it every day, very few companies realize that IoT is now a business process automation strategy, and not just a strategy for automating things. Companies have made wise investments in the technologies and relationships they need with service providers to run their businesses, yet the ROI is muted by legacy, functional disciplines.

At Cisco, I would have to explain to those visiting boards and business leaders that every company is becoming a technology company. This is truer than ever as we all redefine the boundaries of ‘work’.   Almost any business leader can identify extreme amounts of waste happening within their business that are greatly impeding the investments they have made in IoT, or just in becoming a sustainable business. 

What do I mean by legacy functional disciplines impeding results? Nearly all companies lack an IoT owner, which leads to budget redundancies on top of redundancies (read: wasted business investments). Consider this typical scenario that is repeated across almost every company, of every size, of every geography:

  • Procurement is buying connectivity from the operators under the perception it is data for IoT 
  • IT is buying equipment from network and device companies for IoT execution 
  • Where engineering is involved, individual product owners select their own IoT components 
  • Companies routinely manage their operator IoT platforms 1:1

In addition to the compounded wasted investments listed above, companies very seldom know what the functions are doing in relation to other efforts. This creates institutionalized waste within the company.  

Companies that look at IoT as basic automation instead of as a business process automation strategy are not only failing to realize the potential of the technologies they have deployed, but also are measuring performance by function. Even worse, this is too often done in the arrears. The real promise of IoT is moving from an automation mindset to a cross-functional business process automation effort, evolving the business in real-time to make it more efficient and sustainable.

Look for part two of this blog series, where Kevin Bandy will share his thoughts on how IoT insights can help companies drive out 50% of operational waste.

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