However, that doesn't mean that organizations have shelved the idea of using the IoT to reduce internal costs as well. In fact, IDC says productivity of both assets and employees, as well as "optimized operations," were close behind revenue growth as the top priorities for CIOs considering the IoT.
Of course, each organization will have its own priorities for investing in a new technology, and those priorities may not always be clear to those outside the boardroom. So it can only help to be prepared to cover all the bases when looking for IoT opportunities. As the Harvard Business Review article suggested, looking at the broader impact of the IoT can help identify new areas it can impact, leading to those that align with the organization's priorities.
"Improving asset productivity benefits the bottom line, but the untapped opportunities for economic impact are in finding creative ways to deploy the technology to drive top-line revenue growth and expense reduction," the article reads. "So far, these have received limited attention."
The IDC report mentioned a tractor company that introduced IoT products to help their customers monitor the tractors' performance while in use in the field. However, these capabilities opened up a new revenue stream for these farmers a "product-as-a-service business model." The IoT tools in the tractors not only helped their customers improve the efficiency of their own assets, they also enabled them to rent the tractors out on a per-use pricing structure, monitoring the renter's activity with the tractor to determine the rental cost.
Balance the potential with the risk
While IDC's study found that cost is "surprisingly" not the top challenge that CIOs cite in regards to deploying the IoT, cost-related factors still ranked near the top of the list. The two most common responses behind infrastructure constraints/scalability were the high cost of investment and a "lack of skills for cost-effective operation." That last challenge basically means they don't want to pay a bunch of new IoT experts in order to launch the technology.
This could be important, as a new IoT initiative with a very optimistic plan could get derailed when the organization discovers that it lacks the infrastructure or expertise to finish the project.
In addition to the obvious security implications of connecting new devices to the internet, risk needs to be evaluated just as much as, if not more than, potential.
To effectively capitalize on the IoT's potential while hedging against the risks, Gartner advises that companies take an "enterprise architecture strategy." This requires enterprise architects to "properly assess the impact in terms of what information will be generated, what the most important information is and how it can be protected, if necessary."
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