The Internet of Things (IoT) movement is upon us. Devices are
increasingly becoming connected to the Internet, and analysts are making
big predictions. By 2020, Gartner says 21 billion devices will be connected to the Internet, and IDC says IoT spending will reach $1.7 trillion.
This is both an exciting and terrifying time – the opportunity to
monetise the value of data has never been greater and the threat of new
market entrants has never been higher. IoT is on the mind of board
members of companies across all industry sectors. In fact, a recent
Economist survey suggests that 95% of companies expect to use IoT within
three years, says Mark Benson, chief technology officer at Exosite.
Yet in order for these predictions to come to fruition, manufacturers
of durable goods must transcend significant organisational hurdles to
bring connected products to market.
Five key steps to successful IoT adoption
For many manufacturers, bringing an IoT solution to market requires
business models, tools, and skill sets outside their core competency. In
order to be successful, manufacturers must develop a:
- Cohesive IoT strategy. A cohesive IoT strategy
provides an understanding of both the short- and long-term competitive
implications, and seeks to reuse IoT solution components across products
and divisions to maximise effort and investment, minimise duplicated
work, and increase interoperability.
- Clear view of customer needs. Traditional
manufacturers that utilise a multi-step distribution channel often lack
direct access to end users and may not fully understand their challenges
and needs. For instance, an engine manufacturer might sell directly to
equipment OEMs, which then sell through distribution channels to a
dealer network that ultimately sells to an end user. If a manufacturer
understands how a connected engine impacts the value chain and improves
the end-user experience, that knowledge can be used to capture value.
- Viable business model. Business models are changing
from product to service, from CAPEX to OPEX, and to alternative
approaches like subsidy models, ad-supported user experiences, and
bundled product and service offerings. Developing a business model
strategy is key to building an IoT solution, but often stretches a
manufacturer’s existing knowledge, tools, and processes.
- Reliable technology architecture. It is critical
that a technology solution is scalable, robust, secure, and flexible.
Just as critical is the technology strategy — whether a manufacturer
builds, buys, or partners on specific portions of an IoT solution to
maximise market differentiation and meet time-to-market objectives. For
many manufacturers, key areas of differentiation include the device, the
user interface, algorithms, and analytics, although this depends on
- Agile organisational alignment. Manufacturers need a
plan for business transformation to ensure that operational areas
(sales, marketing, engineering, manufacturing, test, legal, IT, support,
and finance) are aligned around the strategy. For some companies, this
type of cross-functional team collaboration is new and difficult.
Organisations that do it well can move quickly and surpass their
Business transformation for durable goods manufacturers
Founded in 2009, Exosite is a multi-national enterprise software
company that helps organisations address these five steps through a
robust set of products and services. Exosite’s offerings are tailor-made
to help manufacturers transform their business and get secure connected
products to market quickly and in a highly differentiated way. These
—Exosite IoT platform.
Exosite has a scalable,
flexible, open, enterprise-ready software platform that enables
manufacturers to design, develop, deploy, and support connected product
fleets. An array of open and transparent embedded software libraries,
communications protocols, and application libraries reduce development
barriers and decrease time to market.
—Exosite business transformation services. Exosite
provides an array of Business Transformation Services and professional
product development services to help customers define their IoT
strategy, understand customer needs, refine business models, design
their technology architecture, and create organisational alignment to
For many manufacturers, developing a successful IoT product can be
difficult without a clear business goal. Having worked with hundreds of
customers in dozens of markets, Exosite has a deep understanding of
common challenges and has proven experience in enabling manufacturers to
IoT is here – and it is not going away. Manufacturers of connected
products have the potential for tremendous gain if they focus on the why
of IoT instead of merely the how.