IoT is a complicated space spanning the worlds of both product development and information technology (IT). IT spans many areas of technical expertise: embedded product design, app design, connectivity, cloud software, security, backend, dev/ops and many more.
Adding connectivity to products has many implications across an organization. Companies need to link physical products with software and services, and that means cross-functional cooperation across IT, engineering, manufacturing, marketing, business intelligence/data analysis, sales and customer support departments.
As manufacturers move beyond pilot projects towards deployments at scale, IoT takes on even greater meaning across an organization. As we’ve discussed in other blog posts, with IoT consumer products it’s no longer a case of the ‘one-and-done’ product sale. With products that can be updated in the field via updates to onboard software or connected services, ongoing consumer relationships spell the future of consumer brands. That is both the opportunity and challenge of IoT.
But before a company begins the process of building an IoT product, their executives need to prepare for the interdependencies between departments and the interdisciplinary talent that will be needed to succeed.
IDENTIFICATION OF COMPANY STAKEHOLDERS
It used to be that IoT products were the domain of engineering groups. Today, line of business leaders (LOBs) are leading IoT initiatives and either allocating their budget, or sharing the costs of development initiatives with the CIO’s IT budget. In a growing number of cases it’s the CIO who is tapped to lead the project, because they are the most technically competent person in the executive suite. And they know that becoming a provider of connected products means they are providing software, services, and development operations—essentially becoming a software company. This is a huge leap of competency for companies who have earned their success manufacturing hardware.
According to Gartner, by 2020 more than 10 percent of new IoT product projects from traditional industries will be headed by the CIO. But other research shows that an even larger number—almost one-third of organizations—already expect the CIO should take charge. Regardless of where an IoT project originates, it will need to have buy-in from key executive stakeholders including the CEO, CFO and CMO, and be surrounded by a strong next-level team.
INTERNAL SKILLS ASSESSMENT
Given the history of IoT development and deployments so far, lack of tech skills within brand manufacturers have become a new, top concern. As is often the case with consumer products companies, there will be gaps in internal skillsets that may be difficult to fill, especially because their core business has not been known for being high-tech and therefore they may have difficulty attracting top tech talent.
What new skills will your company need to acquire to effectively manage a transformation to connected products?
OUR PITCH FOR USING EXTERNAL VS. INTERNAL RESOURCES
Software developer jobs are in high demand. In fact they ranked as the second most in-demand job in manufacturing over the past year. The recent Wall Street Journal article, “Manufacturers Struggle to Woo Software Developers,” gets to the heart to the matter: manufacturers are finding it hard to compete with the pay, benefits, and career advancement pure tech companies offer to software developers. This is one of the reasons why many consumer products companies prefer to engage an outside partner to help them with their IoT platform versus building it from scratch.
Arrayent has built our business around being that partner, with a team of professionals that can design, implement, manage, operate and maintain IoT projects for consumer brands across the globe. We have helped consumer brands launch over 65 connected home products in 80 countries on five continents in the areas of home appliances, lighting systems, access control and HVAC/water control. We have the skilled talent with a track record of implementation and operations that our customers can trust, leaving them to be able to apply their precious tech talent to core product differentiation.
With many software ‘building blocks’ being more available than ever, companies find it tempting to either attempt to build an IoT solution themselves, or to be lured into a custom IoT development program from the professional services division of a major IT provider. After all, no one ever got fired for hiring THEM, right? But consider these alternatives. You could spend two to three million dollars and take 18 to 36 months to bring your first connected product to market. And then, at long last, you would be ready with yesterday’s technology to face a market that is changing at lightspeed. But at least you would ‘own’ your own processes and code. Or, your company could work with an agile IoT platform like Arrayent and learn in real time by bringing your first connected product to market from idea to on-the-shelf within six months, for less than the cost of two full-time software engineers. And you would benefit from the learning achieved from all those other projects from major consumer brands through the years. Contrasting these two scenarios, which defines the ‘safer’ business alternative?