A recent released results from a survey of 200 IT and business leaders released by TEKsystems finds close to one in four organizations (22%) saying that IoT is already delivering “a substantial impact” on their businesses.
The majority of organizations (55%) expect IoT initiatives to have a high level of impact on their business over the next five years and benefits anticipated include creating a better user and customer experience (expected by 64%), sparking innovation (56%), creating new and more efficient working practices and business processes (52%), and creating new revenue streams in terms of products and services (50%).
IT departments are spearheading this move and while business/ strategy, operations and R&D are also involved, what is surprising is the finding that only 9% indicate a close coordination between business and IT for their IoT projects.
Historically, few CIOs have gone on to become CEOs, meaning CEOs may lack the strategic knowledge of how IoT can help business transformation. Equally, since most CIOs aren’t groomed to be future CEOs, CIOs may lack experience to think strategically about how IoT impacts the entire business beyond IT.
With digital transformation becoming an important part of any business, it is important that there is an alignment between the CIO and CEO function, between technology and strategy. However as Forrester Research Sharyn Leaver discovers in a survey of 947 business and IT executives, only 27% of companies had a clear digital strategy, even as CIOs increase investments in cloud, mobile and analytics tools.
One of the key areas that Leaver identifies as crucial for the CIO to achieve in order to aid the CEO’s business strategy is in building an agile IT system. Sometimes it requires rebuilding their existing architecture; for example moving from a rigid on-premises environment to a more automated cloud system, so as to better address the agility required of the digital business.
“Companies should get comfortable producing a ‘minimum viable product’ and then continuously improve upon it. It can’t be a three- to five-year strategy anymore, because it has to be fluid,” Leaver says.
Established firms in any sector will have to overcome legacy investments in infrastructure and embrace new models of collecting, sharing, and making sense of data both collected and shared by Internet-enabled devices to recognize the IoT benefits of greater effectiveness and efficiency. Completely new business models will also emerge and challenge the status quo. Both CIOs and CEOs will need to focus on building a business that is more nimble, resilient and responsive than ever before.
The ideal scenario is illustrated by Dr. David A. Bray, CIO for the Federal Communications Commission, “With the right pairing of a strategic, future-focused CEO and CIO, the role of CIOs will evolve towards more of Chief Strategy Officer. The Chief Strategy Officer will seek new, transformative ideas and solutions to ensure the organization delivers great results, continues being relevant, and is resilient to the changes ahead.”
With IoT, the business potential from bridging the CIO and CEO functions becomes exponentially greater.
This article was written by Yue Yeng Fong for more of her articles visit her on Linkedin[:]
[:en]We spent a large part of the year in the cities of Manila, Bangkok, Jakarta & Kuala Lumpur speaking to local enterprises about this (too) broad & (too) overused term: the Internet of Things (IoT). We discovered very quickly that while IoT seems to be very much over/wrongly-used in the English speaking world, there really isn’t a direct local translation in these 4 countries. For local enterprises in these countries, they see IoT as an extension of Enterprise IT, without having a definition/term for it.
In our mid year review (Bringing IoT to a Population of 600 million), we summarized how IoT applications can be applied to these 4 countries, with some projects already being put in motion, while others remain quite far from realization. As we near the end of 2015 (with every Starbucks in the region starting to play Christmas carols and serve Peppermint mocha lattes, ha!), lets look back at the industries in the region where the conversations involving IoT projects are more pertinent.
This industrial segment was not something we focused on in 2015 but as we worked with local telcos & government agencies to invite enterprises to attend our events, we found the interest from the local manufacturing firms to be overwhelming. We should have known. In this part of the world, countries such as Thailand, Vietnam & Indonesia are increasingly important global players in the space. While granted, these countries are chosen because of low labour costs, locally run vendors & OEMs are very proactive when it comes to technology implementation within their factories (technology implementation is a lot more attractive when you’re experiencing double digit growths vs no/low growth environments). Plus, legacy IT systems/culture are a smaller problem in young, growing firms.
Among others, we had the opportunity to speak to several representatives from one of the world’s largest cigarette manufacturer. The local entity is owned by an international parent but because they produce a slightly different product (close to 90% of locals in Indonesia smoke kretek), they couldn’t implement manufacturing processes wholesale from their parent company. Another cliche with much truism:- Think Global, Act Local.
Manufacturing & Industrial Automation will be a big theme in 2016, especially in Thailand and Indonesia. Macroeconomic conditions (weaker local currencies, young workforces etc.) have also made these locales more attractive to international companies looking to set up manufacturing facilities – and technology, when used properly, can overcome (some) productivity inefficiencies usually associated with emerging countries.
In the more developed countries, the ageing demographics make Healthcare a natural topic of discussion. Remote monitoring/diagnostics is important not only in elderly care, but for archipelagos like Indonesia & Philippines. We found that in this part of the world, implementation of such systems are being driven largely by the government agencies and young startups.
Some notable implementation in the region: In Singapore, applications like Healthcare ATMs have been rolled out and in Philippines, local startup Medifi implemented a pilot earlier this year, with plans of expansion to other Southeast Asian markets soon.There’s always a buzz during the Healthcare segments of Asia IoT Business Platform, simply because it’s something which all of us relate to.
Distribution, Transportation, Logistics & Freight
I am reminded of a conversation I had with the owner of a logistics company in Manila who was a native English speaker but wasn’t familiar with the term “IoT”. But talk about telemetry, control software, sensors which track everything from his vehicle locations to petrol levels – and he’s in his element. His company was growing very quickly and he was in the process of modernizing its systems to:
1. Create efficiencies
2. Gain better control/insights
3. Account for future growth
(If #1 and #2 do not make up the classic definition of IoT, I don’t know what is!)
In countries like Indonesia & Philippines, the Distribution, Transportation, Logistics & Freight segment have employed M2M technology for years. On the other hand, because of the low cost of labour, many companies still use manual methods to achieve the same goals:- instead of sensors, some Indonesian freight companies send “spies” to follow the drivers of their trucks to ensure that they do not siphon off petrol in their vehicles to be resold!
Which types of companies do well in the Enterprise IoT space in Southeast Asia?
It’s a given that IoT will change business landscapes globally over the next 5 years, but it’s interesting to note that because of the uniquely local problems that enterprises face in this part of the world, the companies that are best positioned to take advantage are those with a big local presence.
Telcos: With the need to connect millions of devices, IoT provides a new revenue stream for the local telecommunications companies. This is reflected in the setting up of IoT/M2M teams in most local telcos in the four countries. These firms now run their own revenue targets (aggressive ones!) and we can only see this portion of their business growing over the next few years.
Large Multinational Vendors: This goes without saying. These companies have been deeply entrenched in the local infrastructure – the Microsofts, Intels & Schneiders of the world. They have established relationships with local enterprises and the advent of IoT technology will make them natural partners to enterprises looking to upgrade their systems to fully realise the benefits of IoT.
Local Startups: We have had the pleasure of working with many new companies who understand local problems intimately and are flexible enough to work around the lack of standardization within IoT. They are providing innovative & cost effective solutions to small medium enterprises in these countries. There were a lot of enterprises interested in presentations given by companies like N’osairis, Versafleet & Medifi in 2015 – and the best part is, we are seeing projects being implemented.
International Vendors with a presence in Southeast Asia: Over the years, we’ve seen this group of companies increasing as they realise the potential of the market here. In 2015, we’ve had more interest from international firms than we’ve ever had. But we’ve noticed that those who have invested heavily in the region (companies like Thingworx, Axiros, Sigfox etc.) by being present locally and building a dedicated team have reaped the largest rewards. There will be an inflexion point in this market and it remains to be seen if the first movers stand to benefit more than latecomers. I believe they will.
There are other developments within the B2B2C space (of course – Southeast Asia has over 600 million consumers!) but that warrants a discussion of its own.
If you’re interested in IoT/M2M developments in Southeast Asia, do drop us a note with your thoughts. We are currently in the planning stages of our 2016 events to be held in Philippines (23 – 24 May 2016), Thailand (26 – 27 May 2016), Indonesia (15 – 16 Aug 2016) & Malaysia (18 – 19 Aug 2016). See you in the region if you do decide to drop by. [:]