How the IoT will impact today’s product strategies
Products are getting smarter and more connected every day. Software and sensors are being embedded in everything from thermostats to cars, driving unprecedented innovation. Tesla has already added a “self-driving feature” that can be implemented via a software update; it’s now possible to send texts by simply pushing up the sleeves on one’s hoodie sweatshirt; and washing machines are connected to the manufacturer’s help desk.
All of this automation is great for the consumer, but is causing quite a stir at most product development companies. How can today’s companies bring together product development with IT infrastructure projects to ensure they are able to attain the coveted first-mover advantage?
Smart products benefit everyone
Wikipedia defines The Internet of Things (IoT) as the network of physical objects or “things” with embedded electronics, software, sensors, and connectivity to enable it to achieve greater value and service by exchanging data with the manufacturer, operator and/or other connected devices. In practice, this means companies large and small are becoming product and software companies– not just one or the other, says Carrie Nauyalis, solution evangelist, Planview.
Innovation across many industries- including automotive, industrial equipment, household appliances and electronics- is coming from software rather than hardware. While the function and basic mechanics of connected lightbulbs remains unchanged, what’s new is that they can now be controlled from hundreds of miles away, using a mobile phone app, and the data associated with the use of that lightbulb is stored, analysed, and leveraged for improved insights.
Everyone along the supply chain, from manufacturer to consumer, benefits from connected products. The IoT provides companies with the ability to tailor their products and capitalise on the data captured. While there may be one physical product that leaves a company’s plant, it has the capacity to become one of multiple products in the field, depending on the capabilities that are enabled within it or installed by the consumer aftermarket. For example, think about how our cell phones can now be transformed into an alcoholic breathalyser or bad breath indicators.
The IoT also enables companies to monitor and diagnose product performance remotely. Using the information sourced from connected devices, companies can pinpoint defects, understand trends, and get ahead of or respond faster to issues that arise, ultimately improving customer loyalty. Instead of having to recall a product, in some cases the connected devices enable companies to fix products in the field by pushing a software fix down to their products. This means significant cost savings for manufacturers.
How is the IoT impacting product strategy?
Connected products can come in many forms. Sometimes it’s a technology component inside of a traditional engineering product. But connected is more than smart. It means big data.
Many experts will tell you that the richness (and risk) of IoT come in the data that is collected via IoT products. Product development leaders rarely have the expertise required to design, build, and secure the infrastructure required to store and mine this information. This is where partnership with IT is crucial. IT is now key player in the product planning process and iss no longer just a supporting function. It also means that IT projects are on the critical path in generating revenue for the company.
This trend is highly prevalent in the automotive, life sciences, and CPG industries. And it is on the rise in financial services, healthcare, and retail industries.
As a result, companies are starting to see portfolios collide, with increasing overlaps between their product and IT portfolios. While these areas used to be relatively separate, companies now require a new way to combine these portfolios in order to drive business growth.
As this overlap between product development and IT becomes more pronounced, operating in departmental silos with independent project portfolios simply will not work.
Overcoming product development complexity
Many organisations are struggling with the transition to develop connected products and, as a result, are being left in the dust by their more agile competitors. They find the challenge of achieving a seamless IT and product development process to be quite daunting, as they have to manage not just the product itself, but also its intersection with embedded software, communications, analytics, security and corporate systems.
Other companies however, have turned to technology to help them with managing the ever-increasing complexity of their product portfolios. Today’s tools enable organisations to plan strategies and roadmaps, do resource planning, and manage projects for both the technology and product development side of the equation, in an integrated way.
Once organisations are able to take stock of factors such as cost, risk, and business value for each product they wish to develop, they can determine where to continue investment and where to reduce and consolidate. In other words, once they have the full picture, they can make informed decisions about what to retire, modernise, and consolidate.
Making products smarter is about making better products. Once organisations account not just for the changes that are going to be happening within their products, but also for those that are going to be happening within the enterprise, they can focus on bringing products to market successfully.
The author of this blog is Carrie Nauyalis, solution evangelist, Planview.
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