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| Is Your Internet of Things Innovation Failing The Value Creation Test? |
A recent study of Internet of Things projects around the world found the majority of them are stuck in proof of concept. In many cases, the problem could be traced back to underdeveloped business models.
A fundamental value creation challenge in a connected data-driven offering is finding innovation that creates customer value, changes the basis of competition and creates structural advantages that, in turn, creates sustainable enterprise value. Even the most creative business ideas can fail this value creation test when the innovation discussion centers solely on creating value through an operational process, a product, a services or a market innovation. A study by the IBM CEO Report explored how companies distribute their innovation efforts. While most businesses applied some effort into innovating across the board, business model innovation received the least attention.
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| Source: IBM CEO Report |
However, Companies focused on business model innovation delivered 5% higher five year compound annual growth rates. While businesses focused on product, service, or market innovation saw only slight growth. Those primarily applying process innovation were actually worse off.
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| Source: IBM CEO Report |
The reason is simple, technology is changing the basis of competitive advantage. Whereas it may have taken 18 months for a competitor to copy a new product, service or process in the past, the time is now often down to 6 months or less in many sectors.
A thoughtfully planned and well executed Internet of Things customer experience-driven business model innovation can change customer value, basis of competition, and create sustainable structural advantages that can take even the best "fast follower" several years to emulate.
Internet-of-things customer experience and business model innovation is complex. Difficult to get right, but important to do. Done right, it begins a never ending customer journey that always is capturing insightful data, and using that data to create a continuously improving customer experience and business model. Done wrong, an internet of thing customer experience and business model innovation can place companies into a Sisyphus-like proof-of-concept design and revision cycle, or can add a product to the same junk pile of history that one finds Google Glass. Get it right, your company and your future depends on it.
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Accredent specializes in the Business of The Internet of Things(tm). Formed in 2009 out a four year strategy, M&A, and business development engagement with companies that pioneered many of today's Internet-of-Things connected technologies, business models and use cases. Contact Us
Accredent has been successful partnering with business leaders of corporations, operations and product teams, and emerging ventures to develop and transform their businesses, accelerate revenue, growth and enterprise value through the Internet of Things. accredent.com
