ISG Provider Lens™ Internet of Things Quadrant Report 2018 - Overall IoT Services
- Internet of Things (IoT) is the core of connectivity across networks, systems, data and objects. From industrial assets to everyday things to people, IoT can bring much of the physical world into a connected ecosystem. The key to a successful IoT implementation are setting the right objectives, managing the flow of large amounts of data and capturing the data points necessary for deriving benefits and insights.
- The IoT market has been evolving fast while the adoption rate has been moving at a steady pace. From standalone point solutions to overall end-to-end offerings both for technology providers and business buyers, the IoT market has grown substantially but not as fast as some expectations.
- Businesses are understanding the potential that an IoT ecosystem can offer. Companies are becoming more competitive by using different ways to drive business improvement. From improved client experience to better business outcomes, the benefits of IoT are obvious.
- Businesses are expecting more synoptic potential from an IoT ecosystem but are not conceding security and functionality. Specific industry-related IoT has been more favorable and profitable as compared to general business solutions that are targeting business transformation.
- Cost efficiency is important for both the service provider and the buyer when starting an IoT implementation discussion. The biggest challenge that slows down IoT adoption growth is that program outcomes often have not matched the investments for implementing and adopting an IoT ecosystem.
- Strong value cases have emerged in some verticals. The difficulty of generating positive return on investment (ROI) from IoT investments varies by industry. IoT has shown its value in the manufacturing, energy and utility industries. Some of the areas where manufacturers have benefited most include operational process optimization and improved predictive maintenance through planning and an understanding of work patterns. Other key focus areas include connected and smart factories, inventory management and supply chain optimization.
- More industries and use cases continue to develop. Other verticals and use cases where IoT has been progressing include healthcare, transportation, smart cities and smart offices. Consumer-connected areas including retail, hospitality, smart homes, and connected vehicles have also seen IoT progression. Some IoT applications fit both the industrial and consumer markets and are often referred to as cross-industry use cases.
- An agile approach enables IoT progress. Applying agile principles for product development at different levels of the IoT ecosystem gives developers more innovation time and helps improve project management; it also lowers cost. Product quality improves with agile product development, which helps to reduce overall costs by lowering service costs.
- Experts around the world believe that there will be more than a trillion devices connected by 2020 which has made IoT a focus area for most organizations. As growth occurs, it will be important for enterprises to determine the right proportion between the cost and outcome of adopting the IoT ecosystem and the ease of maintaining and securing any IoT infrastructure adoption.
Solution providers have been continuously trying to add value to their client organizations’ IoT implementations. Starting with the early point solutions, big data analytics and predictive maintenance, solution providers helped enterprises to understand IoT and to determine how to use it to maximize their investment returns. The following are key perspectives for an end-to-end IoT implementation journey that solution providers should consider.
- Clients need consulting help to plan and ideate the business problem and to address it to reach business benefits. IoT implementations might create business benefits by reducing costs, increasing efficiency, creating a better customer experience or making other improvements. Thus, to make an IoT adoption successful, clients should consult service providers to plan strategies, develop a business case and establish the processes for IoT use cases.
- System integration and implementation is the next step in collecting the data. Devices and sensors are available for monitoring different types of activities and conditions. The parameters to monitor are different in each business case. They vary considerably and can include tracking temperature, location, speed, pulse and other characteristics.
- Big data and analytics are closely related to IoT. The huge amount of data flowing from different sensors and other devices needs proper management. Collected data needs proper analysis to derive insights for business functions. Data also needs to be continuously available to generate regular benefits. Using dashboards can improve visualization and help top management to make decisions on mobile devices and in real-time.
- Platform adoption is a key step in the IoT infrastructure journey. ISG defines an IoT platform as: an array of components that helps in providing the interface to initiate data and device management within a defined infrastructure in association with communication protocols and security management. Platforms are the critical enablers that bridge gaps and bind the IoT ecosystem.
- Network and communication can take many forms. Creating the right communication structure depends on the needs for range, transmission capacity, usage, isochronous connectivity, compatibility and – most importantly – security.
- Scalability and flexibility are needed in software and applications. The number of connected devices increases every hour. This thereby increases the need for good software behind every IoT product and service. Organizations have problems integrating dynamic software capability. Developers now need to marry software components and Internet connectivity for a secure, efficient and reliable operation. Software developers are constantly updating software and applications based on the needs of IoT use cases.
- Security starts with design. Security is one of the biggest inhibitors of IoT expansion and acceptance. Therefore, service providers need to address security at every step in an IoT ecosystem – from the design phase to implementation – and must also cover the connected device and all network levels.
- Managed services are available for different operational aspects. Enterprises have different options to consider for IoT managed services. One option is for service providers to manage the IoT infrastructure after implementation. This approach can relieve the enterprise customer from involvement in the complexities of the implemented ecosystem.
Digital transformation and digital reinvention is the journey an organization takes to achieve optimization in all areas – process, systems, culture and transformation of the entire business model and ecosystem. Internet of Things is one of the core pillars of the digitization and transformation journey that organizations undertake. IoT can help organizations achieve operational efficiencies, create new business value and enhance customer experiences through the help of smart and connected products, solutions and ecosystems.