Peter Cooper, senior product marketing manager with Microsoft IoT, is in the process of writing a four-part series of blog articles for the Microsoft Azure site, aiming to help companies maximize ROI on their emerging Internet of Things (IoT) footprints.
Along the way of discussing how IoT can transform businesses, in his latest post, Cooper shares insights into how companies can begin to create successful IoT strategies that yield desired ROI outcomes.
The blog breaks the crafting of such strategies down to six key elements:
1. Have a vision of where you’re headed
As cited by Cooper, "According to McKinsey, the first 15 or so IoT use cases typically provide modest payback, but enable companies to develop the expertise they need to expand IoT’s footprint in their business. For IoT leaders, that can mean cost savings and new revenue gains of 15 percent or more."
McKinsey & Company is an American worldwide management consulting firm that conducts qualitative and quantitative analysis to evaluate management decisions across both public and private sectors.
2. Define what ROI means to your company
Cooper notes that "it can be difficult to calculate the ROI for IoT projects because there are so many variables, and business processes that don’t exist in isolation. However, doing so will enable cross-functional IoT teams to win and keep executive sponsorship and demonstrate progress over time."
3. Get everyone on the same team
Cooper contends that "IoT leaders [should] communicate a plan for when and how they will serve the different lines of business and win their patience and cooperation." He adds, "For [certain] lines of business, the wait could be years, not months, for an IoT project."
4. Align your enterprise strategy to real needs
Cooper warns that "when starting with IoT, it’s tempting to set a big and audacious goal. Yet, the reality is that companies will probably have more success if they start with something small and quantifiable and quickly solvable, and then build on it."
5. Collect only the data you need
As cautioned by Microsoft's Cooper, "Because of IoT’s ability to optimize processes, it’s tempting to connect everything and pan for gold in the torrents of data that result. However, the reality is that businesses analyze only a fraction of the data they possess."
6. Consider starting with services that prove the value of IoT
"Optimizing services is the number one strategic IoT priority for companies today, according to McKinsey," concludes Cooper.
Tweets by CablingTweets