Capitalizing on The Internet of Things
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1 Capitalizing on The Internet of Things March 2016 Capitalizing on The Internet of Things
2 Table of Contents Executive summary... 2 Transforming from a product business into a service business... 2 The core benefits of IoT... 4 The core challenges of IoT... 6 Five fundamentals to consider when evaluating how your company can best leverage IoT... 7 Capitalizing on The Internet of Things 1
3 EXECUTIVE SUMMARY The Internet of Things (IoT) is not about things, it s about service. The Internet of Things (IoT) described aptly as the convergence of the digital and physical worlds is transforming the way business is done across every sector of the economy, in every industry, across the globe. There is one thing that every company prospering from IoT today has in common: they understand that IoT is not about things, it s about service. Devices and products (things) are simply tools that help businesses establish a direct, always-on connection with their customers. IoT turns those devices and products into service-delivery vehicles, capable of continuously unlocking new value for customers and sources of revenue for your business. This paper will look at how companies are successfully capitalizing on the Internet of Things today: Demonstrate why the shift to IoT services is inevitable and critical to the success of connected businesses. Highlight the core benefits of the Internet of Things. Address the core challenges of the Internet of Things. Explore the fundamentals to consider to successfully leverage the Internet of Things. IoT turns devices and products into service-delivery vehicles, capable of continuously unlocking new value for customers and new sources of revenue for your business. Share success stories of leading companies capitalizing on IoT to create new lines of business, evolve existing products and innovate business models today. TRANSFORMING FROM A PRODUCT BUSINESS INTO A SERVICE BUSINESS When every product you sell is connected any time, all the time, it fundamentally changes how you operate, how you interact with your customers and how you make money. As an IoT business, value shifts from the products themselves to the services they enable. One-time product sales quickly become obsolete as customers expect you to continuously add value and deliver new experiences over time in the form of new connected services. And you are now responsible for every part of the connected service experience. Customer has a question? You d better be ready with the answer. Connectivity hiccups? Customers are counting on you to know why and to fix it, now! Plus, you have brand new sources of revenue to manage. Capitalizing on The Internet of Things 2
4 Always-on IoT services present new and unique operational challenges. Navigating this kind of transition requires major shifts in mindset, processes, people and skills. It requires creating new business models, operating structures and management functions. Always-on IoT services present new and unique operational challenges that you must address: How will you on-board new devices, provision network services and set usage policies? How will you monitor and optimize service performance? How will you diagnose and resolve service issues remotely? How will you monetize your services and manage costs? How will you scale your IoT services, whether to the next 10,000 customers or around the globe? Becoming a successful, service-centric IoT business requires four key elements: Devices with embedded connectivity. Networks for those devices to connect through. Applications and IT systems to power operations. An IoT service platform that enables you to capitalize on real-time interactions with customers. THE ENTERPRISE SOLUTION Global Devices Global Networks IoT Service Platform Enterprise Back Office IoT Apps Traditional IT ERP, CRM, SCP, BPM, Analytics Global Devices Global Networks IoT Service Platform Applications and IT Systems The connected devices or products that enable you to offer services to your customers. Mobile network operators who provide device connectivity to the internet. An IoT service platform to efficiently manage IoT service operations. The software or applications that deliver the IoT services. Capitalizing on The Internet of Things 3
5 THE CORE BENEFITS OF THE INTERNET OF THINGS As an IoT business, value shifts from the products themselves to the services they enable. When your company and all of the devices you sell and manage are connected to your customers at all times, your business transforms: You create and deliver a host of new experiences for your customers. You automate manual processes and drastically reduce response times. You understand the state of your business in real time and make more accurate predictions about where it is going. Benefit 1 Create and deliver new experiences for your customers Offer new services: GM turns its connected cars into Wi-Fi hotspots, complete with entertainment offerings such as Netflix and Spotify. Enhance existing products: Garmin now offers a subscription add-on to their professional navigation devices. Garmin Traffic provides fleet managers with real-time information to help them better manage commercial operations and enables their drivers to avoid costly delays. Build entirely new ways of doing business: Konica Minolta uses built-in connectivity to proactively monitor copiers and address performance issues, both vital to usage-based billing models. Benefit 2 Automate manual processes and drastically reduce response times With tons of realtime actionable data, IoT enables more-informed decisions about what to do right now, and what to do next. Run remote diagnostics: Alarm.com monitors the status of every home automation and security system on their network, enabling them to respond instantly to reported incidents. Manage physical assets: John Deere s JDLink service lets farmers track all of their machines and program exactly where to plant, fertilize, spray and harvest to optimize crop yields. Deliver proactive service: ABB monitors its 250,000+ connected robots to enable proactive service. With precise and reliable information about what s going with a robot they can anticipate problems, enabling ABB to provide excellent customer service and ABB s customers reduce downtime and improve efficiency, productivity and quality of operations. Capitalizing on The Internet of Things 4
6 Benefit 3 Understand the state of your business in real time and make more accurate predictions about where it is going With tons of real-time actionable data, IoT enables more-informed decisions about what to do right now, and what to do next. For example, you ll know when and where your product is used and what features are used. If the product isn t being used, you ll know and be able to respond accordingly. With this data, you ll be able to: Protect and enhance your brand: In Europe, Heineken monitors the volume, temperature and age of connected kegs to manage inventory and ensure the quality of its beer. Tailor your product offerings for a personalized experience: Allstate Drivewise collects data on driving behavior and actual usage, rewarding safe drivers with preferred rates. IoT automates previously manual processes, enabling you to be more agile, responsive, and focus on the most valuable parts of your operation. Understand how your customers use your products: AirLiquide uses a bar code on its Servitrax connected cylinders, enabling customers to track and manage their use, status and location at every stage, from initial delivery to return to manufacturer. Indeed, connecting your business to The Internet of Things touches every part of your company and reshapes it for the better. IoT services bring you much closer to your customers, giving you a deeper, richer understanding of what makes them tick. IoT automates previously manual processes, enabling you to be more agile, responsive, and focus on the most valuable parts of your operation. IoT services bring new revenue streams, efficiencies, and pricing strategies to your business model, moving you from sales of individual products that pay once to sales of ongoing, connected services that pay again and again. But with these substantial benefits come a host of significant challenges. Capitalizing on The Internet of Things 5
7 THE CORE CHALLENGES OF THE INTERNET OF THINGS Companies new to IoT need to cost-effectively and quickly launch, manage and monetize their IoT services. Challenge 1 Launch your IoT services Devices exist in different states depending on the stage of use: activated, deactivated, retired, testing, etc. That state determines the device s ability to establish data connectivity and whether the device is billable. Launch When deploying devices into the field you need to map policies, permissions, usage and rate plans to the appropriate state, define use cases and map requirements, integrate your new IoT service with your existing infrastructure and configure APIs, and of course deliver the new services to market. Challenge 2 Manage your IoT services Manage Defining standards for how you expect your devices and services to behave over time will enable you to be highly responsive. You ll want to map actions to predefined standards and automate responses. With real-time visibility and control you can track data usage and connectivity, remotely identify and diagnose issues, and continuously monitor changing network conditions and device behavior. Challenge 3 Monetize your IoT services Monetize Services are a lucrative source of new and recurring revenue. However, if usage and rate plans aren t rigorously managed, unexpected costs can quickly erode margins and cut profits. You ll need to monitor usage to understand the services that are being used, define and automate real-time rate plan adjustments, and analyze intelligence to ensure your devices are running at the lowest possible cost at all times. Given these challenges, where do you start? Capitalizing on The Internet of Things 6
8 FIVE FUNDAMENTALS TO CONSIDER WHEN EVALUATING HOW YOUR COMPANY CAN BEST LEVERAGE IOT 1 Start with service IoT is a direct and always-on connection between your business and the rest of the world. It both enables, and sets an expectation that you will continue to deliver a steady stream of new services as long as your customer owns your product. As you are developing your IoT business plan, prioritize the development and delivery of value-added IoT services. This will give you an advantage. 2 Operate in real time Real time. All the time. Those are fundamental concepts with the Internet of Things. Businesses need visibility and real-time control to manage connected services and ensure the best possible experience for their customers. Software-as-a-Service (SaaS) models, delivered via the cloud, are ideal for IoT businesses. Companies are finding that cloud-based solutions deliver critical advantages such as speed, efficiency and global access. They also address practical considerations, from minimizing start-up costs, to enabling scalability, and supporting business agility. AN IoT SUCCESS STORY: HOW GM IS TRANSFORMING THE CONNECTED CAR EXPERIENCE General Motors (GM), the world s second largest car company, is on the leading edge of connected vehicle experiences and new business models. Its entire fleet of vehicles in North America comes equipped with 4G LTE, and GM announced that they plan to offer automated driving technology in These are just two of the latest innovations among their portfolio of high-value, in-vehicle services. GM is truly transforming the connected vehicle experience, recognizing that today s consumers want a reliable, comfortable vehicle, with a full array of services from safety to entertainment, to integration of other applications and devices. To meet that demand, GM is continuously innovating and offering connected services that include communication, security, emergency assistance, turn-by-turn navigation, remote diagnostics, plus a range of infotainment services such as streaming audio and video for backseat passengers. In addition to the fast and reliable 4G LTE connections that will ultimately be made available worldwide, GM is transforming millions of its cars and trucks into Wi-Fi hotspots. And, as part of its complete in-vehicle mobile experience, GM now offers a wide selection of applications. Many of these apps are created through their dedicated app developer program and are deeply integrated into the vehicle s sensors and telematics systems through the connected car APIs. GM has long been at the vanguard of the IoT trend, identifying it early on as a route to transforming the industry business models and the customer experience. Today, the company is executing the strategies they ve been developing for years on a mass-market scale, defining the next chapter in automotive history. Capitalizing on The Internet of Things 7
9 3 Plan to scale Companies new to IoT need to cost effectively and quickly launch, manage and monetize their IoT services. Whether you are a multinational corporation or a regional player in your industry, you will need to scale your business. As you are building your IoT business, take the time to think long term and anticipate success. Ensure that you are choosing solutions and partners capable of seamlessly and costeffectively supporting your future needs. 4 Automate, automate, automate Each deployed device requires more than 100 real-time actions per year, such as provisioning, billing, diagnostics, and more. At a modest 100,000 deployed devices, that s 10 million actions per year, making manual processes inefficient, costly and simply impractical. Automation reduces response times, streamlines operations, enables your business to be more agile and responsive, and allows you to focus on more valuable parts of your operation. 5 Learn from industry best practices Have a look at what other businesses are doing with IoT, including those outside your industry. The possibilities are limited only by the imagination of the practitioners. And some of the most inspiring innovations come from the most unexpected places. Lessons learned from IoT-driven transformations in industrial manufacturing, automotive, home security and agriculture could be applied to industries as diverse as oil and gas, retail, and food and beverage. Capitalizing on The Internet of Things 8
10 CONCLUSION You can t afford to ignore the Internet of Things. IoT is enabling new business models and customer experiences across industries and around the globe. This is a powerful, quantifiable force and a business imperative. Any company looking to connect with customers and generate new and sustainable sources of revenue will benefit from IoT. ARE YOU READY TO CAPITALIZE ON THE INTERNET OF THINGS? Forget the hype the Internet of Things (IoT) is changing how companies do business today. Companies worldwide are capitalizing on the Internet of Things (IoT) to drive business transformation and deliver innovative connected services. JASPER IS THE ON SWITCH FOR THE INTERNET OF THINGS. Jasper is a global Internet of Things (IoT) platform leader. Jasper has designed its industry-leading, cloud-based IoT platform to enable companies of all sizes to rapidly and cost-effectively launch, manage and monetize IoT services on a global scale. When companies do this, they become much more than product businesses. They become service businesses, capable of automatically managing their customers entire IoT service lifecycle, delivering increased customer value and unlocking new sources of revenue. Thousands of companies in more than 20 industries, including many of the world s top brands, choose Jasper to fast-track their IoT services. Jasper partners with 25+ mobile operator groups, representing more than 100+ mobile operator networks worldwide. Contact Jasper today at or request a demo at Capitalizing on The Internet of Things 9
11 Jasper. All rights reserved. Capitalizing on The Internet of Things WP_COTIoT_
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