Setting up IoT for success: Common challenges to implementation and beating the odds

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Internet of Things (IoT) technology is becoming increasingly omnipresent in today’s business landscape. Bringing the technology into today’s context, the use of IoT can be a game changer for an increasingly digital-first business landscape characterised by remote work as a result of globalisation, and more recently, due the pandemic. 

Effective use of IoT technologies provide business leaders with increased oversight across the entirety of the organisation, aiding in effective decision making. With IoT well on its way to establishing an entrenched foothold as part of the new business fabric, what are some of the key drivers of this trend, and what are some of the benefits that adopters stand to gain from an organisational standpoint?

IoT as a business amplifier and game changer

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Southeast Asia ranks among the fastest growing digital economies globally, adding 40M new users in 2020 alone. The region’s Internet sectors continue to grow, a trend expected to be accelerated by the pandemic which has brought about a permanent and massive digital adoption spurt as organisations and individuals alike work towards maintaining social distancing measures.

With a growing number of decentralised teams and platforms at play, effective use of IoT technology can be useful to reconcile information from disparate platforms and data sources, and also across the digital customer journey. IoT platforms can deliver critical insights useful for effective decision making on issues identification, rectification, improving operations, as well as predictive analytics that can be helpful to automate existing processes, unlock new revenue streams, enhance customer engagement, and potentially reduce overall costs.

According to McKinsey, the worldwide number of IoT-connected devices is projected to increase to US$43 billion by 2023, with IDC forecasting spending on IoT in Asia-Pacific to reach US$288.6 billion in 2021. Closer to home, revenue delivered from IoT technologies in Singapore is set to grow at a CAGR of 14.78% between 2019 and 2024.

Despite the pertinent role that IoT plays in business operations, measuring success and justifying the ROI on the adoption of IoT technologies would be a key consideration for IT leaders. However, proving ROI has its challenges, with 89% of respondents from a survey of 25,000 IoT adopters citing difficulties in achieving ROI. The survey also found that a staggering 75% of all IoT projects were not considered successful.  

Why IoT projects fail

Those are sobering numbers, but in many cases, this lack of success has nothing to do with IoT technology. Simply put, we believe it is a reflection that implementing IoT isn’t straightforward, making it difficult to fully realise the promised benefits.

An analysis of the survey responses uncovered four consistent factors contributing to the failure of IoT projects, these being:

  • Business aims not clearly thought out – Poorly defined business objectives contribute to a lack of clarity on how to achieve stated goals, and are often due to a lack of understanding of project requirements and the complexity of the IoT solutions.
  • Company issues at an organisational level – The ability to effectively collaborate across functions is essential to success as IoT projects often require coordination between both internal and external stakeholders.
  • Unforseen technological problems – IoT projects require high-bandwidth, high-performance, low-latency network connectivity to function effectively. Not all networks are designed with IoT and scalability in mind, which could limit the effectiveness of any IoT solution implemented.
  • Customer/vendor problems – The complexity of IoT technologies often mean that organisations inadvertently implement plans and ROI targets that are too ambitious

Beating the odds

The good news is that there are ways to overcome this challenge. Based on our experience operating across global, digital first organisations, the key differentiator between success and failure was how companies addressed these aforementioned issues.

The first step before embarking on any IoT project would be to set clear business objectives. This establishes a clear vision for how IoT will be implemented within the organisation, and also the intended outcomes, facilitating decision making during the lifespan of the project. 

It will also be vital to set quantifiable and measurable targets based on the use cases and benefits these IoT projects might have. The advantages delivered by IoT projects may also be amplified via the use of data analytics, which can derive actionable insights to optimise outcomes. For instance, a fish farm might introduce the IoT as a solution to improve efficiency around feeding timings. The same sensors might also help automate the process and improve overall wastage of feed, lowering costs in the long run.

Once the business objectives are determined, we move on to design. It will be key to remember that any effective IoT solution developed needs to be able to orchestrate workflows between disparate platforms and systems, both internal, and external. To maximise gains, the solution implemented should be one capable of easily integrating IoT data with the core systems and processes that have and will run a business for years.

The solution should also be one that can be used by the layperson (of course, with the requisite training). This self-service IoT, can allow employees to connect devices, start consuming data from those devices, and create integrations and analytics on their own without the help of IT. This creates a more agile organisation capable of swiftly leveraging IoT capabilities to enhance its competitive edge.

Technical challenges and limitations should also be a key consideration. At the forefront of this is cybersecurity, every digital organisation’s challenge in a rapid digitalising economy. Businesses are liable not just for their own data, but also the data gathered from customers and partners, which could open them up to financial penalties and reputational loss. The stakes are higher when one considers how a cyber breach in one area could also lead to the compromise of other networked systems and cause a lengthy downtime, impacting business continuity.

Consulting professionals in cybersecurity, be it through recruitment or engaging consultants, can help organisations more effectively navigate related challenges, from taking basic precautions to introducing more sophisticated measures. 

Engaging third party expertise applies to other aspects of IoT implementation as well. While enterprise use of the technology is relatively recent, the IoT ecosystem can be massive, comprising small independents to large companies and systems integrators. IT leaders should look to leverage any existing knowledge instead of reinventing the wheel. Combining in-house knowledge and understanding with external expertise and experience is an approach most likely to lead to project success.

Long term success for IoT

While private organisations invest in digital transformation efforts, success will also be dependent on public sector stakeholders, who are well positioned to drive change on a national scale through regulation and policy.

For instance, Singapore’s Infocomm Media Development Authority (IMDA) has embarked on a multi-pronged approach to grow the IoT ecosystem in the city state. Efforts involve driving the development of IoT technologies in collaboration with private sector players, as well as formulating facilitative policies and regulation. 

With a cohesive public-private drive towards IoT technology, organisations can benefit from a differentiated and future-proofed brand as well as enhanced competitiveness – all desirable outcomes in today’s fast moving, digital-first market.