Organisations see growing importance in the Internet of Things (IoT) but few are yet to fully leverage the technology, according to a Forbes Insights report released today.
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The limited success of the much hyped IoT is due to its infancy, leaving many organisations in a “wait and see” position, according to the report authors.
“Companies are still learning the ins and outs of IoT, so it’s no surprise that many are still learning what works and what doesn’t,” they wrote.
The findings are contained in a Forbes Insight report, The Internet of Things: From theory to reality, created in association with Hitachi Vantara. To assess the state of IoT deployments, the report surveyed over 500 senior executives who led commercial and industrial IoT initiatives within their organisation.
The data suggests it is still early days for IoT operations. Globally, only half of the organisations with an executive leading IoT have implemented programs beyond planning and pilots.
In the Asia Pacific region, fewer than 1 per cent of respondents “depend on IoT to conduct business” and the majority (54 per cent) aren’t beyond pilot programs.
IoT is “no exception” to the problematic introduction of new technology and faces a diverse set of roadblocks, according to the report. Respondents views on the top five challenges to building out IoT capabilities where evenly spread. And like most new digital technology, cybersecurity was a top concern.
The limited implementation hasn’t dampened the executive’s enthusiasm.
“What’s clear is that the IoT is moving from theory to reality across the bulk of the business economy,” the report said.
“64 per cent of companies believe the IoT is important to their current business, and over 90 per cent believe it will be important to the future of their business.”
One third of respondents ranked IoT as the most important initiative in their organisation, beating robotics (26 per cent) and AI (20 per cent). AI is facing a similar slow adoption rate, despite growing confidence.
Who’s getting IoT right?
Some early adopters have gotten it right and their IoT programs “are doing what they should be doing—saving money, making the company more efficient or earning new revenues”. These companies represent 42 per cent of all executives surveyed.
The key, according to the report, is to not treat IoT as “just another IT program”. IoT must be enterprise-led and not an isolated R&D project. Two thirds of the successful IoT organisations used enterprise level governance.
But it is not necessarily a case of all or nothing for IoT. Most successful companies were starting small and the authors recommended implementing small projects (pilots, operational testing, demonstrations) to inform larger IoT initiatives and to always keep “a larger vision in mind.”
Partnerships also appear vital to IoT initiatives. 81 per cent of respondents from successful companies reported using third party IoT platforms and 66 per cent included vendors and suppliers on their IoT development teams.
According to the report, the most important objective of IoT initiatives in the local region are customer experience (17 per cent), increased productivity (17 per cent) and cost reduction (13 per cent) – all increases on global averages.
The ANZ region is also more concerned about security and talent. 53 per cent (versus 32 per cent globally) of ANZ IoT organisations identified security as their greatest challenge to IoT programs. While 43 per cent (versus 29 per cent globally) said they lacked the talent to manage the data generated by IoT initiatives.
70 per cent of ANZ executives said they were employing the small projects/pilot program approach before implementing larger initiatives.