Four things CIOs can do to get in front of IoT

By Andy Daecher, Principal and Practice Leader-IoT, Deloitte

Most CIOs today recognize that the Internet of Things (IoT) is going to be a very big deal, and that it’s likely to happen sooner rather than later. They just aren’t sure what IT’s role should be.

So far, the vast majority of IoT initiatives have been launched and executed entirely within the business, without involvement from the IT function. That’s generally a good thing because it means IoT is driven by real business needs. However, at some point – perhaps very soon – IoT could reach an inflection point where the scope and magnitude of IoT-related activities really take off.

When that happens, the current environment of pioneering innovation could quickly devolve into the wild, wild west, with dozens of isolatedinitiativesacross the enterprise all vying for resources and pursuing their own individual goalswith no regard for what everyone else is doing.

We’ve seen this pattern many times before. The results? A hodgepodge of IoT processes and technologies that compete or conflict with each other. Massive duplication of effort. Rampant inefficiency. Poor scalability. And a total lack of standards.

In that wild west environment, CIOs and the IT function have a valuable role to play – using their deep expertise and experience managing large-scale technology to help bring order to the chaos.

In a few cases, that might mean stepping in and laying down the law. But more often than not, a CIO’s role in IoT will be less like the new sheriff in town and more like a peacemaker and enabler, helping to bring everyone together and finding ways to align their disparate activities and technology solutions into a unified effort with a shared vision, shared goals, common governance and architecture, and standardized technologies and processes that boost efficiency and can be easily scaled as the use of IoT grows.

Here are four things CIOs can do to help them get ahead of the IoT curve:

1. Engage with the business and understand how IoT can add value.

Learn how leaders in the business and operations are thinking about IoT, and what IoT projects are currently underway or in the pipeline. Understand their goals and challenges, and what value IoT brings to the table. Forbusiness leaders that haven’t startedthinking about IoT, help them understand the technology and how it could be applied to create business value.

2. Figure out the right role for IT.

At this early stage of maturity, the technology solutions that support IoT are often handled by people in operational technology (OT) – the business-based technology groups typically responsible forthings like product engineering, factory floor automation, warehouse management systems, and supply chain optimization.However, as IoT proliferates, the need will likely emerge for the CIO and IT to play a larger role.

What that role will look like varies from one company to the next, depending on its unique business needs, the specific competencies of its IT and OT groups, and even individual personalities and corporate politics. In many cases, it will likely make sense for IT to take the lead in IoT. In other cases, OT might continue to run the show with IT in a secondary role. In some cases, new roles will emerge like the Chief Technology Officer (CTO) and Chief Digital Officer (CDO) that may encompass OT or both OT and IT.But in nearly all cases, IT will likely achieve the most results if it positions itself as an enabler and accelerator – rather than as a gatekeeper or barrier that gets in the way and slows things down.

3. Develop new competencies.

The most effective IoT efforts tap into the data and insights held within the traditional enterprise systems with which IT is already intimately familiar. However, IoT also involves new technologies and new ways of working that may push IT beyond its comfort zone. In particular, IoT tends to focus on computing and data at the “edge” –far away from IT’s data centers and enterprise systems. Thus, depending on IT’s chosen role, there may be a need for IT to develop or acquire new competencies in areas such as sensors, mobile devices, advanced analytics tools, and real-time streaming of vast quantities of data.

4. Think big. Start small. Scale fast.

IoT has the potential to change the world – much like the internet itself has done– so when dreaming up IoT applications and developing an IoT strategy, it’s important to think on a grand scale. However, when it comes to execution, efforts that bite off too much at once tend to collapse under their own weight. Also, IoT tools and use cases are rapidly evolving, which means that multi-year (or even multi-month) implementations could very well be obsolete before they even get out the door.

In our work with companies that are successfully harnessing the power of IoT, we’ve found the most effective approach is to think broadly about the potential uses and impact of IoT, but to get the ball rolling with small pilot programs focused on specific areas where IoT can quickly deliver value. This helps build momentum with early wins,while establishing a strong foundation for rapidly expanding the scale and scope of the IoT effort.

Time for action?

Given IoT’s vast potential, we believe that getting in front of the curve should be on every CIO’s agenda. However, the level of urgency varies from one business to the next. In industries such as banking and financial services, the applications and benefits of IoT are not yet clear – and key issues such as privacy and security loom quite large – so CIOs in those industries have some time to figure things out. On the other hand, IoT is already having a big impact in energy, industrial manufacturing and automotive, so for CIOs in those industries the time for action is now.

 

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