Metrics for IoT-Enabled Products

Metrics lag the introduction of new processes and new technologies by several years.  There are many reasons.  New business processes take years to evolve and become the new normal. Then, new measures get adopted. The infrastructure behind metrics is complex. People have to change what they track and record, then IT has to put it into a system. Management is uncomfortable with new metrics that do not have several years of past data. Few choose to recreate that data; rather they wait several years for it to accumulate and then they place the new metric into service. As well, R&D and product development are among the least understood major business functions. Business leaders hesitate to change measures in areas where they did not have direct experience on their way to the top of the corporate ladder.  Metrics for IoT-enabled products, processes, and technologies will be no different.

 

Risk Being Wrong

However, the IoT has been around for a few years now.  Some companies are in their third generation of IoT-enabled products and have some initial metrics in place.  Other companies are just warming up.  Given the almost unlimited scope of what the internet makes available, and thereby enables for all companies, picking one’s spots will be critical.

Discussions about appropriate metrics should probably begin sooner then they have historically begun.  Focusing on what to measure will spur the refinement of strategy and thinking on competitive positioning.

 

Get Organized

While there will be many new metrics, GGI estimates roughly fifty will be tried and will subsequently sort-out to a handful that will become widely adopted across industry, it will be best not to wait to see what others measure.  The playing field is nearly unlimited.  The generally adopted metrics may not yield the specific strategic advantages that most companies will seek.  Don’t sit back and wait to copy what others have done.

Over time, metrics will generally sort-out to four major categories:  Corporate Metrics, Project/Product Metrics, Functional/Technical Metrics, and Improvement Metrics.  A corporate brainstorming session might begin with these four areas for thought, and then seek input from participants using these general buckets to organize ideas.

 

Turn Over Rocks

At the next level of thinking, metrics for the IIoT and IoT will be different than many other corporate initiatives that have occurred over the years.  For example, take Open Innovation.  Whether a product originated organically or openly, the same measures capture customer experience.  This will not be the same for IIoT- and IoT-Enabled products. Data generated internally within a company’s IIoT may have some utility for customers.  Data acquired externally through the IoT, and/or a customer’s use of a product, may have some utility for the company that originally created the product – to enhance it, perhaps in real time.

These data may also be selectively packaged to create new “soft products,” that may or may not have anything to do with the value offering of the original product, that could produce incremental revenues and profits.  Few can see this far ahead.  It will take time for big data to accumulate to know for sure the assets one has, or has access to, but forge ahead with the thinking.

Thinking through these four areas will result in generating ideas that may then be subsequently refined to become Corporate Metrics, Project/Product Metrics, Functional/Technical Metrics, and Improvement Metrics.

 

Metrics for IoT-Enabled Products [Machine Design – July 2017] builds on these frameworks and suggests several specific metrics that may some day become generally adopted by industry – such as “Sensors Per Product.”

 

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MOON-ON-A-STICK

INNOVATION MASTERCLASS

Measuring Product Development Productivity & Performance

October 3-4, 2017

The Moller Centre

University of Cambridge

UK

BROCHURE

 

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