Learning from IoT project failures

Industry 4.0

Learning from IoT project failures.

 

At the recent 2017 Internet of Things World Forum (IoTWF) held in London, leading global market company  IDC predicted that the worldwide installed base of Internet of Things (IoT) endpoints will grow from 14.9 billion at the end of 2016 to more than 82 billion in 2025

 

Despite this momentum, a new study conducted by Cisco shows that 60 percent of IoT initiatives stall at the Proof of Concept (PoC) stage and only 26 percent of companies have had an IoT initiative that they considered a complete success. Even worse: a third of completed projects were not considered a success.
According to Cisco, 1,845 IT and business decision-makers in the United States, UK, and India across a range of industries were studied. The came from a range of industries including manufacturing, local government, retail/hospitality/sports, energy (utilities/oil & gas/mining), transportation, and health care.

 

All respondents worked for organizations that are implementing or have completed IoT initiatives. All were involved in the overall strategy or direction of at least one of their organization’s IoT initiatives. The goal was to gain insight into both the successes as well as the challenges that are impacting progress. The key findings were:

 

The “human factor” matters

IoT may sound like it is all about technology, but human factors like culture, organization, and leadership are critical. In fact, three of the four top factors behind successful IoT projects had to do with people and relationships:

 

– Collaboration between IT and the business side was the number one factor, cited by 54 percent.
– A technology-focused culture, stemming from top-down leadership and executive sponsorship, was called key by forty-eight per cent.
– IoT expertise, whether internal or through external partnership, was selected by a similar number.

 

Don’t Go It Alone

Sixty per cent of respondents stressed that IoT initiatives often look good on paper but prove much more difficult than anyone expected. Top five challenges across all stages of implementation: time to completion, limited internal expertise, quality of data, integration across teams, and budget overruns.

 

The study found that the most successful organizations engage the IoT partner ecosystem at every stage, implying that strong partnerships throughout the process can smooth out the learning curve.

 

Reap the Benefits

When critical success factors come together, organizations are in position to reap a windfall in smart-data insights. Seventy-three percent of all participants are using data from IoT completed projects to improve their business. Globally the top 3 benefits of IoT include improved customer satisfaction (70%), operational efficiencies (67%) and improved product / service quality (66%). In addition, improved profitability was the top unexpected benefit (39%)

 

Learning from failure

Taking on these IoT projects led to another unexpected benefit. Sixty-four per cent agreed that learnings from stalled or failed IoT initiatives have helped accelerate their organization’s investment in IoT. Despite the challenges, many in the survey said they were optimistic for the future of IoT

 

To learn more about the survey, go here

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