Companies Lagging In Industrial IoT Readiness: Study
Many companies are unprepared for the Industrial Internet of Things (IIoT), but most executives at those companies realize that the future of their business depends on it, according to a new study released by the Business Performance Innovation (BPI) Network, a peer-driven thought leadership and professional networking organization reaching some 50,000 CXOs across the world.
The study also suggests that large-scale integrators and other channel partners will be among the biggest IIoT beneficiaries over the next several years. They will likely play a significant role in planning and implementation at many companies due to major internal gaps in the technical skills and management know-how needed to deploy and integrate IoT into operations and new products.
The new report, “The Impact of Connectedness on Competitiveness,” was developed by the BPI Network in partnership with the CMO Council, Penton’s IoT Institute and The Nerdery, a leading digital strategy, software engineering and design firm. The study was based on a global survey of some 350 global executives and interviews with innovation leaders at large global enterprises, including companies such as Airbus, Balfour Philips Lighting, Whirlpool, TVH, Hitachi among others. [Read the full report here]
“Executives are telling us that IIoT technologies are about to play a significant role in business and industrial performance, delivering significant improvements in operational efficiency and uptime, as well as growth from new business models, products, services and customer experiences,” said Dave Murray, Head of Thought Leadership for the BPI Network. “Nevertheless, less than 2 percent of large companies say they have a clear vision for how to move forward or have large-scale implementations underway. That dichotomy suggests we are experiencing the lull before the storm of IIoT transformation. This is an opportunity for real competitive differentiation and advancement.”
Among key findings of the IIoT survey, 52 percent of executives at large enterprises — and 41 percent of executives at all companies — expect IIoT to have a significant or major impact on their industry within three years. Some 55 percent of all executives say IIoT is gaining adoption within their industries, including both pilots and larger-scale adoption. However, just 1.5 percent of executives at large companies say they have a clear vision with implementation well underway, while another 57 percent are either beginning implementation, have pilots underway or are committed and in the planning stages.
The study also shows that new products and services lead as the area most companies say they will focus their IoT investments (35 percent), followed by customer touchpoints (29 percent), and manufacturing (23 percent). More cost-efficient operations (47 percent), product and service differentiation (36 percent), and improved customer engagement and satisfaction (34 percent) are seen as the top benefits of IIoT. Security and data privacy are seen as top concerns by executives, followed by the cost and complexity of IIoT adoption and the need for new management and workforce skills and training.
“For industrial companies, staying competitive requires embracing IIoT. There really is no plan B. Implementing IIoT, however, means not just navigating uncharted waters, but also keeping track of an array of technologies, workforce challenges, security concerns, and unprecedented business considerations,” says Brian Buntz, Editor of IoT Institute.
IIoT Readiness Lacking
Making the transformation to IIoT-enabled businesses will clearly require new skills and mindsets. Chief among those requirements, according to executives, are new technical skills (51 percent), better data integration and analytics capabilities (41 percent), and rethinking the business model (33 percent). Most executives, however, say their companies have significant gaps in these areas.
Some 31 percent of executives say their organizations face a “major skill gap” in their IIoT readiness, while another 31 percent say the talent gap is “large, but improving somewhat.” Twenty percent say their IoT skills are quickly improving, while another 7 percent believe they have most of the skills in place.
Similarly, just 12 percent give their company an “excellent” rating in their capacity to develop and deploy applications that utilize real-time insights and systems monitoring. Another 25 percent rate their capacity as good, while one-third say their corporation’s ability in this area is moderate and improving.
“Global businesses are clearly working to put the needed skills in place to address the opportunity of connected, intelligent products and machines, but those talents are in short supply,” the BPI Network’s Murray explained. “We can expect for the time being that system integrators, consulting and software engineering firms with the right skills in connectivity, sensor technology, data analytics and complex integration will benefit from the race to keep pace with IIoT enablement.”
Creating IIoT Value
Interviews with executives at large businesses that are deploying or planning for IIoT applications underscore the wide range of benefits and scenarios represented by these technologies. For example, Airbus, one of the world’s largest aircraft manufacturers, is also integrating sensor technology to improve the predictability and safety of its aircraft, but also envisions widespread use of IoT technology in its Factory of the Future platform—an approach that will include cyber-physical systems, 3D printed prototypes, open robot interfaces and advanced data analytics to increase the quality and productivity of its manufacturing processes. Factory workers use smart glasses and advanced image processing to track problems, tools and solutions in real time, while exoskeletons are developed to reduce risk and enhance human capabilities.
“The tidal wave that is connectedness and IIoT is building rapidly and it is unavoidable,” said Chris Locher, Vice President of Software Development at The Nerdery. “Companies see massive opportunities to increase efficiency, gather data in new ways and pivot into new business models. The challenge of the IIoT revolution is that it is accompanied by a great deal of white noise and confusion. How will companies capture those opportunities? How do companies avoid the risk of a failing at an IIoT initiative? How do you find employees with the skill to do it? The sheer scale and implications of IIoT can lead to information overload, create analysis paralysis, and confusion for business leaders.”
“The key to moving confidently into this new space is starting with small, focused efforts or bringing experts to start to build the required skills, behaviors, and business models,” concluded Locher.
- Travel, E-Com, Utility Lead To India's Digital Commerce Boom: Study
- Why Angel Investors Find Startups That Use A CRM Attractive
- 6 Key Trends For Artificial Intelligence Powering The Investment Sector
- 4 Things To Know Before You Move Everything To The Cloud
- How IoT Is Disrupting The Logistics Sector
- Home Automation Is The Next Big Thing, And Here Already!
- There's Potential To Unlock USD 50-Bn in India's Online Commerce
- Can Google Make A Successful Comeback In China?
- India Says 'Yes' To Net Neutrality; What Does It Mean
- Cloud In Industrial IoT To Cross USD 46K Mn By 2026: Research