Business Strategy and Innovation Framework
3.2 THE TRANSFORMATION OF BUSINESS MODELS WITH THE INDUSTRIAL IOT
IIoT is set to transform business models in all markets in broadly similar ways:
� extending the overall business model and market approach with customers to incorporate new value-generating elements,
� providing a basis for unifying disparate internal organizational elements, processes and information, � enhancing the development and production of goods and services and � increasing the variety of avenues for enhancing customer value and experience.
3.2.1 GENERAL BUSINESS MODEL AND MARKET TRANSFORMATION
Many current business models place strong emphasis on the effectiveness of internal production processes. The focus of these models will broaden considerably in the IIoT world to include more emphasis on customer relationship and value creation.
In the IIoT age, business models must still take account of traditional internal elements while simultaneously transforming themselves to take advantage of the new spectrum of possibilities. IIoT will affect operations, product development, marketing and the overall business value chain. Business models must adapt to accommodate and take advantage of these changes.
Beyond this more general development, a significant opportunity exists for technology developers to expand their business models into new markets, where they will function as IIoT enablers. Offering their products and technologies for use as stand-alone or embedded elements within other systems will open up new avenues for product distribution. These technologies may include software, devices, sensors or mechanical elements. This opportunity also exists for providers that offer services rather than products alone.
Enterprises that shift their business model as suggested here will realize increased market value from the deployment of IIoT concepts, provide greater value to their customers, become more agile and provide differentiating value to their customer base. Businesses that do not take advantage of IIoT will risk quickly losing market share to competitors that embrace it.
3.2.2 UNIFICATION OF DISPARATE BUSINESS ELEMENTS
Depending on the market segment, the new‘ factory floor’ can be almost anything: an equipment-manufacturing plant, department store, airplane or even a hospital room. Any one of these locations has the potential to produce a massive amount of data. In contrast to today, IIoT will provide the opportunity to connect different parts of a business and unify its data, from device to IT. This integration can lead to improved analytics and improved human and machine decisions. Bringing these disparate sources together will require a new paradigm of how organizational elements operate together.
New business models will have to take data connection, collection and analytics into account. They must also consider the implications of bringing together data sources across all levels of the organization( including from outside of the organization), where analytical capability needs to
IIC: PUB: B01: V1.0: PB: 20161115- 15-