To connect or not to connect? Few clues before jumping into the IoT world.

To connect or to not connect? Few clues before jumping into the IoT world.

Just like Hamlet faced a moral dilemma, you seem to be grappling with one too. Fortunately, in your case, there's no need to ponder the meaning of life or, worse yet, contemplate a revengeful murder on your uncle. Your challenge is simpler: deciding whether collecting data from things that have never been monitored before is worth the investment. Every investment involves risks, and this one is no different. In this article, I’ll guide you through a set of questions and tips we've gathered over time to help you minimize those risks.

First of all – why do you want to do it?

If we don’t clearly understand the reasons for investment or goals we want to achieve, we won’t know if we’ve reached the goal – or at least if you’re headed in the right direction. Ideally, you’re solving real business problems for yourself, your company, or your customers. You’re on the right track if your reasons for investing fall into one of these areas:

• Controlling and optimizing key business processes for yourself or your customers
• Preventing dangerous, catastrophic, or unwanted events
• Enabling new business models and opportunities
• Reducing costs through better control and efficiency
• Improving resource efficiency, utilization, and service delivery
• Helping others achieve their business goals

How will you measure success and return of investment?

If you're reading this, it means your reasons for investment fell into one of the areas mentioned above - great! Now, we need to define how to track whether we’ve reached or are getting closer to our goal. Think of it like a car’s navigation system. It guides us to our destination by setting waypoints, tracking our progress, and recalculating the route when we take a wrong turn or encounter unforeseen obstacles. While navigation systems manage our path on the road, when it comes to investments, we must handle it ourselves.

Besides financial metrics like ROI (Return on Investment), NPV (Net Present Value), and PP (Payback Period), which are important, it's also crucial to consider metrics directly tied to the reasons behind your investment. Ideally, these metrics should be in place and measured before the investment, providing a baseline for comparison as you move forward. Here are a few examples from different industries:

Food & beverages:

• quantity and time of packed products
• quantity of defective products
• amount of water used

Logistics:

• number of forklift stops
• number of battery incidents
• number of battery service actions

Agriculture:

• soil quality
• number of drought-related losses
• amount of fertilizer used

What regulations and risks does your industry face?

In some industries the regulations are rigorous. Medical device regulation (MDR), GDPR (general data protection regulation) are two examples for that. Violating these rules can lead financial penalties, certificate withdrawal, product recall, increased number of audits etc. Additionally, consider how your device will interact with its surroundings. Before making an investment, create a list of potential risks during and after implementation, not just those related to regulations. Understanding the scope of these issues will give you a clearer picture of the complexity and cost-benefit of your initiative, potentially leading to postponement or cancellation.

How will you integrate a new system into existing processes in your company?

You likely have processes and systems in place to track how your company operates and grows. Whether it’s a CRM, ERP, or even a simple spreadsheet – any new system you introduce needs to integrate smoothly into your company’s ecosystem.

Here are a few examples of how a new system can benefit your organization:

• Proactive customer service – A new system can detect potential issues before they occur and alert customers that service is needed.
• Faster response to market demands – In production systems, new integrations can provide real-time updates on orders, delays, and schedules.

Who will use it?

Who will use your new system once it’s done? The question isn’t about who is leading the project, but rather—who will be the main user once the project is done. Even if the result of our work is used by your customers, someone within your company is still responsible for those customers. The challenge is that after the investment has been implemented, what we’re left with is:

• more data
• more digital tools (website, mobile applications)
• more interpretations, visualizations, charts to analyze
• reports to track
• notifications to react to
• integrations to monitor
• procedures to work on

Working in a digitalized environment requires strong analytical skills. You need a person or team who understands the possibilities offered by current technology and has a vision for how the solution can be integrated into your organization. The earlier they join the project – the better. Also, don’t forget about knowledge sharing (to avoid silos, as mentioned earlier) and providing training in the later stages.

Continuously confirm, validate, check and test

Just like the car navigation systems we discussed earlier, we need to constantly check if we’re on the right path, and if not, adjust it. Modern solution development is faster, thanks to tools that streamline the process. When your future users are involved from day one, they can provide essential feedback and participate in demonstrations. If possible, install a prototype at a friendly customer’s facility—even better. Testing in the target environment not only provides technical feedback for engineers but also reveals if the customer finds the solution useful. If not, it helps us pivot quickly and address issues sooner.

In what situations will you abort the mission?

We can prepare for days, months, or years. We can cover countless scenarios and have answers to every question we imagine. Yet, something unexpected can still happen. Does that mean we were unprepared and should have spent more time planning? No. We need to accept that we’re only human. However, accepting this doesn’t mean “giving up”—it means defining the conditions for canceling the project. A great analogy is mountain climbing. To reach Mount Everest, you need to be physically prepared, plan your route, consult experienced climbers, and ensure your equipment is ready. But even with all that preparation, the weather might turn. Many climbers have had to turn back just before the peak because of dangerous conditions. For climbers “when to abort” is simple – “when weather doesn’t allow to climb further”. Similarly, you need to establish clear cancellation triggers to protect your organization from further losses. And maybe, in the future, you’ll try again.

Summary

The answers to these questions depend on you. Even if things are unclear now, once you work through them, you’ll be able to guide this investment toward success. You’ll know why you’re investing and what you want to achieve. You’ll have metrics to track progress and the ability to slow down or stop in case of setbacks. You’ll know where and with whom your solution will be tested and implemented, and you’ll have trained people to support you. Once you’ve got that foundation, all that’s left is to take concrete action—and we can help with that.