Although many companies are unprepared for the Industrial Internet of Things (IIoT), most executives at those companies realize that the future of their business depends on it, according to a new study from the Business Performance Innovation (BPI) Network.
The results of the survey suggest that large-scale integrators and other channel partners will be among the largest IIoT beneficiaries over the next several years, a report from BPI Network explains. 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 report notes.
The 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 digital strategy, software engineering and design firm. It’s based on a global survey of 350 global executives and interviews with innovation leaders at large global enterprises, including Airbus, Balfour Beatty, Embraer, Philips Lighting, Whirlpool, LafargeHolcim and Hitachi.
“Executives tell 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,” says Dave Murray, Head of Thought Leadership for the BPI Network. “Nevertheless, less than two percent of executives at large companies say they have a clear vision for how to move forward, or have large-scale implementations underway. That dichotomy suggests we’re experiencing the lull before the storm of IIoT transformation. This is an opportunity for real competitive differentiation and advancement.”
Indeed, according the survey responses, 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. 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.
According to the survey respondents, companies will focus their IoT investments on new products and services (cited by 35 percent of the respondents), followed by customer touchpoints (cited by 29 percent) and manufacturing (cited by 23 percent). The main benefits of IIoT are expected by the respondents to be more cost-efficient operations (cited by 47 percent of the execs), product and service differentiation (36 percent), and improved customer engagement and satisfaction (34 percent).
Making the transformation to IIoT-enabled businesses clearly requires new skills and mindsets. Chief among those requirements, according to the executives, are new technical skills (cited by 51 percent), better data integration and analytics capabilities (cited by 41 percent), and rethinking the business model (cited by 33 percent). Most executives, however, say their companies have significant gaps in these areas: 31 percent of the executives said their organization faces a “major skill gap” in IIoT readiness, while another 31 percent say the talent gap is “large, but improving somewhat.” It’s encouraging to see that 20 percent of the executives said their company’s employees’ IoT skills are quickly improving, while another seven percent said they believe their organization’s employees have most of the skills in place.
“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,” Murray says. “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.”
What are your thoughts on the IIoT? Do you agree it will have a significant or major impact on your industry within three years? At the same time, does your organization have a skills gap in IIoT readiness?