Expect more from IoT

planningRecently there was a post in Forbes titled In Search of the True Value in The Internet of Things. This post narrowed down the value statement to:

The real value lies in being able to capture and analyze the data that comes from the sensors at the endpoints of IoT — and that needs to be the few nuggets of data that are of material value to the business.

It does make me wonder if the author overlooked the new business model possibilities. It is not just about capturing and analyzing, it also include the action taken by which actors for the company and its entire ecosystem. As everything ‘gets smarter’ there should be more options available and more time to execute those options. At the same time we see larger and more powerful arrays of processors, we also see them moving into more places and processes.

One of the great questions that remains is what should ‘we’ be doing differently now that computing’s impact moves both deeper and broader into the business?

The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow. -William Pollard

I survived my first day at SAP #SapphireNow

The one area that both surprised and interested me most on the first day had little to do with the analytics or IoT space (although I did have some interesting discussions in those areas too). It was the SAP approach to their on-line store.

They have had many on-line stores in the past but now they are taking a different more ‘digital’ approach that is focused on selling direct to the consumer. This will change the relationship with the user and the enterprise based on consumption. This could disrupt their traditional buyer, the SAP sales force as well as their partners that perform system integration and consulting. It will be interesting to see if this level of change can take place without too much disruption.

By selling tools like Lumira with a free version, then a low friction purchase option with a credit card a business could easily see this tool enter into its portfolio of resources without their knowledge. They have implemented the purchase process so that if a feature of a premium version is needed you are dropped into the store. Anyone who has done on-line gaming recently has likely run into this behavior. This kind of stealth selling is inevitable and will accelerate the kind of shadow IT has been discussed for years.

I asked the people at the booth about what happens when someone buys it on their own version and the company purchases a master agreement. The answers varied a bit but the individual has a choice to roll into the agreement or continue to pay on their own. Look to the terms and conditions (that no one reads typically) for the details.

There is also the concern about who will support anything that gets created once the business becomes addicted. Everyone likely remembers the years of Excel Hell. Hopefully that will not happen but I am still checking into how change management elements can be put in place for end user developed elements.

My greatest concerns is that the traditional command and control IT organization will be very frustrated by this, while the digital purists will be confused by the resistance – it may be just outside their contextual understanding. SAP stated they will be opening these capabilities up for 3rd parties to sell their capabilities and that will have its own problems. Service providers usually sell apps as a mechanism to facilitate up-sell into consulting and integration. SAP is trying to ensure what gets into the store is valuable on its own. Some of the service providers will likely have a hard time understanding these implications as well.

It was stated (many times) in the first day that business models are changing and SAP seems to be doing its part to be disruptive, even if most of its customers haven’t internalized the implications.

Waste can be Good – it’s all relative

AbundanceAs businesses makes the transition to where the edge of the enterprise is wired into the operational processes of the business, we will start to consume our resources quite differently than we have in the past. We can use the abundance of computing capabilities to shed light on all the dark data currently available to develop a deeper contextual understanding of situations we encounter. Money may not be growing on trees, but there is much more we can be doing.

An article in Wired magazine back in 2009 discussed how: Tech Is Too Cheap to Meter: It’s Time to Manage for Abundance, Not Scarcity. In this world of exponential increases in capability, 2009 is ancient history, even so, the article is useful. It works through examples like how Alan Kay used the precious resources of the computer to display pictures on the screen instead of just textual data. George Gilder called this “wasting transistors” — making people more productive by using the transistors (computing capability) available.

The funny thing about waste is that it’s all relative to your sense of scarcity.

As we look to use higher levels of automation to handle more “normal” activities and focus people’s attention to turning anomalies into opportunities, we’ll use pattern recognition and other techniques that may appear to waste cycles. I hear people today complain about the expense of cloud computing and that it is out of control. That is more about what they use these resources for, how they measure impact and exercise control than anything to do with cost, at least from my perspective. As more capabilities become available and algorithms improve, we’ll need to do even more with more – not less.

The Wired article shows how behavior needs to change as we move from a perspective of scarcity to abundance:

From a perspective of Scarcity or Abundance

Scarcity Abundance
Rules Everything is forbidden unless it is permitted Everything is permitted unless it is forbidden
Social model Paternalism (We know what’s best) Egalitarianism (You know what’s best)
Profit plan Business model We’ll figure it out
Decision process Top-down Bottom-up
Organizational structure Command and control Out of control

This kind of shift in perspective is disruptive, useful and the right thing to do to take maximum advantage of a truly scarce resource – the human attention span.

In-shoring opportunities in with automation

AutomationI had a long discussion with a serial entrepreneur last week that is looking to define a service offering in the help desk/virtualized meeting/education front. He seems to have a good handle on the business model and the differentiation between what he provides and the other services in the market place.

During the discussion, it did remind me a bit about the CNN post about the effect of Silicon Valley’s virtualization and automation efforts on jobs. What was most intriguing about the discussion was the ability to move the skills in demand to underserved parts of the country.

We both grew up in small mid-west towns and feel that techniques virtualizing the workforce he is developing could open up possibilities in areas of the country that are currently under employed.  With the possibilities of human-centered automation, these approaches will be increasingly important. I do question if today’s HR organizations are ready for this level of innovation.