7 steps for defining iot products and strategies

Competing for The Digital Future Kick Start Your Digital Strategy and Transformation Program

7 Steps for Defining IoT Products and Strategies

Competing for the Digital Future | Leadership Program


7 Steps for Defining IoT Products and StrategiesCreating breakthrough customer value as part of an intelligent ecosytem

• The impact of IoT?

• Steps to designing IoT products and strategies

1. Outcome Based Design.

2. Profiling Digital Ecosystems

3. Profiling Industry Value Chains

4. Identifying “Always-On Innovation Zones

5. Explore Alternative Business Models

6. Re-Imagine the customer Journey with IoT

7. Define Integration Requirements with Marketing and Operations


The Impact of IoT? How we sense, interact with, and experience our world is being re-architected.

• The Internet of Things offers huge growth opportunities• Success requires more than adding intelligent sensors to product mix– Holistic approach to

• Creation of customer value• Product design• Business models

• Design and strategy context– Continually evolving digital ecosystems


The Impact of IoT? IoT bridges the gap between the digital and physical worlds

• Enables outcome optimization at a scale

– Create, share, combine and analyze huge amounts of data.

– Radically re-engineer processes, jobs, and industry value chains

– Monitor and control simple to complex activities and systems in real time

– Future services and products will do that as part of a larger continually innovated interoperable digital ecosystem.

• Dramatically changes how we need to design, develop, and manage

– Services and products

– Business models

Competing for The Digital Future Kick Start Your Digital Strategy and Transformation Program 5

Additional ResourcesClick below for free slide decks, blogs and videos from our Digital Leadership Program

Online training, materials, and tools and a powerful planning framework dramatically reduce the time you need to organize, present and get buy in for your program

Free 50+ question discussion guide excerpted from our leadership program

Online at

http://www.creatinginsanelygreat.com/competing-for-the-digital-future/an-introduction-to-digital-strategy-and-transformation/


Step 1: Outcome Based DesignThe starting point in IoT design is outcomes and experiences that creates customer value

• Understand high value customer outcomes and success metrics– Breakdown processes and “jobs” involved

• Identify contributing– Organizations and resources– Products, services, and platforms– Data from the physical world that will enable more effective achievement of high

value outcomes and experiences• Example – City Parking:

– Sensors communicate available parking spots to the cloud– Navigation system shows open parking spaces close to destination.


Developing Customer ProfilesProfiling visionary customers and their digital strategies – key to strategy

• How do these customers create value?

• What creates value for them?

• What are the disruptive market scenarios they are investing in?

• How will they harness digital innovation?

• What does your industry currently contribute?

• How will their digital strategy and the market scenarios they see impact that?

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Step 2: Profiling Digital EcosystemsWhen digital devices, services, and data are connected they form digital ecosystems

• Digital Ecosystems:– Sensors– Data / analytics– Standards for interoperability

• Profiling includes identifying:– Emerging technology and digital platforms– Technology and business model trend– Services– Standards and most influential providers

• Example - Intelligent lighting systems:– Ability to incorporate multiple sensors and controllers– Impact on security systems and city infrastructure.


Step 3: Profiling Industry Value ChainsIoT based products and services redefining what the market defines as valuable

• IoT is reshaping industry value chains:– What jobs need to done– How jobs are done– Processes jobs are a part of– Enabling products and services– Companies that provide products and services

• Successful IoT Products and Strategies require understanding– Value chains– Where IoT and IoT data can radically restructure them

• Example – Taxi Services– UBER has had a dramatic impact on the value chain in the Taxi business.– Add IoT enabled autonomous vehicles that drive themselves– Driverless vehicles = Game change


Industry Value ChainsImpact of IoT on industry value chains. Yours and Customers.

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newIndustry Value Chains

How Jobs Are Done


Step 4: Identify “Always-On Innovation ZonesAlways-On Innovation Zones = Strategic growth areas defined by customer outcomes

• Defining Always-On Innovation Zones– Identify specific challenge points/problems that IoT can bring incremental value to.– Define a portfolio of IoT initiatives to explore

• Guide investment through an Always-On process– Integrates emerging technology, customer insight– Evaluation based customer and business value delivered.– Increases probability of developing truly breakthrough IoT solutions

• Example – Agriculture– Always-On Innovation Zone - Optimizing crop yield and ROI from crop– Continually integrating emerging, IOT products, analytics, 3rd party data like weather and soil

conditions, machine data like fuel and speed with optimization algorithms for field planting and harvesting patterns creates a powerful customer outcome focused innovation strategy.


Step: 5 Explore Alternative Business ModelsIoT based products enable and even demand new business models

• Use a business modeling brainstorm tool like business canvas– Quick and effective brainstorming of alternative business models

• Evaluate multiple alternatives models– Product– Product plus basic service– Free product but pay for services– Totally free with reward to customer for using

• Exploring alternatives– heds light on powerful new business models– Helps in designing the product

• Example – Insurance– Alternative business model – provide lower rates to subscribers who agree to have the data from

their car automatically uploaded to the insurance carrier who rewards them for driving safely and in safe areas.


IoT Business Model BrainstormName: Description of value created – outcome delivered

Market Partnerships Market Activities Value Proposition Customer Relationships Customer Segments

Market Resources Channels

Cost Factors Revenue Generators


Step 6: Re-Imagine Customer Journey with IoTIoT products and services will change the customer’s journey with us

• IoT will change how customers:– Discover– Evaluate– Acquire– Use– Obtain service and support, and manage those products and services– Establish and manage relationships with providers

• Create new opportunities and requirements:– Marketing, sales, service and support, operations and product management systems.– Those systems will need to capture and act on product and service use, operating parameters,

faults and failures, the context within which the user is working, and the other resources the product or service is interoperating with.

• Example – Apple Watch– Creates intimate contextual customer insight and delightful customer experience


Re-Imagine the Customer JourneyHow can you use IoT to more effectively engage and create value for customers?

Customer Journey

Status QuoTrigger Point

Explore Options

Evaluate Solutions

Business Case

Internal Buy In Purchase

Deploy Solution

Validate Value

Expand Use Refer

High Value Customer Outcome

Value Creation Opportunity

Engagement with IoT

Data delivered

Data Provided

Supporting Processes

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Step 7 Marketing & Operations RequirementsIOT increases communication and management opportunities and requirements

• Re-vision your marketing and operational systems

– Integral extensions of IoT products and services.

• Objective:

– Find new ways to empower and delight your customers

– Use data generated by the IoT enabled products and services and the ecosystems

– Predict, present and serve up next level capabilities and services at just the right time.

• Example: Smart Phone

– Marketing and operational infrastructure

– Provisioning and managing your profile and services

– IoT enabled products and services will require the same capabilities.


Operational Systems

IoT Impacts Your “Digital Core” RequirementsCustomer interaction, data, interoperability, management, and provisioning

Customer Journey & Engagement

Products & Services Ecosystems

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Additional ResourcesClick below for free slide decks, blogs and videos from our Digital Leadership Program

Online training, materials, and tools and a powerful planning framework dramatically reduce the time you need to organize, present and get buy in for your program

Free 50+ question discussion guide excerpted from our leadership program

Online at

http://www.creatinginsanelygreat.com/competing-for-the-digital-future/an-introduction-to-digital-strategy-and-transformation/


[email protected] ConnorPrincipal, Spice CatalystDirector, Customer Value Creation International (CVCI)

Author:• Creating Insanely Great Customers• Competing for the Digital Future

A Leadership Program in Digital Strategy and Transformation

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