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Copyright © 2016 Connected Methods

eWon FlexThink Conference

Creating Business Value With IoT

2 | Copyright © 2016 Connected Methods

Difference Between Support and Service

sup·port1 : to hold up, prop up, or serve as a foundation for

2 : to maintain in condition, action, or existence

ser·vice1 : Useful labor that does not produce a tangible commodity

2 : Work done for others as an occupation or business


Customer Loyalty

“TheServiceExperiencecanbemoreimportant

thantheSalesexperiencewhenitcomestocustomerloyalty”

“A5percentimprovementincustomerretention

rateswillyielda25to100percentincreasein

profits.”

source:TheLoyaltyEffectbyFrederickReichheld


Recent IoT Survey Results Point to Opportunities


Recent Survey on Challenges and Payoffs of Services

EconomicPotentialServicesareaCostDriver

LackofChannelsResistancefromSalesForceResistancefromCustomers

PricingLackofExperience

OrganizationalReadiness

ManufacturersRatingsofObstaclestoOvercomeWhenExpandingServices

ResponsetoDecreasedMarginforHardware

ProfitMarginforServices

GreaterIncomeStability

AchievingCompetitiveDifferentiation

ResponsetoChangingCustomerNeeds

MeettheNeedsofCustomerstoOutsource

CaptureaLargeShareofValueLifeCycle

ImproveCustomerRelationships

ManufacturersRatingsofBenefitsWhenExpandingServices

Brown,S.W.,A.Gustafsson andL.Witell.“BeyondProducts.”WallStreetJournal.


Future Growth For Product Companies are Driven By “Connected Services”

TraditionalProductDevelopmentCannotKeepUpWithCustomer’sPerformanceNeeds

ConnectedProductsAdditionalprofitscomefromvalue-addedservices

Non-ConnectedProductsProfitscomefromtheproduct/device

Levelofdevice-performancerequiredbyusers

ConnectedMarketplace

Non-ConnectedMarketplace

Transitionpoint

Thedeviceitselfbecomessecondarytothevalueitbringstothecustomer.

Perfo

rmanceNeeds

Time


IoT In ActionCase Studies and Industry Examples


Caterpillar – Reducing Customer Risk & Cost


Industrial Product Company IoT Strategy

4criticalbusinessimperativeswere

identified

Increaseequipmentuptime

Improvecustomersatisfaction/experience

Reducecosts

Increaserevenue

16IoTinitiativeswereidentified,described,

andrankedaccordingtoEaseofImplementationandValueofBenefits

6ofthe16IoTinitiativeswereidentifiedas“High

Priority”

Impactstoproduct,process,people,andtechnologywere

definedforeachofthehighpriorityinitiatives


Directional IoT Transformation Roadmap

IoTAlertingandCallRouting

Year1

EquipmentUptime CustomerSatisfaction/Experience

ReducedCosts

Year2 Year3andBeyond

IoTProgram/PMO

MonitorOperatingEnvironment

2

7

6

10AutomatedDataCollectionforTroubleshooting

InstalledBaseAutomation

1

14

5

Proactive/PredictiveMonitoring

SWFeatureSales

IncreasedRevenue

DataArchitecture4

DeviceID13

15 AnalyticsProgram

3 MeasureableSLAs

PushforHelp9

11 UsageMonitoring

QualityInvestigation12

Real-TimeEventMonitoring16

IoTLicensingCompliance12

Alignswithallbusinessimperatives

8 AutomatedSWDeployment


Proactive Monitoring Results In Increased Uptime

• LaserFailureacrossinstalledbase:• BeforeDBD

• 3½daysofdowntimeand½dayoflostoperatorproductivity• WithDBD

• SystemnotifiesSupportthatthelaserisclosetoEOL• Dispatchscheduleoffhoursforreplacement• 0UnscheduledDowntime!

• SangerInstitute:• BeforeDBD/ProactiveMonitoring– FacilityUptime=92.4%• WithDBD/ProactiveMonitoring– FacilityUptime=99+%

• FilerCrash:• BeforeDBD/ProactiveMonitoring

• TimetoResolution=15– 19Hours• WithDBD

• Diagnosticdataautomaticallysentalongwithcasecreation• Fixisdevelopedandinstalledremotely• TimetoResolution=5- 7Hours

• SlowSystemPerformance:• BeforeDBD/ProactiveMonitoring–TimetoResolution=~5Hours• WithDBD/ProactiveMonitoring–TimetoResolution=15MINUTES


GE Healthcare Drives Mission Criticality

ContinuousMonitoring

RepairsReturns

ServiceProcessMgmtEngine

ConditionBasedMaintenance

RulesBasedExceptionHandling

RemoteDiagnostics

PredictiveAnalytics

Workflow/BusinessRules

IntelligentDataFeed

EnterpriseConnectors

Applications

Firewall

Internet

Reducedoveralldowntimeby40%,increasingrevenueby$100,000/monthper Cath lab

Benefits


Transforming Field Service

Technical Skills

Business Skills

Territory Management

Data Base Skills

Consultative Skills

Customer Sat SkillsPeople Skills


Customer Needs AssessmentTop Business Challenges …

PatientSafety

ProtectingtheSchedule

IncreasedThrough-

Put

CostContainment

HigherQuality

Outcomes


MEDRAD’sTop Business Challenges …

IncreasedCompetition

NeedforDifferentiation

ProductCommoditization

ImprovedServiceDelivery


The “Connected” Services Roadmap

FieldServiceManagementandCRMTools(Siebel/SAP)

GreatProductswith 24x7FieldServiceandTechnicalSupport

Connectivity/IoTTechnology

MarketSegmentedandTieredProgramsthatLeverageIoT

TechnologyEnabledInteractionsand“Connected”Services

WebPortalandSelfHelpTechnology


Results of Executing the Strategy

• Year over year increase in Net Promoter Score

• 10% Increase in Profitability

60

65

70

75

2005

2007

2009

2011

2013

NetPromoterScore

NetPromoterScore


IoT INDUSTRY BEST PRACTICES


Internet of Things Business Models and Maturity Curve

§ Remoteaccessasneeded

§ Status§ SWUpdates§ BasicAlarms/Events-Reactive

§ RemoteDiagnosis

§ Someproactivemonitoring

§ UsageAnalytics

§ AssetManagement

§ EntitlementManagement

§ FeatureManagement

§ Monitorandreportonservices

§ Viewandanalyzeproductdata

§ Leverageusagedatafornewproductenhancements

§ PerformanceGuarantees

§ PayPerUse§ PredictiveService§ VendorManagedSupplies

§ Enterpriseintegration§ 3rd PartyProducts

Access-Centric

Information-Centric

Outcome-Centric


Traditional Product Development Approach

BeyondEarlyMarketing,LowCustomerInteraction,HeavyPlanning

PotentialBusinessPartnersMayEnterlateinthegame

ProductisNotClearlyLinkedtoCustomerPreferences

Longdevelopmentefforttowardasubstantialproductreleaseincorporatingalargesetoffeatures.

CustomerDesire

ProductReleases

AdvancedResearch

v1 v2


Iterative Approach To IoT Service Creation

MarketExperience

CustomerExperience&Validation

IntroductionofBlueSkyThinking

HardeningNewFeaturesfornextrelease

DeliverValue“Early”

ExpandPartners

Va Vb Vc

IntroduceVariousPartners

ProductRelease

v1

BusinessPlanning

CustomerDesire

ProductReleases

AdvancedResearch

ProductVersions

NEWAPPROACHTO

SERVICEDEVELOPMENT

Involvingcustomersearlyintheservicedesignprocessreducesriskandprovidesafastertime-to-

marketthatcreatesrealvalue


Key Success Factors for Product to Service Transformation

Ongoing supportfromseniormanagement

12.8%

20.8%

64.8%

CommunicationofobjectivesInternalcapabilitytorunandmanageprojects

41.6%

Planningandresultsmonitoring 8.0%

FlexibleandscalableITsystems 7.2%

Rolemodelofleadershipinembracingchange 5.6%

Alignmentwithoverallstrategy

22.4%

Sufficientandadequateresourceallocation

27.2%

Buy-infromemployees 32.0%

Ambitious,butrealistictransformationplanLeadershipcapabilitiesinmanagementteam

Collaborationacrossfunctions

24.8%

21.6%

KeySuccessFactors

Source:TheEconomistIntelligenceUnit


We Are Devoted To Helping You Grow

Jack LevinPresidentConnected Methods, [email protected]

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