A business model for the Internet of Things for every CXO
This post originally appeared on the Sogeti Labs blog
What started with a marketing buzzword has grown out to a serious question for a lot of CXO’s: “What is the Internet of Things, and how can ‘I’ benefit from it?”
Studies from Cisco, IBM, Microsoft, McKinsey, Gartner, Forrester and other companies are showing us a tremendous growth in several areas in, what we call, the Internet of Things/ the Internet of Everything. The amount of connected devices is only one of the examples which we can use to explain how fast this technology is growing. Consumers are embracing these so called wearable technology in almost every aspect of day life. Small start-ups funded by the crowd are offering all kinds of connected devices on a massive scale.
For companies there is just one question. How can I step in to this market to enhance my profit and gain market share? How can I define a Business model which give me the opportunity to increase my competitive advantage?
Are you familiar with the Business Model Canvas? This canvas is a management tool where you can document existing models or develop new business. Where Alex Osterwalder invented the Business Model Canvas in 2008, the Claropartners developed a business model template for the Internet of Things.
“We have mapped out the emerging business landscape in a dynamic, online tool which show the vastness, variety and scope of the Internet of Things, with a focus on new initiatives and start-ups. It provides an overview of current activity (350+ initiatives mapped), hotspots and areas of growth across industries, and we use it as a starting point for identification of new opportunity spaces for businesses looking to take a fundamental role in the market.”
What I like about the IoT canvas is that they split the model in two streams, the physical and the digital stream. And, is that not what the Internet of Things is? Bringing the physical to the digital to create connections and insights we never had before. Connecting the unconnected. But also two streams, as the core to deliver the value proposition.
Keep in mind that – the same as with Osterwalder his model – everything is about the Value proposition. Customers do not buy solutions you and your company like. They prefer solution what benefits them. For that reason, determine what value you deliver to your customer and to your end-user first. What will your customer experience when they buy your product or service? For that reason I will rephrase the CXO question from the beginning…
“What is the Internet of Things, and how can my customers & end-users benefit from it?”
Give it a try! Click here to download the Business Model Canvas for the Internet of Things.