How to improve business processes with Internet of Things (IoT)?

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Internet of Things (IoT) is a trending topic these days, but you might be wondering how companies should take advantage on new technological improvements, and avoid to get lost trying to implement IoT for every single step within the business processes.

We have been developing IoT projects for some time now and have built some solutions and prototypes for our customers, we have done some analysis on how to improve business processes with tech-wise operations using IoT. But have found sometimes immerse on huge opportunities that takes more time or resources to develop, so cost-benefit might bend the balance on not getting the expected result at the first time.

IoT uses are to automate process, gather valuable information, extend business functions, trigger rules, source predictive analytics and big data, among other useful objectives.

Here are some recommendations on implementing IoT business processes in your companies:

1. To define business process to improve and identify the problem you want to solve. Make sure to bring a solution to few problems at once, don’t try to solve every single problem within your company. Lean principles and Design Thinking methodology can help to identify main problems to avoid losing valuable time.


2. Use an end-to-end approach. Even though you are trying to solve a single issue, map end-to-end process to make sure you are not missing anything on your analysis. Processes may involve several operational areas; they touch more than one ecosystem (Machinery, Devices, Customers, Vendors, ERP, CRM, etc.); they are driven by a bunch of people; and for sure they don’t stop where you believe they do. Actually IoT could be used for many purposes, just find the right one for the process improvement.


3. Make AGILE design and start with POC (proof of concept) prototyping. Do not try to build a solution 100% ready at the first iteration, it’s better to start with a prototype to be perfectible within 2 or 3 design iterations maximum, then go for construction with volume, security, profiles and the rest of “best practices” for architecture considerations. Make quick wins instead of trying to win the war at the very first step, that will not happen at the beginning of the innovation process. You will need to find perfect balance between short strings, design iterations, solution deepness and project length, that in itself is a great challenge you will face on these projects.


4. Get on board the right people, better if you keep it low but with the best knowledge. Always a very trite phrase, but you need to make sure the right team is placed to build an IoT solution, so consider business processes, technical needs, architecture compliance and that’s it. The Leader must provide direction to the team to obtain goals on short strings and drive the boat to its final destiny, finally sponsorship must be involved at all IoT project stages.


5. Be persistent but acknowledgeable to failure. This is not a regular, long and high-cost IT project, persistency is a quality everybody should embrace, but as lessons are learned and challenges are raised, the team may change directions to look forward into final goals, do not be discouraged if this happens. Short strings will allow you to make changes to adjust to achieve results without bigger impacts.


6. Disruption could be there, but don’t go crazy about it. IoT does not mean disruption at all costs, most of the companies that hear about innovation with IoT think on disruptive paths, the thing is you can get lost looking for disruption that does not exist. You better be prepared to identify it when happens, but don’t waste valuable time to make disruptive changes or improvements if is not part of your final destination. Companies looking for disruption should be analyzing different ways to get there, but they should not just pigeonhole it with the IoT path.


7. Do not connect things to internet without a purpose. Connecting things to internet without a purpose is a waste of time and money, think on real needs and how to solve them by not connecting whatever is on your way. This is a really difficult task while technology is at reach and costs have been dropping. The way to define this is set by operational, analytical and business purposes rather than technological accessibility, design thinking should be oriented by business process not by tech drivers.


8. Make solutions simple, scalable and modular so they are able to support growth into volume and additional functions. When design iterations happen and functionality needs are defined, you will need to create a solid basis to increase functions, data processing, users access, security, etc. This should not be contradictory with the AGILE approach since you are creating a modular and scalable solution, furthermore be savvy when designing and building to avoid slowing down iterations and development with a rigid structure on the solution.


9. One of the most important for IoT projects is to define a business plan involved with the IoT project but don't expect to fulfill it with the exact amounts and numbers, also huge investments need to be avoided. Better keep the budget down to strings and not big projects that can discourage the sponsors who are providing the funds for improvements, please consider right KPI’s and fine measures to validate those improvements.


10. Try to choose right technology and do not hesitate to change it when needed, IoT could be delivered with all kind of new tools out in the market, on defining the right one from the beginning will challenge your skills. Even though your decision was incorrect by the learning process, if changes are needed, you should make them and learn from it.

SAP is offering a set of Internet of Things (IoT) connections within SAP Cloud Platform (previously named HCP) and SAP Leonardo. It is hard to imagine that every company will define the same things to connect to, so that might not be packaged, but what is really interesting is that you could have IoT connectivity within same Architecture (SAP). IoT solutions can include SOA, BPM integration with cloud or on-premise capabilities that allows to connect with different protocols and devices, also rules modeling, on-memory database processing power with HANA, several computing language programming, and analytical capabilities to go through large information volumes. So when mapping end-to-end processes to improve with IoT, think on connecting different devices to several systems, where you can pull triggers, define alerts, set rules, analyze data, automate steps and make operations simpler according with business needs.