A common analysis from IT departments is a restatement of the 80:20 rule. That 80% of the costs of the IT budget are caught up with running and maintaining the IT legacy and only 20% is available for new services that will drive through the transformation anticipated by the business. This has the effect of slowing innovation adoption and adding to the frustration of organisations that are seeking to engage their customers in new ways or redefine their business model. It also contributes to the creation of a shadow IT organisation, which is discussed in another CGI blog.
Internet of Things (IoT) technologies are recognised to be a key contributor to enable business transformation. Collecting and then analysing data from assets can deliver operational efficiency, improved employee and customer experiences and deliver a range of innovative services. The potential value to an organisation from such process improvements are substantial and underpin the enormous revenue impacts that analysts have associated with IoT adoption
So why is IoT adoption progressing on a gradual rather than exponential rate? Well in part it’s to do with the 80:20 rule and the associated budget realities which can constrain investment. As CGI we conduct an annual review of trends amongst our client base. One of the conclusions illustrates this point and is shown below. The information is based on almost 1000 interviews:
However, there is no need for this to be the case. Cloud based technologies such as those that underpin IoT make it possible to start with smaller projects which can then scale to larger deployments. These don’t need to be separate from existing legacy solutions in fact integration with legacy applications either on-site or other cloud environments makes a lot of sense. The new business insights that can be obtained can bring value and start to educate the business about the potential focus for new business orientated IT investments. Such an approach not only keeps the business moving forward but starts a different approach to how IT is deployed. Engaging the business during the process through seeing screens and visualisations and not simply being involved in a dry requirement gathering exercise ensures project outcomes are more successful, this in turn increases confidence in IT investments. So using the 20% budget you have available to start transforming your business is possible, so why not start that transformation today.