The Services Research Company™
HfS Blueprint Report
Internet of Things (IoT) Services
Excerpt for Accenture
October 2016
Oliver Marks
VP Research Digital & IoT
[email protected]
Table of Contents
TOPIC
PAGE
ExecutiveSummary
2
Key MarketDynamics
10
Research Methodology
21
ServiceProviderAnalysis
26
Market DirectionandRecommendations
33
AbouttheAuthorandHfSResearch
39
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Executive Summary
Introduction to the HfS Blueprint Report:
Internet of Things (IoT) Services
n TheInternetofThings(IoT)ServicesHfSBlueprintReportreviewstheemergingvaluechainof
servicesdevelopingfromprovidersthatareaddressingthispotentiallyhugeandtransformative
technology.
n Unlikeotherquadrantsandmatrices,theHfSBlueprintidentifiesrelevantdifferentialsbetween
serviceprovidersacrossanumberoffacetsintwomaincategories:innovationandexecution.
HfSemphasizestheemergingnatureoftheIoT,with55%ofthetotalBlueprintscoringlinkedto
innovation-basedevaluationcriteria.
n TheHfSBlueprintincludesprofilesandassessmentsof17serviceprovidersofIoTServices.
n Wedisplayourassessmentsofthe17serviceprovidersontheHfSBlueprintGrid.
n TheHfSBlueprintGridrecognizesprovidersinthefollowingcategories:HighPotentials—up-and-
comingserviceprovidersthatscoredhigheroninnovationcriteriathanonexecutioncriteriaas
theybuildtheirpractices.ExecutionPowerhouses—established,high-executionserviceproviders
thathavebuilteffectivedeliveryoperationsbutneedtoinnovatetheircapabilitiesandofferings
further.HighPerformers—serviceproviderswithstrongcombinedinnovationandexecution
performance.Winner’sCircle—serviceproviderswiththehighestoverallperformance.
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HfS Definition of Internet of Things (IoT) Services
HfSDefinesIoTServicesas:
1. Datastreamstoandfromconnectedphysicaldevices
2. Deliveryofdatafromandtocentralizedrepositories
bythesephysicaldevicesforadditionalinteractions.
Note:Thedevicesdeliveringthedatamayormaynotcreatethedatathemselvesandmayormaynotprocessthe
informationbeforedeliveringit.Thedevicescanbeintelligentordumb—rangingfromanitemtaggedwithanRFID
chipthatiscodedwithauniqueidentifiertoalargesophisticatedheavyindustrialmachinewithsensorsthat
monitorandcontrolallaspectsofoperation,output,andhealth.Further,communicationofdatamaybedonevia
variouscombinationsofwiredand/orwirelessnetworks.Thesenetworkscanbeeitheropenorprivate,andwhile
thiscommunicationisoftencarriedoutviaIPprotocol,itisnotarequirement.Asaresult,theIoTincludesabroad
setofactivities,someofwhichhavebeenusedfordecadesinindustrialcontrol.
HfSdefinesIoTServicesasdigitalstrategyandtacticalexecutiontosolvebusinessproblems,
increaseoperationalefficiencies,and/orcreatenewmarketsbyleveragingdatatoandfrom
connectedphysicaldevices(“things”)andthedigitalcore.Thedigitalcoreistypicallyablendof
legacyITinfrastructureandmoderndigitaltoolsandtechnologies.
IoTServicesdesign,deploy,andenableinteroperabilitywithconnected“things”asanaspectofan
overarchingapproachtosolvingbusinessproblemsforclientsandpartners,rangingfrominnovation,
conception,andexecutionthroughtooperationalsupportandmaintenance.
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Key Highlights: The State of the IoT Services Market
n TherearetwodistinctIoTdevelopmentareas: WheretheIndustrialInternetusageofIoThasastrong,
maturestandardsandinteroperabilityservicesculturerootedinITworkflowlogic,theIoTwillbe
emerging,mutating,andevolvingfortheforeseeablefuture,makingithardforservicescompaniesof
alltypestocoalesceteamsaroundrepeatableprocesses.
n IoTServices requiresmultipleskillsetsworkingtogether:TheIoTbridgesmultiplecompetencies
currentlyhousedwithindifferentserviceproviderpracticelines.Business/digitalstrategy,
telecom/mobility,cloud,userexperience,engineering,analytics,andsecurityareblendedinagile
teamsforclientsafterstrategicintentsandgoalsaredefined.Forbuyers,executionsecurityand
interoperabilitycompetenciesaretablestakesforconsideration.Theabilityofparticipantsto
understandthebusinessvalueofexecutioniscriticalforsuccess.
n IoTisaningredientofbroaderdigitalinitiatives: Agreatdealofcurrentactivityfocusesonstrategy,
innovation,andplanning,essentialbeforefocusingonexecution.Theabilitytogenerateandgather
dataonanever-broaderrangeofphysicalassetsandinteractionswillyieldvalueonlyifactionable
insightsyieldclearbusinessvalue.Servicesprovidersareexpectedtoparticipateinthesestrategic
stages.
n IoTopportunitiesrequirecompetitorstocollaborate:Digitalplatformsthatintegratedatafrom
multiplesourcesaresoughtaftertoyieldthegreatestandbroadestcontiguousvalues.IoTpoint
solutionsareoflittleusetobusinessiftheycannotinteroperate,unlesstheysolveaveryspecificpain
point.
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Key Highlights: The State of the IoT Services Market
(continued)
n Thedigitaleconomyisforcingchangeonlegacybusinesses:ThereisonlysofarwecanpushlegacyIT
asaplatformforthescaleofdataandinformationflowsenabledbytheIoTandotherinitiatives.Atthe
sametime,therearehugebusinesspressuresfromnewerdigitalcompetitors,forcingmature
businessestolookhardatre-platformingtoaccommodatetheIoTandotherdigitaldataflows.
n Thesecretive,competitivenatureofIoTplanningobscuresmarketperceptions:Althoughindustrial
efficienciescasehistoriesarecommonplace,fewofthevendorsanalyzedinthisBlueprintcouldpublicly
discussthemoreinnovativeclientworktheywereworkingon.ThistendstoskewperceptionoftheIoT
toindustrialsensordataflowsandheavilymarketedservicesandtools.Proofsofconceptandpilot
projectsarealsooftenheavilypublicizedtogaintractioninthemarketplaceandjustifybudgeting
decisions,whereactualwell-fundedinitiativestendtobekeptundertightwraps.
n Securityfoundations:Acrosstherapidlyevolvingdigitallandscape,end-to-endsecurityiscriticalandis
akeyvaluepropositionforallserviceproviderpartnerships.TheIoT’schaoticevolutioncontinuestobe
fullofpotentiallyexploitablepiecemealcomponentsthatcouldbedangerousplatformpointsofentry
forhackers.Thischallengeslowsdevelopmentbutisessentialforresponsibleinnovationandbusiness
strategyrollout.
n Accessibleandactionabledataviaplug-and-play digitalservices:InnovativeIoTbusinessusesarean
excellentexampleofthe“borndigital”next-generationtechnologiesbeingleveragedtodrivemodern
businessthinking.
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IoT Services Value Chain
IoTServicesarethosethatdesign,create,andmanageapathwayforthephysicalworldtoenterthe
As-a-ServiceEconomybycreatingabridgebetweenhardgoods(andservices)anddigital
infrastructure.
IoTCONSULTING
• Strategicplanningand
businesscase
development
• Governancestrategy
• IoTtechnology
roadmap(reference
architecture)
• Securitystrategy
• Datatransportand
telecomcostconsulting
IoT ENABLEMENT
• Productengineering
• Sensordevelopment
Softwareengineering
Embeddedtech
Devicesecurity
CustomAppDev
(dashboards,
visualization,etc.)
• Physicalprototypingof
“things”
•
•
•
•
IoT CONNECTIVITY
• Networkengineering
• Network
implementation
• Networksecurity
• Telecom
IoT INTEGRATION
IoT MANAGEMENT
• Databasedesignand
build
• Devicemanagement
• Cloudhosting
• Analytics
Implementation
• Systemintegration
• Application
modernization
• Networkmanagement
• Datasecurity
• Security
IoTServices,however,donotincludethefollowingactivitieswhenconductedasastandaloneservice:deployingoroperating analytics,
implementingorrunningadatarepository, developingordeliveringanetwork, andcreatingormaintainingaphysicaldevicewiththe
capacitytocreateand/orcommunicatedata.ThosestandaloneactivitieswouldbeclassifiedasAnalytics,BigData,Network
Implementation,andProductEngineeringServices,respectively.
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IoT Service Value Chain by Overall Current
Supplier Maturity
IoTCONSULTING
IoTENABLEMENT
IoTCONNECTIVITY
IoTINTEGRATION
IoTMANAGEMENT
Strategic Planning
andBusinessCase
Development
Product
Engineering
Network
Engineering
Database Design
andBuild
Device
Management
Governance
Strategy
Sensor
Development
Network
Implementation
Analytics Implementation
Cloud
Hosting
IoTTechnology
Roadmap(Reference
Architecture)
Software
Engineering
Network
Security
System
Integration
Network
Management
CustomDevelopment
Embedded
Technology
Application
Modernization
Data
Security
DesignThinking
Device
Security
Mature
Competitivemarket withexamplesofserviceofferingsandcustomercasestudiesfromalargenumberofserviceproviders
Nascent
Marketindevelopment withlimitedexamplesofserviceofferingsandevidence ofactivities
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State of the Market: Service Providers
n As-a-ServiceWinnersareserviceprovidersthatarebeing
entrepreneurialalongsideclientsandinnovatinginboth
IndustrialInternetandIoTactivities,buildingnewmarkets,
paradigms,digitalsystems, anddataflowsaroundabreadth
ofdifferenttypesofconnecteddevices.
Accenture,Atos,Cognizant,EPAM,Harman,IBM,HCL,
TCS,TechMahindra
n TheHighPerformers allexecutewellaroundolder
IndustrialM2Mmodels,andareexploringandinvestingin
newerIoT.Evolvingdemonstrationofmoretractionwith
clientsindefininganddeliveringatscaleagainstbusiness
outcomesandco-innovation.
Dell,Infosys,NTTDATA,NIITTechnologies,Syntel,Tieto
n ExecutionPowerhouses Thiscategoryhasdeeppedigrees
andcompetenciesinIndustrialInternetworkataglobal
scale,withtremendousresourcesbutislackinginmodern
IoTinnovationandentrepreneurship.
Genpact,Luxoft
n VirtusaPolarishasHighPotential withpost-mergergrowth
showingpromisethroughrapidmaturationasamodernIoT
player.
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AS-A-SERVICEECONOMY
Useofoperatingmodels,enabling
technologies,andtalenttodrivebusiness
outcomesthroughoutsourcing.Thefocus
isonwhatmatterstotheendconsumer.
HfSusestheword“economy”todescribe
thenextphaseofoutsourcingasanew
wayofengagingandmanagingresources
todeliverservices.
The8IdealsoftheAs-a-ServiceEconomy:
1.
2.
3.
4.
5.
6.
7.
8.
Write OffLegacy
DesignThinking
CollaborativeEngagement
BrokersofCapability
IntelligentAutomation
AccessibleandActionableData
Holistic Security
Plug-and-PlayDigitalServices
Source:BewareoftheSmoke:YourPlatformIsBurning
byHfSResearch,2015
Key Market Dynamics
The Rapidly Changing Face of Business Strategy, Associated
Technologies and the Services that Are Sought After
Inourcurrenthigh-stakesbusinessera,whendigitalischangingallaspectsofdailylivesandbusiness
models,theInternetofThings(IoT)stilllargelyhastwodimensions.
TheIndustrialInternetoriginatedintheearlydaysofconnectivityandhasevolvedtowhat
Europeansnamed“Industry4.0”—arobustsetofstandards,technologies,andgovernancemodels
forsensorfeedbackfromequipmentandbuildingstomonitoroperationalefficienciesandhealth.
WheretheIndustrialInternet’srootsinthelastcenturylargelyassociateitwiththatera’senterprise
ITlogicandworkflows,theIoThasexplodedontotheworldstageinatsunamiofhyperboleandred
herrings,asistypicalwithemergenttrendsandtechnologies.
TheIoTisfundamentallyanattributeofthedigitaltoolkit(mobility,cloud,bots,dataflows,and
analytics,humancollaborationandexperiences,security,payments,governance),andasan
ingredientindigitalbusinessplanshasvaryinglevelsofimportancedependingonbusinessgoalsand
needs.
WheretheIndustrialInternetisnowpartofthefabricofourlivesandthebedrockfornewer
incrementaldevelopments,suchassmartcitiesandcars,IoTbusinessmodelsareevolvingveryfast
forcommercialvalueapplications,bothasproductsandascountlesstuck-instoexistinginformation
flowsandprocesses.
Atangibleexampleisthespeedwithwhichdronesemergedandbecameahugeconsumermarket,
aninvaluablevisualinspectiontool,andanoriginatorofgigabytesofdatathatneedtobeprocessed
andstored.
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The Rapidly Changing Face of Business Strategy, Associated
Technologies and the Services that Are Sought After, continued
Dronesareoneexampleofthespeedatwhichdatacreation“things”andtoolsemergeand
becomepartofdailylife—anda$127billionmarketby2020accordingtoPwCdata.
LIDAR(aradar-likedetectionsystemthat“sees”usinglightfromlasers)willguidethenext
generationsofdronesawayfrompowerlinesandotherobjects,allowingformanymoreautomatic
usemodels.Thecommercialusesforthesetoolsandthedatatheycapturearewidespread,partof
countlessbusinessmodelsandleveragedineffortstocreateautonomousvehicles.
Currently,theIoTisanevolvingmassofcompetingstandards,security
concerns,andinteroperabilityissues,withtransportationviamobile
spectrum/G5,low-powerwideareanetworks,andsensortechnologiesalso
atvaryingemergentstagesofevolution.
Noneofthelegacyplayersinbusiness,IT,marketing,andlegalconsultinghavestrongbroadskillsets
indigitalstrategicandtacticalthinking,andthereisavacuumforcrediblepartnerstobusiness.A
broadmarketshiftfocusedondigitalinnovationandexecutioniscreatinganewgenerationof
trustedpartners,while someofthelegacythinkingplayerswillloserelevanceorbepushedto
commodityproviderstatus.
ThisreportfocusesoninnovationandexecutioncompetenciesaroundtheIoTwithinthebroader
contextofdigitaldemands,strategies,andtechnicalexecutionsophistication.
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Journey to the As-a-Service Economy
§ MovingintotheAs-a-ServiceEconomymeanschangingthenatureandfocusofengagementamong
enterprisebuyers,serviceproviders,andadvisors.
§ “As-a-Service”unleashespeopletalenttodrivenewvaluethroughsmartercombinationsoftalentand
technologyfocusedonbusinessresultsbeyondcostreduction.
FixedAssetsLeveragedAssets
7
Holistic
Security
CHANGEMGMT
Ideals
3
Brokersof
Capability
1
WriteOff
Legacy
LEGACY
ECONOMY
©2016HfSResearchLtd. ExcerptforAccenture
2
Design
Thinking
5
Intelligent
Automation
4
Collaborative
Engagement
6
Accessible
and
Actionable
Data
AS-A-SERVICE
8
Plug-andPlayDigital
Services
ECONOMY
SOLUTION
Ideals
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IoT As-a-Service Economy: Ideal Provider Attributes
HfSusestheword“economy”toemphasizethattheemergingnextphaseofoutsourcingisamore
flexible,outcome-focusedwayofengagingandmanagingresourcestodeliverservices.Operating
intheAs-a-ServiceEconomymeansarchitectinguseofincreasinglymatureoperatingmodels,
enablingtechnologiesandtalenttodrivetargetedbusinessoutcomes.Thefocusisonvaluetothe
consumer.
II.EMPOWERINGTALENT
TOMAKEITALL
POSSIBLE
I.THEOPTIMUM
OPERATINGMODEL
Outsourcing|SharedServices
GBS|BPaaS/SaaS/IaaS|
Crowdsourcing
TOOLS/INFRASTRUCTURE
IV.TECHNOLOGY
TOAUGMENT
KNOWLEDGELABOR
DigitizationandRobotic
Automation|Analytics|Mobility
|SocialMedia|Cognitive
Computing
©2016HfSResearchLtd. ExcerptforAccenture
AS-A-SERVICE
ECONOMY
Agility|Collaboration
One-to-Many|
OutcomeFocus
Plug-and-PlayServices
CapabilitiesoverSkills|
DefiningOutcomes|
Creativity|DataScience
GOVERNANCE
III.ABURNING
PLATFORMFORCHANGE
GlobalizationofLabor|
High-GrowthEmergingMarkets|
DisruptiveBusinessModels|
Consumerization
IoT Service Provider Innovation and Execution Journey
Buyersshouldbeawareserviceprovidershaveverydifferentinnovationandexecution
strengthsandweaknessesacrossIoTandIndustry4.0strategic,tactical,andtechnical
skillsets,anddifferenttechnologyplatformpartnerallegiances.
Innovation
InnovationoutsideIndustrialInternetmodels
connectingdatatotherestofthebusiness
andpartnerecosphere
Examples:Real-timedatafromflowtoandfrom
manufacturing,servicesinconnected“one
connecteddevicesoffice”environment
- Consumermanufacturingofsmartproducts
- Smartvehicles,equipmentwithstrongsupport,
self-healingattributes
LEGACY
ECONOMY
Fullyconnectedenterprise
withIoTattributesfeedingdata
toandfroma‘digitalcore’
AS-A-SERVICE
ECONOMY
Examples:Fullyintegrateddigitalbusinessentitywith
globalconnectivity,processes, andcustomerrelationships
- Amazon
- AppleComputer
ManyCPGfirms
- Fintechfirms
15-year-oldIndustrialInternet
Localsensordatafromdevices
EvolutionoftheIndustrialInternet
toIndustry4.0
Examples:Legacyserialportera
industrialcontrolmechanisms
Limitedconnectivityanddataflows
- Oil&Gas
- Manufacturing
- Olderheaviertechnologies
Examples:Smartfactoriesandheavyequipmentwith
“localonly” dataflows.MultipleIoTpointsolutions.
Muchgreaterconnectivity,moremodernrobotic
equipment
- Oil&Gas
- Manufacturing
- Modernheavytechnologies
©2016HfSResearchLtd. ExcerptforAccenture
Execution
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IoT Innovation and Execution Data Flow Ideals
The IoTflowstoCoreDigitalDataflowsfromsmartobjectsintotheircontrolling
organization’sdigital“backbone”core,whereitisanalyzed,distributed,androutedto
relevantsystemsandpeople
Security
AS-A-SERVICE
ECONOMY
Desiredbusiness
Outcomes,valuetocustomer
DataLake
LegacyIT
DigitalCore
Innovation
Real-timeintelligence,Analytics
Otherdigitalattributes
InternetofThings
IndustrialInternet
LEGACY
ECONOMY
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Execution
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The Eight Ideals of the Broader As-a-Service Economy
LEGACYOUTSOURCING
Intelligent
Simplification
AS-A-SERVICEECONOMY
Legacytechnologyinvestments thatlimitagility
andcreate massesofexceptionsaddressed
throughaddinginternalandexternalFTEs
1.
WriteOff Legacy
Usingplatform-basedsolutions,DevOps,andAPI
ecosystemsformoreagile,lessexceptionorientedsystems
Resolving problemsbylookingfirstattheprocess
asthesourceofthesolution
2.
Design Thinking
Understandingthebusinesscontextto
reimagineprocessesalignedwithmeetingclient
needs
3.
Brokers ofCapability
Orientinggovernance tosourceexpertisefrom
allavailablesources,bothinternallyand
externally,toaddresscapabilitygaps
4.
Collaborative Engagement
Ensuring relationshipsarecontractedtodrive
sustainedexpertiseanddefinedoutcomes
Focusinggovernancestaffonmanaging tothe
letterofthecontractandthedecimalpointsof
servicelevels
Evaluating relationshipsonbaselines ofcost,
effort,andlabor
Operatingfragmented processesacrossmultiple
technologieswithsignificantmanual
interventions
5.
Intelligent Automation
Performing ad-hocanalysisonunstructureddata
withlittleintegrationorbusinesscontext
6.
Actionable andAccessibleData
Respondingwith post-event fixes;littlefocuson
end-to-endprocessvaluechains
7.
Holistic Security
Proactivelymanagingdigitaldataacrossthe
servicechainofpeople,systems,andprocesses
8.
Plug-and-PlayDigital BusinessServices
Plugginginto“readytogo”business outcome–
focused, people,process,andtechnology
solutionswithsecuritymeasures
Undertakingcomplex,painfultechnology
transitionstoreachsteadystate
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Using ofautomationandcognitivecomputingto
blendanalytics,talent,andtechnology
Applyinganalyticsmodels,techniques,and
insightsfrombigdatainrealtime
How IoT Services Play in the As-a-Service Economy
AS-A-SERVICE
IDEALDEFINITION
IDEAL
EXAMPLE
WriteOffLegacy
Usingplatform-basedsolutions,DevOps,andAPI
ecosystemsformoreagile,lessexceptionorientedsystems
Pullingrelevant dataflows fromring-fencedlegacysystemstocontributetothe
digitalcoreinordertodrivemodernbusinessmodels
DesignThinking
Understandingthebusinesscontexttoreimagine
processesalignedwithmeetingclientneeds
IdentifyingbusinessmodelsthatleverageIoTattributes todrivenewmarketsand
costsavings
Brokers of
Capability
Orientinggovernance tosourceexpertisefromall
availablesources,bothinternallyandexternally,
toaddresscapabilitygaps
AssemblingfitforpurposeAs-a-Servicedigitalplatformframeworksto enable
modernbusinessdataflowstoandfromIoTcomponents
Collaborative
Engagement
Ensuring relationshipsarecontractedtodrive
sustainedexpertiseanddefinedoutcomes
TheIoT contributesstructureddatatounstructuredcollaborativeframeworks
acrossbroadecospheresaroundbusinessoutcomes
Accessibleand
ActionableData
Applyinganalyticsmodels,techniques,and
insightsfrombigdatainrealtime
TheIoTprovidesanewlevelanddepthofdataflowsthatrequireasophisticated
As-a-Service cloudinfrastructurethatenablesreal-timeactionableintelligence
HolisticSecurity
Proactivelymanagingdigitaldataacrossthe
servicechainofpeople,systems,andprocesses
For theIoT,securingdatawithinsophisticatednetworksiscriticaltosuccess
Plug-and-Play
DigitalBusiness
Services
Plugginginto“readytogo”business outcome–
focused, people,process,andsolutionswith
securitymeasures
Ecosphere thatrunsonan agiledigitalcorethatallowsandaccommodatesrapid
technologychangesandenablesdataflowincreasesandrerouting
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IoT Solution Examples Across Verticals
INDUSTRY VERTICALS
EXAMPLES
Aerospace
ConnectedAerospace,Connected RepairSolutions
Automotive&Transportation
ConnectedCar,Insurance Telematics,FleetManagement,ConnectedShip,InteractiveGeospatialSolution,
ConnectedEVStations,PredictiveAnalyticstoReduceMaintenanceandWarrantyCosts
Manufacturing
ConnectedAssetManagement,ConnectedWorkers,RemoteDiagnosticand Predictive Maintenancefor
IndustrialMachines,StolenAssetRetrieval,TransparentSupplyChain,ConnectedShopfloor
Buildings
ConnectedHome,SmartEnergy,ConnectedBuilding,ConnectedSecurity
Agriculture
PrecisionFarming,FarmtoFork
Consumer Electronics
SmartWearables,Subscription EnablementPlatform,AuthenticationApplicationsforWearables
Urban Infrastructure
Smart Parking,SmartLight,SmartBin,SmartWaste,DigitalUndergroundMapping,Infrastructure Monitoring,
BridgeMonitoring
Healthcare&LifeSciences
ConnectedHealthcare,HealthFacilityWayFinding, VirtualCarePlatform,PatientEngagementPlatform,
ConnectedPatient,EmergencyManagement
Oil&Gas
DigitalOilField,SmartDrilling,SmartOilTransportation,Solarand WindPowerMonitoring
Utilities
SmartGrid,SmartMetering,ConnectedPowerPlant,ConnectedSolarFarm,ConnectedWindFarm
Mining&Resources
ConnectedMines,Connected SupplyChain
BFSI
Cryptocurrency,BlockChainAssetManagement,BeaconsforCommerce
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IoT Solution Examples by Verticals: Innovation/Entrepreneurial vs. Execution
Innovative/Entrepreneurial
UsingDesignThinking, broaderbusinessstrategytodrivenewideasandmarkets
Execution
Increasedfocus onIndustry4.0controlsystems,sensor,anddataflowtechnicalevolution
INDUSTRY VERTICALS
EXAMPLES
Aerospace
ConnectedAerospace,Connected RepairSolutions
Automotive&Transportation
ConnectedCar,Insurance Telematics,FleetManagement,ConnectedShip,InteractiveGeospatial
Solution,ConnectedEVStations,PredictiveAnalyticstoReduceMaintenanceandWarrantyCosts
Manufacturing
ConnectedAssetManagement,ConnectedWorkers,RemoteDiagnosticand Predictive Maintenancefor
IndustrialMachines,StolenAssetRetrieval,TransparentSupplyChain,ConnectedShopfloor
Buildings
ConnectedHome,SmartEnergy,ConnectedBuilding,ConnectedSecurity
Agriculture
PrecisionFarming,FarmtoFork
Consumer Electronics
SmartWearables,Subscription EnablementPlatform,AuthenticationApplicationsforWearables
Urban Infrastructure
Smart Parking,SmartLight,SmartBin,SmartWaste,DigitalUndergroundMapping,Infrastructure
Monitoring,BridgeMonitoring
Healthcare&LifeSciences
ConnectedHealthcare,HealthFacilityWayFinding, VirtualCarePlatform,PatientEngagementPlatform,
ConnectedPatient,EmergencyManagement
Oil&Gas
DigitalOilField,SmartDrilling,SmartOilTransportation,Solarand WindPowerMonitoring
Utilities
SmartGrid,SmartMetering,ConnectedPowerPlant,ConnectedSolarFarm,ConnectedWindFarm
Mining&Resources
ConnectedMines,Connected SupplyChain
Banking, FinancialServices,
Insurance
Cryptocurrency,BlockChainAssetManagement,BeaconsforCommerce
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Research Methodology
Research Methodology
DataSummary
ThisReportIsBasedOn:
n Morethan1,080datapointswerecollectedfrommorethan56IoT
Servicescontracts,covering18majorserviceproviders.Therewere
others(suchasHPandCapgemini)whoseIoTserviceofferingsare
stillevolvingandwerenotyetinapositiontobeincludedbuton
whichwewillreportlater.
n DatawascollectedinQ2-Q32016,coveringbuyers,providers,and
advisors/influencersofIoTServices.
ParticipatingServiceProviders
§ TalesfromtheTrenches:Interviews
withbuyerswhohaveevaluated
serviceprovidersandexperienced
theirservices.Somecontactswere
providedbyserviceproviders,and
otherswereinterviewsconducted
withHfSExecutiveCouncilmembers
andparticipantsinourextensive
marketresearch.
§ Sell-SideExecutiveBriefings:
Structureddiscussionswithservice
providersregardingtheirvision,
strategy,capability,andexamplesof
innovationandexecution.
§ PubliclyAvailableInformation:
Thoughtleadership,investoranalyst
materials,websiteinformation,
presentationsgivenbysenior
executives,industryevents,etc.
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HfS Blueprint Scoring: IoT Services Scoring Percentage
Breakdown
EXECUTION
45%
Quality ofCustomerRelationships
QualityofAccountManagementTeam
HowServiceProvidersIncorporateCustomerFeedback
Real-WorldDelivery Solutions
ProprietaryDeliveryModels
StandardDeliveryMethods
FlexiblePricingModelstoMeetCustomerNeeds
15%
5%
10%
20%
15%
5%
10%
INNOVATION
55%
FutureAlignmentwithChangingMarket
AcquisitionandInvestment Strategy
Partnership Ecosystem
Collaboration andDevelopmentTechniques
25%
5%
10%
10%
StrengthofVisionforIoTServices
15%
AbilitytoGoBeyondStage1(Digitization) withtheIoT
15%
CreationofProprietaryFrameworksforAnalyzingNeeds
IndustryExperience
TOTAL
©2016HfSResearchLtd. ExcerptforAccenture
5%
10%
100%
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Blueprint Scoring Definitions: Innovation
INNOVATION
Innovationisthecombinationofimprovingservicesandbusinessoutcomes.
FutureAlignmentwithChangingMarket
Howfuturelookingistheserviceproviderintermsofaligningitself—inskillsandofferings—
withtheevolvingmarketdemand?Isitkeepingpace,is itafastfollower,orisitleadingthe
way?
AcquisitionandCapabilityDevelopment
Howdoestheserviceproviderincorporate capabilitydevelopmentinvestments,including
acquisitions,intoitsstrategy,andwhathasbeenaccomplishedalready?
Partnership Ecosystem
Whatis theroleofpartnershipsinthedevelopmentoftheserviceprovider’ssolution
ecosystem?Howextensiveisthecurrentpartnershipecosystem?
CollaborationTechniques
HowwelldoestheserviceprovidercollaboratewithclientsandpartnerstodevelopPoCsinto
full-scalebusinesssolutionsandIoTofferings?
StrengthofVisionforIoTServices
DoestheserviceproviderhaveastrongvisionforservicesacrosstheIoTvaluechain?
AbilitytoGoBeyondStage1withtheIoT
Howwellhas the serviceproviderintegratedinnovativeapproachesandemerging skillsand
technologiesintoservices?Doesitalsobringthecoretechnologyplatformtoassistan
enterpriseindeployingthenextlevelofIoTsolutions?
CreationofProprietaryFrameworks
for AnalyzingNeeds
What,ifany,proprietaryframeworksdoestheserviceproviderutilizetoanalyzethe underlying
businessneed?
IndustryExpertise
Doestheserviceprovider haveanyindustryIoT-specificofferings?Ifso,what arethenatureof
these,andhowfaradvancedisitinbuildingthisareaout?
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page24
Blueprint Scoring Definitions: Execution
EXECUTION
Howwelldoestheserviceproviderexecuteonitscontractualagreement,andhowwelldoes
theserviceprovidermanagetheclient–providerrelationship?
QualityofCustomerRelationships
Howengagedareserviceprovidersinmanagingtheclientrelationshipbasedonthe
followingmetrics:qualityofaccountmanagement,serviceprovider/clientengagement,and
incorporationoffeedback?
QualityofAccountManagementTeam
Whatisthequalitylevelofprofessionalskillsintheaccountmanagementteam?
HowServiceProvidersIncorporate
CustomerFeedback
Howhaveserviceproviderstakenfeedbackandincorporatedthatfeedbackintoofferings?
Real-WorldDeliverySolutions
Doesthesolutionprovidedcomparefavorablytopeersregardingvaluecreationthrough
currentofferings,partnerships,subjectmatterexpertise,anddeliverymodels?
ProprietaryDeliveryModels
What, ifany, proprietarysoftwareplatformsandprocessstructureshastheserviceprovider
createdtodelivertheseservices?
StandardDeliveryMethods
What,ifany,standardsoftwaretoolsandbusinessplatformsdoestheserviceproviderutilize
todelivertheseservices?
FlexiblePricingModelstoMeetCustomer
Needs
©2016HfSResearchLtd. ExcerptforAccenture
Howflexiblearetheserviceproviderswhendeterminingpricingofcontracts?Havethe
serviceprovidersalignedthesetermswiththeuniquedemandsofIoTprojects?
Proprietary│Page25
Service Provider Analysis
Guide to the Blueprint Grid
Todistinguishserviceprovidersthatshowcompetitivedifferentiationinaparticularlineofdeliverywith
progressinrealizingtheAs-a-ServiceEconomyofbusinessoutcome-oriented,on-demandtalentand
technologyservices,HfSawardstheseproviderstheAs-a-ServiceWinner’sCircledesignation.
EXECUTION
INNOVATION
As-a-ServiceWinner’s Circle
showexcellencerecognizedbyclients
inthe8Idealsin executionand
innovation
Collaborativerelationshipswithclients,
servicesexecutedwithacombinationof
talentandtechnology asappropriate,and
flexiblearrangements.
Articulatevisionanda“newwayof
thinking,”haverecognizableinvestmentsin
futurecapabilities,strongclientfeedback,
and aredrivingnewinsights andmodels.
HighPerformers
demonstratestrongcapabilitiesbut
lackaninnovativevisionor
momentuminexecutionofthevision
Executesomeofthefollowingareaswith
excellence:worthwhilerelationshipswith
clients,servicesexecutedwith“green
lights,”andflexibilitywhenmeetingclients’
needs.
Typically, describeavisionandplansto
investinfuturecapabilitiesand
partnershipsforAs-a-Service,andillustrate
an abilitytoleveragedigitaltechnologies
and/ordevelop newinsightswithclients.
High Potentials
demonstratevisionandstrategybut
haveyettogainmomentumin
executionofit
Earlyresultsandproof pointsfrom
examplesinnewserviceareasor
innovativeservicemodels,butlackscale,
broadimpact,andmomentuminthe
capabilityunderreview.
Well-plotted strategyandthought
leadership,showcaseduseofnewer
technologiesand/orroadmap,andtalent
developmentplans.
ExecutionPowerhouses
demonstratesolid,reliableexecution
buthaveyettoshowsignificant
innovationorvision
Evidence ofoperationalexcellence;
however,stillmoreofadirective
engagementbetweenaserviceprovider
anditsclients.
Lessevidentvisionandinvestmentin
future-orientedcapability,suchasskills
development,“intelligentoperations,”or
digitaltechnologies.
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page27
HfS Blueprint Grid: Internet of Things (IoT) 2016
InvestinginInnovationtoChange
ExcellentatInnovationandExecution
HIGH
POTENTIALS
AS-A-SERVICE
WINNER’S
CIRCLE
HIGH
PERFORMERS
Accenture
Atos
IBM
NTTData
INNOVATION
VirtusaPolaris
HCL
Infosys
Syntel Tieto
DellServices
©2016HfSResearchLtd. ExcerptforAccenture
EXECUTION
Proprietary│Page28
Cognizant
EPAM
TechMahindra
TCS
Luxoft
NIITTechnologies
BuildingAllCapabilities
Harman
Genpact
ExecutionIsAheadofInnovation
EXECUTION
POWERHOUSES
Major Service Provider Dynamics: Highlights
INNOVATION
EXECUTION
• BecausetheIoTistypicallyasubsetofabroaderbusiness
strategy,manysuppliershavepurchaseddesignand
ideationfirms(TechMahindrapurchasedPininfarina,
Cognizant Designit asexamples)tomoveupthestrategy
andinnovationvaluechainaroundbroaderdigital
constructs.Howwelltheseadd-instolargeIT
organizationsworkinthecontextofclientstrategicneeds
requiresclosescrutiny.Accenture currentlyhaveatactical
advantage sincetheyarealreadytrustedstrategicadvisors.
• Buyingdecisionsareofteninfluencedbycomparingpricing
flexibilityandco-investmentoptionswith sharedrisksand
rewards.BuyerscitedIBM,Harman,TCS,and Tietofor
flexibility,whileAccenture,Atos,NTTDATA, and Tech
MahindraAs-a-ServicepricingforIoTisconsidered
forward-thinkingforsubscription-basedpromised
outcomesovertime.
• Innovationinthe IndustrialInternetevolutioninheavy
machineryisverydifferentfromthemoreinterconnected
digitalworld.Harman,Atos, and Luxoftarewell
establishedinthesmartcarstandardsecosphere,for
example,butothersmayhavegreateragilityin
entrepreneurialconnectedproductefforts,dependingon
businessgoals,needs,andscale.
• Where theOil&Gas, Utilities,and Mining&Resources
verticalsarefocusedonmodestinnovationwithincomplex
legacyindustrialframeworks,innovationinconnected
smart“things”areonaverydifferenttrajectorywhere
proof-of-valueexperimentationiscommon.Itisunfairto
calloutspecificsuppliersheregiventheirdifferent
dimensionsofinnovation.
©2016HfSResearchLtd. ExcerptforAccenture
• Decisionmakingabout proprietaryand/oropensource
standardsiscriticalfor the IoT,particularlyfor
interoperabilitywithlegacysystems.Vendorsthat
collaboratewithpartnersandclientsareimportant,
with Cognizant,EPAM, Genpact,andNIIT receivingkudos
forworkingcloselywithclients.
• Tie-instolarger“systemsofintelligence”whereIoTdata
flowstoandfromlargercoredigitalenterprisesystemsas
partofbroaderdigitalstrategiesrequiresophisticated
strategyandsuppliers.Accenture,Atos,IBM,and Infosys
wereconsideredparticularlycapableatthislevelof
execution.
Proprietary│Page29
IoT Services Value Chain
IoTServicesarethosethatdesign,create,andmanageapathwayforthephysicalworldtoenterthe
As-a-ServiceEconomybycreatingabridgebetweenhardgoods(andservices)anddigitalinfrastructure.
IoTCONSULTING
IoT ENABLEMENT
• Strategicplanningand
businesscase
development
• Governancestrategy
• IoTtechnology
roadmap(reference
architecture)
• Productengineering
• Sensordevelopment
Softwareengineering
Embeddedtech
Devicesecurity
CustomAppDev
(dashboards,
visualization,etc.)
• Physicalprototypingof
“things”
•
•
•
•
• Securitystrategy
• Datatransportand
telecomcostconsulting
IoT CONNECTIVITY
• Networkengineering
• Network
implementation
• Networksecurity
• Telecom
IoT INTEGRATION
IoT MANAGEMENT
• Databasedesignand
build
• Devicemanagement
• Cloudhosting
• Analytics
Implementation
• Systemintegration
• Application
modernization
• Networkmanagement
• Datasecurity
• Security
IoTServices,however,donotincludethefollowingactivitieswhenconductedasastandaloneservice:deployingoroperating analytics,
implementingorrunningadatarepository,developingordeliveringanetwork,andcreatingormaintainingaphysicaldevicewiththe
capacitytocreateand/orcommunicatedata.ThosestandaloneactivitieswouldbeclassifiedasAnalytics,BigData,Network
Implementation,andProductEngineeringServices,respectively.
KeytoServicesMaturityontheServiceProviderProfilePages
ReliesonPartners
LessMatureServices
MoreMatureServices
Maturityisbasedonthefull
setofweightingcriteriafor
IoTServices,andthefive
boxesarethefiveareasof
thevaluechain.
©2016HfSResearchLtd. ExcerptforAccenture
Not Mature
LessMature
MoreMature
Proprietary│Page30
KeytoFour
Strengths/Weaknesses
ontheServiceProvider
ProfilePages:Innovation,
Execution,Industrial,
andEntrepreneurial
The Current Maturity of Service Provider
IoT Service Offerings and Capabilities
CONSULTING
ENABLEMENT
CONNECTIVITY
INTEGRATION
Accenture
Atos
MANAGEMENT
KeytoServices
Maturityonthe
ServiceProvider
ProfilePages
ReliesonPartners
Cognizant
Dell
LessMatureServices
EPAM
MoreMatureServices
Genpact
Harman
KeytoFour
Strengths/Weaknesses
ontheServiceProvider
ProfilePages:Innovation,
Execution,Industrial,
and Entrepreneurial
HCL
IBM
Infosys
Luxoft
NIITTechnologies
NTTDATA
Not Mature
Syntel
LessMature
TCS
MoreMature
TechMahindra
Tieto
VirtusaPolaris
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page31
Accenture
Winner’s Circle
BusinessstrategythroughtoexecutioncontinuitywithstrongIoT
expertiseasaningredientofabroaderdigitalplatform
Strengths
Challenges
• IoTIsintheMobilityGroupWithinDigitalPractice:Accenture’sMobilityStrategy
andConsultinggroupheadsupinnovationanddrivesactionplanswithclientsfor
theIoT,pullinginthevariousAccentureplatformtechnologiesandpartnershipsas
needed.Momentumisunderwaywith1,200+IoTengagementsin2015and2016.
• InternalPlatforms,TightPartnerRelationships:Thereisafocusondeveloping
additionalproprietarydigitalsoftwareandAPIsthisfiscalyearfortheIoTinorderto
buildoutfoundationsforAccentureanditsclients.
• VeryStronginLarge-ScaleComplexIndustrialandManufacturingIoT,and
ConnectedSmartBuildings:With30As-a-ServiceIoTapps,Accentureisinvesting
aheadofthecurveforallsizesofprojectsfrombuildingstothe“things”connected
tothem.
• StrongPortfolioofIoTWork:Accentureismatureandexperiencedacrossmany
industryverticalsinIoT,implementingthebackenddataflowsandinteroperability
neededtodisseminateintelligence.
• AccentureIoTIgnite:Thismethodologydrivesbusinessvalueprototyping,PoCs,
andprojectplanningtieswiththelargerservicesorganizationtoscaleprojects.
• SignificantReady-to-DeployTechnologies:Accenture’sacceleratorsallowagility
andspeedtomarketforIoTprojects,backedbydedicatedstaffingandprocesses.
• As-a-ServicePositioning:Accenturecontinuestoactivelybuild
itsIoTofferingsaroundanAs-a-Servicemodel.Thisapproach,
alongwithcomplexpartneringrelationships,maynotbea
goodfitforsomeclientneedsandculturesrootedinless
flexibleworkflowsandtechnologyrelationships,and
Accenturewillneedtohelpbridgethesecompaniesfrom
todaytotomorrow.
• IoTEmbeddedinMobilityPractice:This makessensefroman
Industry4.0perspective,butsomecompetitorshaveamore
directlineagetodigitalstrategy,abetterfitforcertaintypesof
IoTgoals.
• StrongPartnershipModel:Accenture mayrunintochallenges
asthemarketmaturesandexistingbusinessmodelsare
disruptedbetweenlargertechplayers,causingstresstoclient
platformsasformeralliesbecomeadversaries.
• Messaging: IoTisburiedingenericAccenturedigitalmarketing
positioning,anditcanbehardtoidentifyspecificAccenture
IoTattributes,uniqueselling,andvaluepropositions.
BlueprintLeadingHighlights
•
•
•
•
BroadDigitalStrategicStrengths
StrongVisionfortheIoT
FlexiblePricingModels
CreationofProprietary
Frameworks
• IndustryExpertise
IoTServicesOfferingMaturity:
IoTConsulting
IoTEnablement
IoT Connectivity
IoTIntegration
IoTManagement
Service DeliveryOperations
Innovation
Execution
Industrial
Entrepreneurial
Headcount: About5000inIoTandMobile,about
36000inAccentureDigital
DeliveryNetwork:30%US,Europe,Asia;55%
India;10%Philippines;5%EasternEurope
©2016HfSResearchLtd. ExcerptforAccenture
Client Profile
Acquisitions/Partnerships
Go-to-MarketApproach:
Accenture’sIoTpracticeformedinDecember2014aspart
ofAccentureMobility,whichispartofAccentureDigital.
AccentureIoTpracticeorganizedacrossfivebusiness
towers:ConnectedTransport,ConnectedSpaces,
ConnectedOperations,ConnectedHealth,andConnected
Commerce.Thesetowershave30+clientoffers.
TargetIndustries:
Global2000companiesin19industries.TheAccentureIoT
coretargetindustriesinclude: Utilities,Energy,Industrial
Equipment,Chemicals,Travel,andTransportation.
Acquisitions:Mobgen(2016)
•
OPSRules(2016)
•
Cimation(2015)
•
Gapso(2015)
RelevantStrategicInvestments
•
RippleLabs(2016)
•
VenueNext(2015)
•
ChaoticMoon (2014)
•
Apigee(2013)
Partnerships:
• AmazonWebServices
• Apigee
• Cisco
• GE
• Intel
• Microsoft
Proprietary│Page32
ProprietaryTechnologies/Platforms
ConnectedTransport:ConnectedVehicle,Fleet,Transit
Systems,Insurance,Freight.
ConnectedSpaces:ConnectedHome,ConnectedBuildings,
ConnectedCities
ConnectedOperations:ConnectedAssetManagement,
ConnectedWorker,ConnectedManufacturing,Connected
Agriculture
ConnectedHealth:RemotePatientMonitoring,Wellness
and Prevention,ConnectedPharma,IntelligentHealth
Enterprise
ConnectedCommerce:IoTPaymentand DataSecurity,
Blockchainand Cryptocurrency,ConnectedContextual
Commerce.
IoTplatform:ConnectedPlatformsasaService (CPaaS)
integratedwithAccentureInsightsPlatform,acloud
analyticssolution,andtheAccentureIoTDevice
Platform(AIDP)anARM-basedRapidPrototypingdevice
developmentplatform.
Market Direction and
Recommendations
What Is Next for IoT Services
WeseethefollowingasthemajortrendsinthematurationofIoTServicesoverthenext
2–3years:
n
Themarketwillremainlooselydefinedassomeserviceprovidersrebadgeolder
analytics,mobile,andcloudpracticesas“IoTServices”whileotherscreatestandalone
practices—somenarrowpointsolutions,somebroaderandincludingelementsof
IoT/IndustrialInternet.
n
Asusecasesmatureandmarketdemandforsensordataflowsincreases,moreand
moreserviceproviderswillpositionthemselvesasIoTcapableandready.
n
Standardsandsecuritywillcontinuetobeproblemareasthatimpedeusecasesasthe
IoTevolvesandbecomesmorecomplex.
n
ThematureIndustry4.0andinnovative,emergentIoTuseswillbeincreasingly
intertwinedandreliantoneachother.
n
AstheIoTisanattributeofbroaderdigitaldataflowvaluesneedsforbusiness,
coherentplatformpartnershipswillbecomeincreasinglycrucialforsuccessfor
suppliersandbuyers.
n
Creatingdataflows,APIs,andanalyticsaretablestakesforservices,whileidentifying
businessvaluefromtheIoTwillbeanincreasinglyimportantdifferentiator.
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page34
IoT Services Market Adopting As-a-Service Ideals
HowIdealsWillProgressBetweenServiceBuyersandServiceProviders
IDEAL
AS-A-SERVICE
IDEALDEFINITION
NONEXISTENT
INITIAL
EXPANSIVE
EXTENSIVE
ALL
PERVASIVE
WriteOffLegacy
Usingplatform-basedsolutions,DevOps,and
APIecosystemsformoreagile,lessexceptionorientedsystemsandprocesses
2016
DesignThinking
Understandingthebusinesscontextto
reimagineprocessesalignedwithmeetingclient
needs
2016
Brokers of
Capability
Orientinggovernance tosourceexpertisefrom
allavailablesources,bothinternallyand
externally,toaddresscapabilitygaps
2016
2020
Collaborative
Engagement
Ensuring relationshipsarecontractedtodrive
sustainedexpertiseanddefinedoutcomes
2016
2020
Intelligent
Automation
Use ofautomationandcognitivecomputingto
blendanalytics,talent,andtechnology
2016
2020
Accessibleand
ActionableData
Applyinganalyticsmodels,techniques,and
insightsfrombigdatainrealtime
2016
2020
HolisticSecurity
Proactivelymanagingdigitaldataacrossthe
servicechainofpeople,systems,andprocesses
2016
2020
Plug-and-Play
DigitalBusiness
Services
Plugginginto“readytogo”business-outcome
focused, people,process,andtechnology
solutionswithsecuritymeasures
©2016HfSResearchLtd. ExcerptforAccenture
2016
Proprietary│Page35
2020
2020
2020
2016–17 Recommendations: Enterprise Buyers
n
Beawareofyour opportunitiesand goals: ThematureIndustrialInternetand theemergent IoTaretwo
dimensionsofthebusinessadvantagesbroaderdigitaldataflowscancreate.Itispossibletounlockthe
valuefromtheseonlywithacoherentbroaderstrategy.Manyserviceprovidershavetechnicalexecution
skillsbutarelightonbusinessacumenincreatingandstitchingtogetherthedata“wiring” needed
to realize valuefromsmart “things.”
n
End-to-end securityisessential: Breachesofnetworksremainamassiveconcernasstandardsandusecases
mature.Theweakestlinkwillbesoughtoutbyattackers,andtheIoTprovidesdangerousphysical
opportunitiesinadditiontodatatheftunlesscarefulthoughtisgiventoallstagesofconnectivityand
operation.
n
RealIoTactionishappeningingreatsecrecy: MostpubliclydiscussedIoT initiatives eitherarematurewith
littlecompetitivesensitivityorareprojectsandpilots thatrequirepublicity.Themostinterestingworkis,by
nature,strategicallyimportantandunderwraps—pressvendorstoexplaintheirdifferentiationbeyond
genericprojects.
n
Pointsolutionsare very different frombroaderdataflowsfrommultipledigitalelements: Addingsensors
andgatheringdataoftencontinueto betheeasiestaspectsoftheIoT.Creatingdatarepositoriesthatcan
capturenewinsightsisnowstraightforwardandcanbeleveragedacrossthefirm.Therealchallengeforthe
IoTischanging broader end-userprocessestodigitalplatformparadigms.
n
DeepskillsintheIndustrialInternetarenotthesameasentrepreneurialinnovation:Whiletheheavy
machinery–focusedMachinetoMachine(M2M)Internethasbeenevolvingformorethanadecade,
emergentdigitalbusinessmodelsforsensor-enabledmass-produceddevicesareaverydifferentworldthat
requiresdigitalstrategyapproachestomaximizebenefitfromdatacreation.
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page36
2016–17 Shared Strategic Challenges: IoT Service
Providers
n
Wheretoinvest?LegacyITservicescompanieshavesignificantchallengesinmakingIoTinvestment
commitments,withtheirgrowthinvestmentsatriskfromendlesslow-value“tirekicking”exercisesby
prospectstentativelyexploringandunderstandingbusinessvalue.As-a-Serviceapproachesthisproblem
withflexiblerisk-sharingoptionsthathelpbothsidesoftherelationshipgettogripswithriskandreward
options.Education,strategy,anddesignthinkingsessionshelpqualifyandreinventperceptionsofIT
providersasbeingontopofwhatisaverynewfocusareaformostpeople.
n
Wheretopartner?Partnerecospheresinthe“systemsofintelligence”erarevolvearounddataflows,with
IoTdevicesofallsizesinteractingwiththecoreofbusinesssystems.Manyoftheolderenterprisesystems
wereneverintendedforthesevolumesofsophisticatedtransactionsandsecurity.ThismeansIoTservice
providershavetochoosetheirpartnerswiselytobealignedwithplatformsthatarefitforpurposeand
makesenseforclientstoinvestinaspartoftheiroperations.
n
Wheretofocus?Pure-playdeep“bornIoT”servicesarefrequentlynotwellalignedwithbroaderdigital
transformationeffortsoflargeclientsarounddatavalue,despiteIoTsensordatabeingincreasingimportant
acrossmostverticals.Pointsolutionthinkingandlackofidentificationofdatavalueadjacenciescoulddoom
somehighlyskilledplayerstobeingmerelycommodityprovisionersunlessstrategichorizonsarebroadened.
n
Whichstandardstogetbehind?Consistentstandards,security,anddescriptorsareessentialifsharedgoals
acrosstheserviceproviderspectrumaretobemet:Tomanyprospects,IoTisabewilderingblizzardof
buzzwords,conflictingstandards,poorinteroperability,andscarysecurityopportunities.
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page37
2016–17 Recommendations: Service Providers, continued
n
Abuyers’marketfornow:Forastill-emergingmarket,IoTServicesarebroadanddeepwithpatchyuptake
atwhatsometimeseemsalmostrandomsegmentinterestbyprospects.Consistencyisfoundviaclearpaths
tobusinessvalue,whichareachievedwithstrategicconsultingandplanning.Whethersupplierschooseto
drivethisactivitythemselvesorpartnerwithconsultingcompanies,thisisalmostinvariablywherescale
projectsoriginateandwherefocusmustbeconcentrated.
n
End-to-end ischallenging: TheIndustrialInternethasmatureincumbentswhilethedigitalentrepreneur
spaceisfarmorefluid.Whiletheysharesomesimilartechnologicalunderpinnings,thebusinessdynamics
areverydifferent,andchoosingwhereandinwhatsegmentstospecializeisincreasinglyimportanttobuild
outpractices.Partneringadjacenciesarecriticallyimportanttoprovidebroaderofferingsthatmeet
prospectandclientneeds,whileprovidingscalingoptions.
n
Platformoropensource/bestofbreed?Both? Manymoderndigitalcompaniesare“fullstack”
environmentswithalotofopensourceflexibility.TheIoTspacehasmanycompetingproprietaryplatform
approachesfromlargevendorsthatservicesproviderscanleverage.Findingabalancethatavoidsvendor
lock-inisonprospectandclientmindsjustasitiswithsuppliers.As-a-Servicelendsitselftoplatform
approaches, butopensourceisanessentialelementofsystemsintegrationanddigitaldataflow
enablement.
n
Securitysecurity security:Fearofsecuritybreachesisasignificantbarriertomanycommercialdigital
initiatives,andconcernsabout“theweakestlink” areallthemoreseriouswhen“things”canbe
compromised.ClientsbeingabletosleepatnightknowingtheirnewIoTenvironmentsaresecurearetable
stakesforparticipation.
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page38
About the Author
Oliver Marks
VPDigital&IoT,HfSResearch– SanFrancisco, CA
Overview
• LeadsDigitalandInternetofThingsresearchforHfSResearch
• Extensivepriorexperienceconsultingandadvisingwithcompanieson
effectiveinternationaldigitaltransformationstrategyandexecution
• Streamlining,simplifying, andmodernizingwaysofworking,findingthe
correct“recipe”ofnewtoolstocombinewithlegacysystemsandprocesses,
andidentifyingviablebusinessmodels
PreviousExperience
•
Built,ran,managed,andevolvedglobalgamedevelopercollaborationenvironmentat
SonyPlayStationWorldwideStudios
•
LedtheGlobalDigitalEnterpriseTransformationconsultingteamatHP
•
Numerousreal-worldstrategicprojectsundertightNDAinmultipleindustryverticals,
includingCPG,BFSI,Energy,andMergers&Acquisitiondigitalbusinessstrategies
•
OliverisbasedintheSanFranciscoBayareaandgrewupintheUK.
[email protected]
©2016HfSResearchLtd. ExcerptforAccenture
Proprietary│Page40
About HfS Research
HfSResearch isTheServicesResearchCompany™—theleadinganalystauthorityandglobalcommunityforbusiness
operationsandITservices.Thefirmhelpsenterprisesvalidatetheirglobaloperatingmodelswithworld-class
researchandpeernetworking.
HfSResearchcoinedthetermTheAs-a-ServiceEconomy toillustratethechallengesandopportunitiesfacing
enterprisesthatneedtore-architecttheiroperationstothriveinanageofdigitaldisruption,whilegrapplingwithan
increasinglycomplexglobalbusinessenvironment.HfScreatedtheEightIdealsofBeingAs-a-Service asaguiding
frameworktohelpservicebuyersandprovidersaddressthesechallengesandseizetheinitiative.
Withspecificfocusonthedigitizationofbusinessprocesses,intelligentautomation,andoutsourcing,HfShasdeep
industryexpertiseinhealthcare,lifesciences,retail,manufacturing,energy, utilities,telecommunications, and
financialservices. HfSusesitsgroundbreakingBlueprintMethodology™toevaluatetheabilityofserviceand
technologyproviderstoinnovateandexecutetheEightIdeals.
HfSfacilitatesathrivinganddynamicglobalcommunityofmorethan100,000activesubscribers,whichaddsrichness
toitsresearch.Inaddition,HfSholdsseveralServiceLeadersSummits everyyear,bringingtogetherseniorservice
buyers,providers,andtechnologysuppliersinanintimateforumtodevelopcollectiverecommendations—forthe
industryandtoadddepthtothefirm’sresearchpublicationsandanalystofferings.
Nowinits tenthyearofpublication,HfSResearch’sacclaimedblogHorsesforSources isthemostwidelyreadand
trusteddestinationforunfetteredcollectiveinsight,research,andopendebateaboutsourcingindustryissuesand
developments.HorsesforSourcesandtheHfSnetworkofsitesreceivemorethanamillionwebvisitsayear.
HfSwasnamed AnalystFirmoftheYearfor2016,alongsideGartnerandForrester,byleadinganalystobserver
InfluencerRelations.
©2016HfSResearchLtd. ExcerptforAccenture
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