IoT business models in an industrial context

Abstract

There is a broad consensus that the transformative power of the Internet of Things (IoT) will affect all kinds of industries; or, to put it in a more optimistic light, that almost no domain is excluded from the opportunities to leverage the IoT. But, what does this mean for the future of industrial processes? This article introduces the concept of high-resolution management (HRM). IoT enables the collection of high-resolution data for the physical world where, as in the digital world, every aspect of business operations can be measured in real-time. This capability facilitates high-resolution management, such as short optimization cycles in industrial production, logistics and equipment efficiency, comparable to methods like A/B-Testing or Search Engine Optimization, which are state of the art in digital business. We take the following two perspectives on leveraging high-resolution management. First, through greater insights into their industrial processes, companies that apply HRM in their operations are able to achieve higher efficiency, quality and flexibility. The example of vehicle fleet management illustrates this effect. Second, we build upon the St. Gallen Business Model Navigator in order to look in greater detail on how the IoT affects industrial processes. Gassmann et al.

Internet of Things: A Scientometric Review

“…[286]. This fourth industrial revolution aims to integrate IoT technologies such as remote control, manufacturing analytic tools and services, supply chains integration, and tracking and tracing inter-and intra-plant logistics [287]. Fog computing is also a new trending topic, with a small growth in 2011-2014 periods, but a large increase in the 2015-2016 period.…”

Activity-based costing in smart and connected products production enterprises

“…In other words, do patterns derive activities with different implications over ABC assumptions? First, patterns as defined by Weinberg et al (Weinberger, Bilgeri, & Fleisch, 2016) focus on different ways of generating profits which is an issue of business profitability and is better approached by theories of competitive strategy (which are out o the scope of this paper). Regarding production functions, the "Digitally charged products" pattern is related with traditional manufacturing activities of physical products, software development and data analytics.…”

Unlashing the Next Wave of Business Models in the Internet of Things Era: New Directions for a Research Agenda based on a Systematic Literature Review

“…The literature on business ecosystems highlights the need for a deeper network view on BMs [11], [52] as existing templates and frameworks might not be adequate tools when examining the interdependent nature of the growth and success of companies evolving within the same ecosystem [88]. Considering the development of the IoT field, it is evident that interdependency of different actors through technical and business ties is becoming essential [86]. However, despite being around for already two decades and touching upon every sphere of our lives [82], there remains substantial discrepancy regarding the IoT concept and its understanding.…”

“…We reaffirm the definition introduced in Haller et al [31] who consider the IoT as a world where physical objects seamlessly integrate into the information network and can become active participants in business processes. Such utilization of the IoT technologies introduces new business opportunities as remarkable improvements in the IoT sensor and actuator technologies and decrease in costs allow companies to leverage new data insights, introduce advanced offerings [86], and create completely new IoT enabled BMs [62]. For instance, consumer data might allow for both personalization and standardization of the offerings, resulting in new profit opportunities [55].…”

“…For instance, major technical challenges such as scalability, resource scarcity and security [1], [31], business development obstacles [85] or the inertia of incumbent firms [70]. On the other hand, IoT creates the foundation for design of new profitable BMs and value exchange mechanisms [22,23], [62], [86], and not only it is able to reshape the BMs but entire industry boundaries [63]. Nevertheless, so far only a few conceptualizations of the IoT-driven BMs have been introduced [43], [69], [74] and the literature coverage is still largely technology focused [82].…”