IoT – a necessity for digital leaders

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Spending $6 trillion on Internet of Things solutions in the next 5 years demonstrates that businesses will rely heavily on IoT to process mine their activities. The number of devices that can allow for the optimization of business processes is rising rapidly while the cost of individual units is decreasing. A consumer example of this change is the RaspberryPi zero which cost only $5 but has most of the functionality of the original model B. This device allows for the automatization and monitoring of simple electronic controllers. It is obvious that businesses would employ the use of specialized devices for each process, but the example still stands as the small device enables the same functionality as the specialized ones.

Current business models can still benefit a lot from process mining as it allows a granular view and even, possibly, live control of activities, such as production material inflow. Monitoring and controlling whether the supply line is experiencing deviations from regular operating conditions and having immediate responses for irregularities minimizing the potential problems that wouldn’t have been noticed otherwise.

iot

The recent surge in IoT adoption in investment is probably due to the tie in effect with cloud, artificial intelligence and predictive analytics as it was not possible to process such big data streams before without incurring significant costs making the entire project not viable. Computing as a service has revolutionized the cost for companies as they should pay per use and not invest heavily when they decide to expand their process monitoring. Less local servers required, higher likelihood of implementing devices which only need to communicate with the cloud. As the cost of maintenance of IoT devices is significantly lower than maintaining the respective servers, companies are more likely to invest in IoT as the devices do not require incremental upgrades to improve functionality, they are purposed designed, hence are considered future proof.

Sources:

http://www.forbes.com/sites/sap/2016/12/08/turning-the-internet-of-things-into-an-internet-of-outcomes/#1d831ae67ca6

Raspberry Pi

 

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Amazon Go

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Amazon just launched a new idea, a grocery store without checkout lines. Who wouldn’t want that would you say?

Amazon Go will provide customers with a grab and go grocery store. Customers only have to check in at the entrance of the store with the new Amazon app, Amazon Go. Amazon keeps track of its products and customer in the shop, combining the most advanced machine learning and artificial intelligence, such as computer vision, deep-learning algorithms and sensor fusion to register who is buying what and to eliminate cash registers and long checkout lines.

There are different reactions to this new technology of people who are pleasantly surprised with the convenience it brings and those alarmed what this will mean for the society.

As racial profiling is a huge deal these days, minority shoppers may have their doubts about Amazon Go. As Amazon Go’s employees are there for customer service, “The danger isn’t just being stopped,” tech CEO Anil Dash said, “but more the low-level desire to not be potentially hassled even if it’s easily resolved.”  “In a world where even Oprah has been profiled for walking around a store, there are lots of people who might not want to risk trusting a store to treat them fairly,” tech CEO Anil Dash said in an email.

With the Amazon Go’s employees only focusing on customer service, a lot of cashiers can possibly lose their job. Employees are already warned that they have to adapt in order for them to keep a job. “If you’re willing to learn something about how the technology works and can either fix it or try to improve it, I think there will still be a job for you,” Tom Davenport, professor of information technology at Babson College said. “But if you’re wedded to the traditional point of sale grocery role, I think your future is quite limited.”

And we have not even discussed the privacy aspect of this new innovative way of shopping. With all the cameras and other equipment, data is collected and who knows what they will do with that…

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Let there be Light, as a Service

In 1924 the world’s largest light bulb manufacturers formed a cartel to control the manufacture and sale of light bulbs. The companies in the cartel determined a new standard for the lifespan of a light bulb as the bulbs kept on working so well that sales declined. This 1,000-hour standard is one of the earliest examples of planned obsolescence: designing a product with an artificially limited lifespan. In the past century, planned obsolescence led to an enormous amount of e-waste and pollution of the environment due to appliances that need replacement. Mix in the fact that most people do not care, for example, how their homes are lit as long as they are lit, a novel business model is readily born: Light(ing) as a Service (LaaS).

A true circular economy is within reach

LaaS is different from the traditional way of buying and owning a product that has to be replaced every now and then. LaaS, as the name implies, offers lighting as a service. In this way, Philips, to name one of the companies working with this concept, installs and maintains lighting for a small fee. The small fee could cover electricity costs and recycling as well. By letting the manufacturers themselves be solely responsible to deliver the service of lighting, there is a strong incentive for the manufacturers to use technology that is superior to what has ever been used before; Philips does want the light bulb to last as long as possible against low costs, to maximize the profit it earns with LaaS. As consequence, planned obsolescence is avoided and therefore less e-waste is produced. Besides, LaaS provides an easy access to the latest technology aiding in sustainable transitions without any huge investments upfront.

The possibilities to apply the business model of LaaS to other products are endless. Think about keeping your food refrigerated with Refrigerator as a Service. Are you up for Bike as a Service? Students in Delft can already make use of this service. What about offering appliances to small businesses in developing countries? Would this aid the local economy?

What other products could easily be “LaaS-ized”? Share your ideas in the comments.

References

http://www.makeuseof.com/tag/lighting-service-cut-energy-use-90/
http://www.mt.nl/series/de-4-businessmodellen-voor-licht-als-dienst/84981
http://www.duurzaambedrijfsleven.nl/industrie/6337/bruynzeel-storage-koopt-geen-verlichting-maar-licht-philips
http://www.ledinside.com/knowledge/2015/12/rethinking_lighting_as_a_service
http://chess-wise.eu/2016/06/06/light-as-a-service-why-how-to-shift-to-this-fortunate-business-model/

Documentary on planned obsolescence:
https://www.youtube.com/watch?v=zdh7_PA8GZU

More about e-waste:
https://www.youtube.com/watch?v=dd_ZttK3PuM

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The Smartification of Society

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From the advent of the Apple Watch, smart cars like the Tesla model S (not self-driving cars), the IoT, 3D printing, VR, Wearables and all the amazing tech trends we see it can be difficult to differentiate hype from reality. Here are some examples

 

What is certain is that everything in our lives is going to become smart the same way everyone in 1996 said the internet is going to change the world in 2000 but it really changed the world something like 2010. The deployment of accurate, easy to consume information from all things and objects around us to make our lives easier is going to hugely disrupt some industries forcing them to change the way they do things.

Let’s take the current education system for example as it is relevant to all of us and hypothesis how the combination of such trends might affect it. The descriptions that follow post might make you think I am not a fan of the current education system although these are just some observations and predictions meant not to offend but only to generate discussion. 

The university system is slowly losing its value proposition in face of the speed and intensity in the current business marketplace. Unfair debt structure of college loans can severely set a young person back. This brings to question whether college degrees are appropriate for everyone? It’s a hard conversation to have because the college dream has been so well branded. Yet it is fascinating how little parallel can be made between one’s level of education and success (financial) in the modern business world.

We can’t be so naive or misguided to suggest that time spent in a top university can’t help one get closer to financial success and diplomas are entry level requirements for thousands of jobs. If one wants to be a lawyer or doctor or many of the other professions that take a college degree to become that thing, then going to the best possible college that will help one get the job of their dreams is wise. If you want to run a business, be a photographer, an artist of any kind or a designer a degree is not necessary, though it will help. Many of us are lucky enough to go to university to soak up the experience, network and most importantly learn about ourselves (self-awareness).

The free education that will be available on the internet will be incredible and the current 10 year old’s may be the last generation that holds university to such high esteem. Online courses such as Khan Academy, Creative Live, Udemy, Udacity, Skillshare and tons of other startups are putting out incredible platforms that acquire incredible talent teaching courses on these platforms. Is this a better ROI than the college professors that have been out of the game for 5-10 years? There is definitely lots of money to be made within this industry as shown by new suppliers such as Masterclass entering the market where experts regardless of whether they went to university or not their work speaks for itself. Signs of a steady decrease in the quality university education are showing themselves as illustrated in a recent article published by the Guardian. It says “an Oxford graduate is suing the university for £1m claiming the “appallingly bad” and “boring” teaching cost him a first-class degree and prevented him from having a successful career”.

This brings to question is studying at home on the internet any different from going to a class with 400 students where you barely remember the lecturer’s name and education is standardized to make it efficient and very profitable.?

In addition, with coworking spaces and incubators slowly becoming a common denominator in many cities where one can network in combination with traveling to expand one’s horizons, why incur debt that you can’t even declare bankruptcy against.

One thing is for certain, university alone will not properly train you to be a prime time player in today’s business environment and many of the theories you might learn there about marketing or economics will already be too obsolete. The ENTIRE market moves at such a speed that even great entrepreneurs or experts have a hard time keeping up with it. Within a month of one’s graduation there will always be a new app, new platform or new channel or way for doing business that didn’t exist before.

How people judge anything is what brings value to the equation. Because decision makers in business today highly value a diploma from Harvard or MIT or Yale young students opt to go there and find it valuable. As soon as big companies or key players/individuals in the market such as Google come along and start valuing actual data and work to prove if you’re good at something the diploma will lose its value because whoever is judging dictates the rules of the game. Being a practitioner and student or teacher is very very different. We are slowly moving to a Post-GPA world.

Lazlo Bock the Senior Vice President of People Operations at Google says “The academic setting is an artificial place where people are highly trained to succeed only in a specific environment. One of my own frustrations when I was in college and grad school is that you knew the professor was looking for a specific answer. You could figure that out, but it’s much more interesting to solve problems where there isn’t an obvious answer. You want people who like figuring out stuff where there is no obvious answer.

However, the thought that we can switch the entire system; government, history, infrastructure etc is just not going to happen because the machine is too broken in the modern information world, it’s too big.. What could happen is what happens in business. Something comes along and disrupts it. A car was invented which disrupted the horse. Uber disrupted taxi services. All of a sudden taxi services are doing all these great things because they are forced to. They didn’t want to innovate.

Students are being taught information to regurgitate it from their heads using mostly short term memory, yet it is literally at their fingertips on their phones. If you really care about education you should not care how it’s being deployed, but instead about the accuracy and impact and how they execute that information. One can be informed in any way and that’s what we should focus on. Universities should pivot on putting young people in the best position to succeed in 2020, 2030 and not 2010.

“What you know doesn’t mean shit. What do you do consistently” Tony Robbins 

Inspired by the book #AskGaryVee: One Entrepreneur’s Take on Leadership, Social Media, and Self-Awareness.

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Business Agility, you had my curiosity but now you have my attention.

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As probably everyone else, I am currently busy studying for the upcoming mid-term. However, half-way through session 4 (Digital Transformation) I was in need of break and decided it was the right time to write a blogpost about a term that intrigued me while reviewing the lectures.
In session 4, the ‘main IT issues in an organization’ are mentioned. The top 3 consists of:
1. Alignment of IT and Business (the focus of the rest of that lecture)
2. Business Agility
3. IT Time to Market
While looking at that Top 3, the term ‘Business Agility’ got my curiousity. What exactly is Business Agility? And what does it entail?

Business agility can be defined as ‘the distinct qualities that allow organisations to respond rapidly to changes in the internal and external environment without losing momentum or vision‘. Essential qualities to long-term business agility are (1) adaptability, (2) flexibility, and (3) balance.
It is important for companies that are looking to survive  in the long-term, and of special importance to businesses that operate in quick-paced industries. In today’s fast changing environment, I guess this statement appeals to most firms in every industry.
When thinking of (successful) change in a business context, a related term automatically pops up in mind: innovation. Innovation is often key to maintaining long-term business agility. Companies that don’t innovate and rely on ‘proven’ methods, often find themselves falling behind the competition because they can’t adapt quickly enough to shifts in the environment.

More specifically, Accenture defined 5 key success factors of a truly agile business (Accenture, 2014):
1. Build seasoned, diverse leadership teams with a focus on cross-cultural members
2. Prioritize strategic decisions and understand what the most important decisions are
3. Speed up decision making by having ‘the right people’ in the room
4. Invest in data and analytics to come to informed decisions
5. Prepare ecosystems to act quickly to changes in the environment

So summarized, agile organizations have got the right people, the right decision making processes, the right information, and the right ecosystem of partners to be able to be more effective and clearly differentiated in the marketplace. Agile companies can anticipate change, react faster than competitors and adapt their strategies and processes in light of disruptive events.

Business agility, you had my curiosity but now you have my attention.

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Hype cycle in commercial aerospace

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Emerging technologies and markets are exiting and can result in contribution for society. Business can prosper with new technologies. It is crucial to know where and how to invest in opportunities and show committed leadership which embrace renewal. A top-down approach with a transformative vision of the future. Initiatives are needed to empower the transformation (Westerman et al., 2014). In order to apprehend the implication for an industry it is interesting to look at Gartner’s hype cycle.

Due to the Commercial Space Launch Competitiveness Act, space is not a governmental program anymore (H.R.2262, 2015). Private businesses are playing a major factor and thriving innovation. The industry is growing and worth $ 314 billion in 2013. The business is powered by dominant actors such as billionaires and venture capitalists. They commit themselves to explore and exploit this largely unknown domain (Martin, 2014). Most of these actors are experienced in commercializing their initial businesses. They gained skills and a network which fuels hyping the industry and surrounding technologies. Such as SpaceX and the online announcement of their Mars endeavor for making humans multiplanetary (Musk, 2016). The hype cycle innovation trigger is already a decade behind us. The innovation is initiated by governments and got more and more commercial. The peak of inflated expectation is not on its height. Privatization more or less focused at less riskier and technological feasible projects between low earth orbit (LEO) and geostationary orbit (GEO). This new phase is riskier and has more technological challenges (Riebeek, 2009). Besides some minor failures, like exploding unmanned rockets, a lot of progress is made these days. The negative hype and trough of disillusionment in the hype cycle is often caused by failure. Mostly failure which does not match with the exaggerated expectations.

Most of the dominant actors behind the private space business made their wealth in leading companies within their industry. These business concede somewhat to Westerman et al. (2014) quote: “Digital masters see technologies as a way to rethink the way they do business, breaking free of outdated assumptions that arose from the limits of older technologies”. They know what it takes and how to achieve objectives. Is it possible to diminish the negative slope of the hype cycle with a strong transformative vision, leadership and a strong technological backbone? Can these billionaires and venture capitalists ‘beat’ the hype cycle and accelerate the commercial space technology?

 

References:

H.R.2262 – U.S. Commercial Space Launch Competitiveness … (2015, November 25). Retrieved October 25, 2016, from https://www.congress.gov/bill/114th-congress/house-bill/2262/text

Martin, K. (2014, December 2). The business of space: Exploring the new commercial space economy. Retrieved October 25, 2016, from http://america.aljazeera.com/watch/shows/real-money-with-alivelshi/articles/2014/12/2/the-business-of-spaceexploringthenewcommercialspaceeconomy.html

Musk, E. (2016, September 27). Mars. Retrieved October 25, 2016, from http://www.spacex.com/mars

Riebeek, H. (2009, September 4). Catalog of Earth Satellite Orbits. Retrieved October 25, 2016, from http://earthobservatory.nasa.gov/Features/OrbitsCatalog/

Westerman, G., Bonnet, D., & McAffee, A. 2014. Leading Digital: Turning Technology into Business Transformation, Harvard Business Review Press, 2014.

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Finally: a pretty and sustainable substitution for the ugly solar panels!

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Two weeks ago, CEO Elon Musk announced that Tesla will launch an exciting new product: roof tiles for houses made entirely from solar panels. I am convinced that this innovation will be breakthrough and really successful because of the following reasons:

1. Aesthetically pleasing
The solar roof tiles simply look prettier than the, in my opinion, ugly solar panels. Solar panels are black and massive and give a gloomy impression to the roof of a house. The solar roof tiles consist of quartz glass, but they look similar to normal roof tiles, which make them less distractive and striking.

2. Affordable price
The specific price of the product is not revealed yet, but the solar roof tiles will be as expensive or even cheaper than traditional tiles with traditional solar panels on it (Nu.nl, 2016).

3. Various product designs
The solar roof tiles will be available in four different styles. The first style – Tuscan Glass Tile – is most consistent with traditional roof tiles in the Netherlands and Belgium. I expect that this style will be most often selected since most Dutch house owners should consider the “welstandscommissie”, who assess building plans and signs and such for their appearance i.e. whether they will detract from the appearance of the street on which they would be placed or whether a sign is in keeping with the appearance of the street (Proz.com, 2016). The other three styles – ‘The Slate Glass Tile’, ‘The Textured Glass Tile’ and ‘The Smooth Glass Tile’ offer a good alternative for modern houses.

tiles Tesla, 2016

4. Sustainable and effective
The innovative tiles offer a sustainable way to generate energy. Besides that, they also do this in an effective way. According to Nu.nl, the current versions of the tiles are just as effective in converting sunlight into electricity as traditional solar panels (Nu.nl, 2016). Tesla even mentioned that they are trying to make to panels more efficient than traditional solar panels. One way to do this is to reduce energy losses by catching the light in the panels.

5. Strong material
Last, but not least. The solar roof tiles are made of quartz and are much stronger than roof tiles of clay, slate or terra cotta. You can see a short movie of the durability test via this link: https://www.youtube.com/watch?v=I1035WJzPTM

In conclusion, I think that this could be a successful innovation since it offers consumers a sustainable, cheap and elegant option to generate energy. Do you think that these solar roof tiles will hit the market? Do you think that people are willing to replace traditional tiles with new solar tiles? What kind of Business Model Reinvention Archetype do you think this is? I am curious to your opinions, so feel free to leave a comment!

By the way: If you are interested in this topic, I would definitely recommend watching the video about the solar roof tiles of Tesla, explained by Elon Musk: https://vimeo.com/189402941

Sources:
– http://www.proz.com/kudoz/dutch_to_english/law%3A_contracts/1137735-eisen_van_welstand.html
– http://www.nu.nl/gadgets/4342973/tesla-toont-zonnepaneeldak-huizen.html
– https://www.tesla.com/solar
– https://vimeo.com/189402941
– https://www.youtube.com/watch?v=I1035WJzPTM

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