The Top 5 IoT Questions Your Board Needs Answered
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Principal Executive, IoT Scorecard
The most effective Board Directors share one common trait and quality above all other things: they ask great questions. Sometimes those questions are meant to provoke real discover, and other times they are meant to incite deep introspection. When it comes to the Internet of Things, there are plenty of open topics for Boards to explore.
I have spent many years working with senior technology leaders, and I’ve been privileged to have deep insight into the issues their Directors were most concerned with. For IoT, the agenda is familiar but the context, and potential outcome, is uncharted territory.
Is there a real market for these “things”?
Board members are tough customers when it comes to selling futures. Plenty of great ideas have died on the vine in boardrooms. Smart IoT products and solutions will be no exception. Board members are subject to the same amount of noise and hype we all are related to IoT market potential. Successful pitches I’ve seen related to IoT initiatives balanced out the hype with very focused data: the market segment, real demand metrics, comprehensive go to market strategy, and perhaps most important a measurable plan for revenue generation and return on investment. These are all the basic hallmarks of an initiative that’s been thoroughly developed, tested and has real support.
How secure is it?
The billion-dollar question, security. Boards have been repeatedly burned with storied commitments of low-risk scenarios. At the end of the day, your Board is either directly or indirectly culpable in a disaster scenario. This isn’t about debating the efficacy of one particular risk mitigation strategy versus another. Your Board needs to understand what technologies are in play, how you plan on securing them along with customer and company data, and how you’ll handle a breach of security when it happens. Both strategy and tactics have matured greatly in the last 10 years, and both are reflected strongly in well-prepared briefings.
How much will it cost?
Driving innovation and new opportunities might be your charter as a business or technology leader, but your Board’s charter is to make sure you don’t buy your own hype on a number of levels. Significant initiatives, especially when driven by new or untested technologies, requires a deep inspection of cost to the business. And it’s not just direct capital costs – developing the organizational skill sets, operational run rate, retiring legacy technologies or adding new capacity, even dilution of existing revenue streams all need to fuel a successful discussion.
What are the dependencies?
If the Internet of Things will usher in a new level of interoperable “things”, that means new partnerships. Some technical, some business and some with companies your Board would never believe relevant. Articulating the case for these external dependencies is crucial, since many of these relationships will make future business, operating, product and service plans more complex and difficult to forecast. On the technical side, some elements of IoT will mature more quickly than others (think hardware endpoints versus infrastructure).
What does this do to the business long term?
The Internet of Things will present a massive amount of disruption to almost every industry, but that disruption is not positive or negative. It represents a broader change in how businesses will operate and make money, and that’s an important point to drive home with Board members. A big part fo their job is ensuring viability long term. While not immediate, changes to core markets will generate the need for new revenue opportunities to offset displacement. This is no different than the “sharing economy” concept, where products once purchased on a one to one basis are now shared resources. That drastically changes the landscape, and IoT will present similar challenges and opportunities. Ensure these points – both positive and negative – are well represented.