Whether it’s a piece of industrial equipment or an ordinary pair of sneakers, everything is connected in today’s modern world. Thanks to affordable sensors and the Internet of Things (IoT), smart, connected products are on the rise, and they’re changing the way the world does business.
For the first time ever, manufacturers with digital online connections to their products can understand how they’re performing in the field, in real-time, throughout the customer’s life cycle. This information is enormously valuable to these manufacturers because it provides specific and actionable insights from real users how to improve the products and create new ones.
Smart, connected products don’t just open up a world of opportunities; they also make it possible to gain an edge over competitors.
We see seven major benefits from adding digital sensors to a firm’s products:
- Far, more effective product updates and development: Updating products with new functionalities and patches is a breeze when you’re always connected to them.
- Cheaper, more efficient maintenance and repair: Monitoring your products in real-time helps you streamline the repair and maintenance process.
- New, better business models: Analyzing smart product data allows you to evaluate new business lines and decide whether you want to continue manufacturing and selling products or turn into a business that sells your products as a service.
- Improved product usage: Understanding how end-users use your products provides you with an opportunity to suggest to customers better and more productive ways of using those products, ensuring a deeper engagement with your brand.
- Better product recall processes: Tracking the health and function of your products can ensure product defects and hazards don’t go unnoticed, significantly reducing recall-costs and damage to reputation.
- Reduced environmental impact: Minimizing the impact of components that make up your devices is easier if you track them, evaluate if they can be reused, and ensure they’re recycled properly.
- More intelligent, adaptive supply chains: Gaining access to all that data from your smart products makes it possible to create realistic models that predict pending supply chain bottlenecks.
While these benefits illustrate how manufacturers are leveraging smart, connected products, there’s a lot more you can do if you carefully evaluate how your industry works, revisit the pain points customers tell you about, and determine how sensors can benefit your products, business, and business model.
How your business can benefit from smart, connected products isn’t something you should explore just because the costs of building such products are dramatically falling; it’s something you must work on in any case with laser-like focus because ignoring the opportunity means giving your competitors a big leg up in the game. To learn more about smart products, understand how to evaluate opportunities, and determine the next steps for your business, read my article Why Your Products Must Be Smart and Connected, in this edition ofPerspectives, our management journal.