Proving the Business Case for the Internet of Things

Enterprise architecture can deliver business value from IoT, says Gartner

Steve Rogerson
April 23, 2015
The key to managing the risks of the IoT while fully capitalising on the opportunities is an architecture strategy, according to market watcher Gartner, which says the IoT represents diverse technologies and usage that enables both unprecedented opportunities and risks for businesses.
“Enterprise architects have a great opportunity to position themselves at the heart of digital businesses," said Mike Walker, research director at Gartner. "This could take the form of establishing a business competency centre that explores how the IoT can create innovative breakthroughs for the organisation's business models, products and services through rapid experimentation."
Walker identified several trends that make the IoT particularly relevant to enterprise architecture as a discipline, which aims to lead proactively and holistically a business towards a specific strategic outcome. First, the IoT enables detailed insight into what customers want, and how to connect their needs with the journey planned by an organisation for its customers.
He said there should be a shift from the thing to composition.While individual things are perhaps not incredibly interesting, using their connectivity to group them together to measure certain data, or to form new business models and uses, creates almost unlimited potential. Smart, connected technologies don't just bring together things they link and combine people, places and information, creating new opportunities.
TheIoT, he said, would intrude on established procedures by revealing better ways to measure and operate the organisation through new and powerful analytics.
"In establishing a business competency centre, enterprise architects need to determine the potential impact, both positive and negative, of IoT technologies and then create actionable deliverables that can define which business opportunities should be pursued as a result," said Walker. "The first step is bringing together various business units and IT leaders to explore how the IoT can impact their respective business domains, and agree on actionable business scenarios that will require deep collaboration between them."
Aside from the many opportunities that the IoT will bring to every business, the sheer volume of information being collected will create risks for legal, regulatory and reputational exposure. The role of the enterprise architect is not only to create new ideas and scenarios, but to assess properly the impact in terms of what information will be generated, what the most important information is and how it can be protected, if necessary.
"Organisations must understand the profound impact new sources of information will have" said Walker. "Enterprise architects are best positioned to discuss and enable the most lucrative opportunities in partnership with business units and IT leaders. At the same time, they must work with chief data officers and security officers to structure these data in a way that mitigates the worst risks of pursuing these opportunities."