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The Services Research Company™

Oliver MarksVP Research Digital & IoT [email protected]

HfS Blueprint Report

Internet of Things (IoT) ServicesExcerpt for CognizantOctober 2016

Proprietary│Page1©2016HfSResearchLtd.ExcerptforCognizant

Table of ContentsTOPIC PAGE

ExecutiveSummary 2

Key MarketDynamics 10

Research Methodology 21

ServiceProviderAnalysis 26

Market DirectionandRecommendations 33

AbouttheAuthorandHfSResearch 39

Executive Summary

Proprietary│Page3©2016HfSResearchLtd.©2016HfSResearchLtd.ExcerptforCognizant

Introduction to the HfS Blueprint Report: Internet of Things (IoT) Servicesn TheInternetofThings(IoT)ServicesHfSBlueprintReportreviewstheemergingvaluechainof

servicesdevelopingfromprovidersthatareaddressingthispotentiallyhugeandtransformativetechnology.

n Unlikeotherquadrantsandmatrices,theHfSBlueprintidentifiesrelevantdifferentialsbetweenserviceprovidersacrossanumberoffacetsintwomaincategories:innovationandexecution.HfSemphasizestheemergingnatureoftheIoT,with55%ofthetotalBlueprintscoringlinkedtoinnovation-basedevaluationcriteria.

n TheHfSBlueprintincludesprofilesandassessmentsof17serviceprovidersofIoTServices.

n Wedisplayourassessmentsofthe17serviceprovidersontheHfSBlueprintGrid.

n TheHfSBlueprintGridrecognizesprovidersinthefollowingcategories:HighPotentials—up-and-comingserviceprovidersthatscoredhigheroninnovationcriteriathanonexecutioncriteriaastheybuildtheirpractices.ExecutionPowerhouses—established,high-executionserviceprovidersthathavebuilteffectivedeliveryoperationsbutneedtoinnovatetheircapabilitiesandofferingsfurther.HighPerformers—serviceproviderswithstrongcombinedinnovationandexecutionperformance.Winner’sCircle—serviceproviderswiththehighestoverallperformance.


HfS Definition of Internet of Things (IoT) Services

HfSDefinesIoTServicesas:

1. Datastreamstoandfromconnectedphysicaldevices2. Deliveryofdatafromandtocentralizedrepositories

bythesephysicaldevicesforadditionalinteractions.

Note:Thedevicesdeliveringthedatamayormaynotcreatethedatathemselvesandmayormaynotprocesstheinformationbeforedeliveringit.Thedevicescanbeintelligentordumb—rangingfromanitemtaggedwithanRFIDchipthatiscodedwithauniqueidentifiertoalargesophisticatedheavyindustrialmachinewithsensorsthatmonitorandcontrolallaspectsofoperation,output,andhealth.Further,communicationofdatamaybedoneviavariouscombinationsofwiredand/orwirelessnetworks.Thesenetworkscanbeeitheropenorprivate,andwhilethiscommunicationisoftencarriedoutviaIPprotocol,itisnotarequirement.Asaresult,theIoTincludesabroadsetofactivities,someofwhichhavebeenusedfordecadesinindustrialcontrol.

HfSdefinesIoTServicesasdigitalstrategyandtacticalexecutiontosolvebusinessproblems,increaseoperationalefficiencies,and/orcreatenewmarketsbyleveragingdatatoandfromconnectedphysicaldevices(“things”)andthedigitalcore.ThedigitalcoreistypicallyablendoflegacyITinfrastructureandmoderndigitaltoolsandtechnologies.

IoTServicesdesign,deploy,andenableinteroperabilitywithconnected“things”asanaspectofanoverarchingapproachtosolvingbusinessproblemsforclientsandpartners,rangingfrominnovation,conception,andexecutionthroughtooperationalsupportandmaintenance.


Key Highlights: The State of the IoT Services Market

n TherearetwodistinctIoTdevelopmentareas:WheretheIndustrialInternetusageofIoThasastrong,maturestandardsandinteroperabilityservicesculturerootedinITworkflowlogic,theIoTwillbeemerging,mutating,andevolvingfortheforeseeablefuture,makingithardforservicescompaniesofalltypestocoalesceteamsaroundrepeatableprocesses.

n IoTServices requiresmultipleskillsetsworkingtogether:TheIoTbridgesmultiplecompetenciescurrentlyhousedwithindifferentserviceproviderpracticelines.Business/digitalstrategy,telecom/mobility,cloud,userexperience,engineering,analytics,andsecurityareblendedinagileteamsforclientsafterstrategicintentsandgoalsaredefined.Forbuyers,executionsecurityandinteroperabilitycompetenciesaretablestakesforconsideration.Theabilityofparticipantstounderstandthebusinessvalueofexecutioniscriticalforsuccess.

n IoTisaningredientofbroaderdigitalinitiatives: Agreatdealofcurrentactivityfocusesonstrategy,innovation,andplanning,essentialbeforefocusingonexecution.Theabilitytogenerateandgatherdataonanever-broaderrangeofphysicalassetsandinteractionswillyieldvalueonlyifactionableinsightsyieldclearbusinessvalue.Servicesprovidersareexpectedtoparticipateinthesestrategicstages.

n IoTopportunitiesrequirecompetitorstocollaborate:Digitalplatformsthatintegratedatafrommultiplesourcesaresoughtaftertoyieldthegreatestandbroadestcontiguousvalues.IoTpointsolutionsareoflittleusetobusinessiftheycannotinteroperate,unlesstheysolveaveryspecificpainpoint.


Key Highlights: The State of the IoT Services Market (continued)

n Thedigitaleconomyisforcingchangeonlegacybusinesses:ThereisonlysofarwecanpushlegacyITasaplatformforthescaleofdataandinformationflowsenabledbytheIoTandotherinitiatives.Atthesametime,therearehugebusinesspressuresfromnewerdigitalcompetitors,forcingmaturebusinessestolookhardatre-platformingtoaccommodatetheIoTandotherdigitaldataflows.

n Thesecretive,competitivenatureofIoTplanningobscuresmarketperceptions:Althoughindustrialefficienciescasehistoriesarecommonplace,fewofthevendorsanalyzedinthisBlueprintcouldpubliclydiscussthemoreinnovativeclientworktheywereworkingon.ThistendstoskewperceptionoftheIoTtoindustrialsensordataflowsandheavilymarketedservicesandtools.Proofsofconceptandpilotprojectsarealsooftenheavilypublicizedtogaintractioninthemarketplaceandjustifybudgetingdecisions,whereactualwell-fundedinitiativestendtobekeptundertightwraps.

n Securityfoundations:Acrosstherapidlyevolvingdigitallandscape,end-to-endsecurityiscriticalandisakeyvaluepropositionforallserviceproviderpartnerships.TheIoT’schaoticevolutioncontinuestobefullofpotentiallyexploitablepiecemealcomponentsthatcouldbedangerousplatformpointsofentryforhackers.Thischallengeslowsdevelopmentbutisessentialforresponsibleinnovationandbusinessstrategyrollout.

n Accessibleandactionabledataviaplug-and-play digitalservices:InnovativeIoTbusinessusesareanexcellentexampleofthe“borndigital”next-generationtechnologiesbeingleveragedtodrivemodernbusinessthinking.


IoT Services Value ChainIoTServicesarethosethatdesign,create,andmanageapathwayforthephysicalworldtoentertheAs-a-ServiceEconomybycreatingabridgebetweenhardgoods(andservices)anddigitalinfrastructure.

IoTServices,however,donotincludethefollowingactivitieswhenconductedasastandaloneservice:deployingoroperating analytics,implementingorrunningadatarepository, developingordeliveringanetwork, andcreatingormaintainingaphysicaldevicewiththecapacitytocreateand/orcommunicatedata.ThosestandaloneactivitieswouldbeclassifiedasAnalytics,BigData,NetworkImplementation,andProductEngineeringServices,respectively.

IoTCONSULTING

• Strategicplanningandbusinesscasedevelopment

• Governancestrategy• IoTtechnologyroadmap(referencearchitecture)

• Securitystrategy• Datatransportandtelecomcostconsulting

IoT ENABLEMENT

• Productengineering• Sensordevelopment• Softwareengineering• Embeddedtech• Devicesecurity• CustomAppDev(dashboards,visualization,etc.)

• Physicalprototypingof“things”

IoT CONNECTIVITY

• Networkengineering• Networkimplementation

• Networksecurity• Telecom

IoT INTEGRATION

• Databasedesignandbuild

• AnalyticsImplementation

• Systemintegration• Applicationmodernization

• Security

IoT MANAGEMENT

• Devicemanagement• Cloudhosting• Networkmanagement• Datasecurity


IoT Service Value Chain by Overall Current Supplier Maturity

IoTCONSULTING IoTENABLEMENT IoTCONNECTIVITY IoTINTEGRATION IoTMANAGEMENT

Strategic PlanningandBusinessCaseDevelopment

ProductEngineering

NetworkEngineering

Database DesignandBuild

DeviceManagement

GovernanceStrategy

SensorDevelopment

NetworkImplementation Analytics Implementation Cloud

Hosting

IoTTechnologyRoadmap(Reference

Architecture)

SoftwareEngineering

NetworkSecurity

SystemIntegration

NetworkManagement

CustomDevelopment EmbeddedTechnology

ApplicationModernization

DataSecurity

DesignThinking DeviceSecurity

Mature Competitivemarket withexamplesofserviceofferingsandcustomercasestudiesfromalargenumberofserviceproviders

Nascent Marketindevelopment withlimitedexamplesofserviceofferingsandevidence ofactivities


n As-a-ServiceWinnersareserviceprovidersthatarebeingentrepreneurialalongsideclientsandinnovatinginbothIndustrialInternetandIoTactivities,buildingnewmarkets,paradigms,digitalsystems, anddataflowsaroundabreadthofdifferenttypesofconnecteddevices.Accenture,Atos,Cognizant,EPAM,Harman,IBM,HCL,TCS,TechMahindra

n TheHighPerformers allexecutewellaroundolderIndustrialM2Mmodels,andareexploringandinvestinginnewerIoT.Evolvingdemonstrationofmoretractionwithclientsindefininganddeliveringatscaleagainstbusinessoutcomesandco-innovation.

Dell,Infosys,NTTDATA,NIITTechnologies,Syntel,Tieton ExecutionPowerhouses Thiscategoryhasdeeppedigrees

andcompetenciesinIndustrialInternetworkataglobalscale,withtremendousresourcesbutislackinginmodernIoTinnovationandentrepreneurship.Genpact,Luxoft

n VirtusaPolarishasHighPotential withpost-mergergrowthshowingpromisethroughrapidmaturationasamodernIoTplayer.

AS-A-SERVICEECONOMY

Useofoperatingmodels,enablingtechnologies,andtalenttodrivebusinessoutcomesthroughoutsourcing.Thefocusisonwhatmatterstotheendconsumer.

HfSusestheword“economy”todescribethenextphaseofoutsourcingasanewwayofengagingandmanagingresourcestodeliverservices.

The8IdealsoftheAs-a-ServiceEconomy:1. Write OffLegacy2. DesignThinking3. CollaborativeEngagement4. BrokersofCapability5. IntelligentAutomation6. AccessibleandActionableData7. Holistic Security8. Plug-and-PlayDigitalServices

Source:BewareoftheSmoke:YourPlatformIsBurningbyHfSResearch,2015

State of the Market: Service Providers

Key Market Dynamics


The Rapidly Changing Face of Business Strategy, Associated Technologies and the Services that Are Sought AfterInourcurrenthigh-stakesbusinessera,whendigitalischangingallaspectsofdailylivesandbusinessmodels,theInternetofThings(IoT)stilllargelyhastwodimensions.TheIndustrialInternetoriginatedintheearlydaysofconnectivityandhasevolvedtowhatEuropeansnamed“Industry4.0”—arobustsetofstandards,technologies,andgovernancemodelsforsensorfeedbackfromequipmentandbuildingstomonitoroperationalefficienciesandhealth.

WheretheIndustrialInternet’srootsinthelastcenturylargelyassociateitwiththatera’senterpriseITlogicandworkflows,theIoThasexplodedontotheworldstageinatsunamiofhyperboleandredherrings,asistypicalwithemergenttrendsandtechnologies.TheIoTisfundamentallyanattributeofthedigitaltoolkit(mobility,cloud,bots,dataflows,andanalytics,humancollaborationandexperiences,security,payments,governance),andasaningredientindigitalbusinessplanshasvaryinglevelsofimportancedependingonbusinessgoalsandneeds.

WheretheIndustrialInternetisnowpartofthefabricofourlivesandthebedrockfornewerincrementaldevelopments,suchassmartcitiesandcars,IoTbusinessmodelsareevolvingveryfastforcommercialvalueapplications,bothasproductsandascountlesstuck-instoexistinginformationflowsandprocesses.Atangibleexampleisthespeedwithwhichdronesemergedandbecameahugeconsumermarket,aninvaluablevisualinspectiontool,andanoriginatorofgigabytesofdatathatneedtobeprocessedandstored.


The Rapidly Changing Face of Business Strategy, Associated Technologies and the Services that Are Sought After, continued

Dronesareoneexampleofthespeedatwhichdatacreation“things”andtoolsemergeandbecomepartofdailylife—anda$127billionmarketby2020accordingtoPwCdata.

LIDAR(aradar-likedetectionsystemthat“sees”usinglightfromlasers)willguidethenextgenerationsofdronesawayfrompowerlinesandotherobjects,allowingformanymoreautomaticusemodels.Thecommercialusesforthesetoolsandthedatatheycapturearewidespread,partofcountlessbusinessmodelsandleveragedineffortstocreateautonomousvehicles.

Currently,theIoTisanevolvingmassofcompetingstandards,securityconcerns,andinteroperabilityissues,withtransportationviamobilespectrum/G5,low-powerwideareanetworks,andsensortechnologiesalsoatvaryingemergentstagesofevolution.

Noneofthelegacyplayersinbusiness,IT,marketing,andlegalconsultinghavestrongbroadskillsetsindigitalstrategicandtacticalthinking,andthereisavacuumforcrediblepartnerstobusiness.Abroadmarketshiftfocusedondigitalinnovationandexecutioniscreatinganewgenerationoftrustedpartners,while someofthelegacythinkingplayerswillloserelevanceorbepushedtocommodityproviderstatus.

ThisreportfocusesoninnovationandexecutioncompetenciesaroundtheIoTwithinthebroadercontextofdigitaldemands,strategies,andtechnicalexecutionsophistication.


FixedAssetsLeveragedAssets

2DesignThinking

3BrokersofCapability

1WriteOffLegacy

4CollaborativeEngagement

7HolisticSecurity

5IntelligentAutomation 6

Accessibleand

ActionableData

8Plug-and-PlayDigitalServices

SOLUTIONIdeals

LEGACYECONOMY

AS-A-SERVICEECONOMYCHANGEMGMT

Ideals

§ MovingintotheAs-a-ServiceEconomymeanschangingthenatureandfocusofengagementamongenterprisebuyers,serviceproviders,andadvisors.

§ “As-a-Service”unleashespeopletalenttodrivenewvaluethroughsmartercombinationsoftalentandtechnologyfocusedonbusinessresultsbeyondcostreduction.

Journey to the As-a-Service Economy

©2016HfSResearchLtd.ExcerptforCognizant

TOOLS/INFRASTRUCTURE GOVERNANCE

IoT As-a-Service Economy: Ideal Provider Attributes HfSusestheword“economy”toemphasizethattheemergingnextphaseofoutsourcingisamoreflexible,outcome-focusedwayofengagingandmanagingresourcestodeliverservices.OperatingintheAs-a-ServiceEconomymeansarchitectinguseofincreasinglymatureoperatingmodels,enablingtechnologiesandtalenttodrivetargetedbusinessoutcomes.Thefocusisonvaluetotheconsumer.

I.THEOPTIMUMOPERATINGMODEL

Outsourcing|SharedServicesGBS|BPaaS/SaaS/IaaS|Crowdsourcing

II.EMPOWERINGTALENTTOMAKEITALL

POSSIBLECapabilitiesoverSkills|

DefiningOutcomes|Creativity|DataScience

IV.TECHNOLOGYTOAUGMENTKNOWLEDGELABOR

DigitizationandRoboticAutomation|Analytics|Mobility|SocialMedia|CognitiveComputing

III.ABURNINGPLATFORMFORCHANGE

GlobalizationofLabor|High-GrowthEmergingMarkets|

DisruptiveBusinessModels|Consumerization

AS-A-SERVICEECONOMY

Agility|CollaborationOne-to-Many|OutcomeFocus

Plug-and-PlayServices


IoT Service Provider Innovation and Execution Journey

15-year-oldIndustrialInternetLocalsensordatafromdevices

InnovationoutsideIndustrialInternetmodelsconnectingdatatotherestofthebusinessandpartnerecosphere

FullyconnectedenterprisewithIoTattributesfeedingdatatoandfroma‘digitalcore’

Examples:Fullyintegrateddigitalbusinessentitywithglobalconnectivity,processes, andcustomerrelationships- Amazon- AppleComputer

ManyCPGfirms- Fintechfirms

EvolutionoftheIndustrialInternettoIndustry4.0

BuyersshouldbeawareserviceprovidershaveverydifferentinnovationandexecutionstrengthsandweaknessesacrossIoTandIndustry4.0strategic,tactical,andtechnicalskillsets,anddifferenttechnologyplatformpartnerallegiances.

Execution

Inno

vatio

n

LEGACYECONOMY

AS-A-SERVICEECONOMY

Examples:LegacyserialporteraindustrialcontrolmechanismsLimitedconnectivityanddataflows- Oil&Gas- Manufacturing- Olderheaviertechnologies

Examples:Smartfactoriesandheavyequipmentwith“localonly” dataflows.MultipleIoTpointsolutions.Muchgreaterconnectivity,moremodernroboticequipment- Oil&Gas- Manufacturing- Modernheavytechnologies

Examples:Real-timedatafromflowtoandfrommanufacturing,servicesinconnected“oneconnecteddevicesoffice”environment- Consumermanufacturingofsmartproducts- Smartvehicles,equipmentwithstrongsupport,

self-healingattributes


IoT Innovation and Execution Data Flow IdealsThe IoTflowstoCoreDigitalDataflowsfromsmartobjectsintotheircontrollingorganization’sdigital“backbone”core,whereitisanalyzed,distributed,androutedtorelevantsystemsandpeople

Execution

Inno

vatio

n

AS-A-SERVICEECONOMY

Security

LegacyIT

LEGACYECONOMY

DataLake

DigitalCo

re

IndustrialInternet

InternetofThings

Otherdigitalattributes

Real-timeintelligence,Analytics

DesiredbusinessOutcomes,valuetocustomer


The Eight Ideals of the Broader As-a-Service Economy

LEGACYOUTSOURCING AS-A-SERVICEECONOMYIntelligentSimplification

Legacytechnologyinvestments thatlimitagilityandcreate massesofexceptionsaddressedthroughaddinginternalandexternalFTEs

1.WriteOff Legacy

Usingplatform-basedsolutions,DevOps,andAPIecosystemsformoreagile,lessexception-orientedsystems

Resolving problemsbylookingfirstattheprocessasthesourceofthesolution

2.Design Thinking

Understandingthebusinesscontexttoreimagineprocessesalignedwithmeetingclientneeds

Focusinggovernancestaffonmanaging totheletterofthecontractandthedecimalpointsof

servicelevels

3.Brokers ofCapability

Orientinggovernance tosourceexpertisefromallavailablesources,bothinternallyandexternally,toaddresscapabilitygaps

Evaluating relationshipsonbaselines ofcost,effort,andlabor

4.Collaborative Engagement

Ensuring relationshipsarecontractedtodrivesustainedexpertiseanddefinedoutcomes

Operatingfragmented processesacrossmultipletechnologieswithsignificantmanual

interventions

5.Intelligent Automation

Using ofautomationandcognitivecomputingtoblendanalytics,talent,andtechnology

Performing ad-hocanalysisonunstructureddatawithlittleintegrationorbusinesscontext

6.Actionable andAccessibleData

Applyinganalyticsmodels,techniques,andinsightsfrombigdatainrealtime

Respondingwith post-event fixes;littlefocusonend-to-endprocessvaluechains

7.Holistic Security

Proactivelymanagingdigitaldataacrosstheservicechainofpeople,systems,andprocesses

Undertakingcomplex,painfultechnologytransitionstoreachsteadystate

8.Plug-and-PlayDigital BusinessServices

Plugginginto“readytogo”business outcome–focused, people,process,andtechnologysolutionswithsecuritymeasures


How IoT Services Play in the As-a-Service EconomyIDEAL AS-A-SERVICE

IDEALDEFINITIONEXAMPLE

WriteOffLegacyUsingplatform-basedsolutions,DevOps,andAPIecosystemsformoreagile,lessexception-orientedsystems

Pullingrelevant dataflows fromring-fencedlegacysystemstocontributetothedigitalcoreinordertodrivemodernbusinessmodels

DesignThinkingUnderstandingthebusinesscontexttoreimagineprocessesalignedwithmeetingclientneeds

IdentifyingbusinessmodelsthatleverageIoTattributes todrivenewmarketsandcostsavings

Brokers ofCapability


AssemblingfitforpurposeAs-a-Servicedigitalplatformframeworksto enablemodernbusinessdataflowstoandfromIoTcomponents

CollaborativeEngagement

Ensuring relationshipsarecontractedtodrivesustainedexpertiseanddefinedoutcomes

TheIoT contributesstructureddatatounstructuredcollaborativeframeworksacrossbroadecospheresaroundbusinessoutcomes

AccessibleandActionableData

Applyinganalyticsmodels,techniques,andinsightsfrombigdatainrealtime

TheIoTprovidesanewlevelanddepthofdataflowsthatrequireasophisticatedAs-a-Service cloudinfrastructurethatenablesreal-timeactionableintelligence

HolisticSecurityProactivelymanagingdigitaldataacrosstheservicechainofpeople,systems,andprocesses For theIoT,securingdatawithinsophisticatednetworksiscriticaltosuccess

Plug-and-PlayDigitalBusinessServices

Plugginginto“readytogo”business outcome–focused, people,process,andsolutionswithsecuritymeasures

Ecosphere thatrunsonan agiledigitalcorethatallowsandaccommodatesrapidtechnologychangesandenablesdataflowincreasesandrerouting


IoT Solution Examples Across VerticalsINDUSTRY VERTICALS EXAMPLES

Aerospace ConnectedAerospace,Connected RepairSolutions

Automotive&Transportation ConnectedCar,Insurance Telematics,FleetManagement,ConnectedShip,InteractiveGeospatialSolution,ConnectedEVStations,PredictiveAnalyticstoReduceMaintenanceandWarrantyCosts

Manufacturing ConnectedAssetManagement,ConnectedWorkers,RemoteDiagnosticand Predictive MaintenanceforIndustrialMachines,StolenAssetRetrieval,TransparentSupplyChain,ConnectedShopfloor

Buildings ConnectedHome,SmartEnergy,ConnectedBuilding,ConnectedSecurity

Agriculture PrecisionFarming,FarmtoFork

Consumer Electronics SmartWearables,Subscription EnablementPlatform,AuthenticationApplicationsforWearables

Urban Infrastructure Smart Parking,SmartLight,SmartBin,SmartWaste,DigitalUndergroundMapping,Infrastructure Monitoring,BridgeMonitoring

Healthcare&LifeSciences ConnectedHealthcare,HealthFacilityWayFinding, VirtualCarePlatform,PatientEngagementPlatform,ConnectedPatient,EmergencyManagement

Oil&Gas DigitalOilField,SmartDrilling,SmartOilTransportation,SolarandWindPowerMonitoring

Utilities SmartGrid,SmartMetering,ConnectedPowerPlant,ConnectedSolarFarm,ConnectedWindFarm

Mining&Resources ConnectedMines,Connected SupplyChain

BFSI Cryptocurrency,BlockChainAssetManagement,BeaconsforCommerce


IoT Solution Examples by Verticals: Innovation/Entrepreneurial vs. Execution

INDUSTRY VERTICALS EXAMPLES

Aerospace ConnectedAerospace,Connected RepairSolutions

Automotive&Transportation ConnectedCar,Insurance Telematics,FleetManagement,ConnectedShip,InteractiveGeospatialSolution,ConnectedEVStations,PredictiveAnalyticstoReduceMaintenanceandWarrantyCosts

Manufacturing ConnectedAssetManagement,ConnectedWorkers,RemoteDiagnosticand Predictive MaintenanceforIndustrialMachines,StolenAssetRetrieval,TransparentSupplyChain,ConnectedShopfloor

Buildings ConnectedHome,SmartEnergy,ConnectedBuilding,ConnectedSecurity

Agriculture PrecisionFarming,FarmtoFork

Consumer Electronics SmartWearables,Subscription EnablementPlatform,AuthenticationApplicationsforWearables

Urban Infrastructure Smart Parking,SmartLight,SmartBin,SmartWaste,DigitalUndergroundMapping,InfrastructureMonitoring,BridgeMonitoring

Healthcare&LifeSciences ConnectedHealthcare,HealthFacilityWayFinding, VirtualCarePlatform,PatientEngagementPlatform,ConnectedPatient,EmergencyManagement

Oil&Gas DigitalOilField,SmartDrilling,SmartOilTransportation,SolarandWindPowerMonitoring

Utilities SmartGrid,SmartMetering,ConnectedPowerPlant,ConnectedSolarFarm,ConnectedWindFarm

Mining&Resources ConnectedMines,Connected SupplyChain

Banking, FinancialServices,Insurance

Cryptocurrency,BlockChainAssetManagement,BeaconsforCommerce

Innovative/Entrepreneurial UsingDesignThinking, broaderbusinessstrategytodrivenewideasandmarkets

Execution Increasedfocus onIndustry4.0controlsystems,sensor,anddataflowtechnicalevolution

Research Methodology


Research Methodology

n Morethan1,080datapointswerecollectedfrommorethan56IoTServicescontracts,covering18majorserviceproviders.Therewereothers(suchasHPandCapgemini)whoseIoTserviceofferingsarestillevolvingandwerenotyetinapositiontobeincludedbutonwhichwewillreportlater.

n DatawascollectedinQ2-Q32016,coveringbuyers,providers,andadvisors/influencersofIoTServices.

§ TalesfromtheTrenches:Interviewswithbuyerswhohaveevaluatedserviceprovidersandexperiencedtheirservices.Somecontactswereprovidedbyserviceproviders,andotherswereinterviewsconductedwithHfSExecutiveCouncilmembersandparticipantsinourextensivemarketresearch.

§ Sell-SideExecutiveBriefings:Structureddiscussionswithserviceprovidersregardingtheirvision,strategy,capability,andexamplesofinnovationandexecution.

§ PubliclyAvailableInformation:Thoughtleadership,investoranalystmaterials,websiteinformation,presentationsgivenbyseniorexecutives,industryevents,etc.

ThisReportIsBasedOn:

ParticipatingServiceProviders

DataSummary


HfS Blueprint Scoring: IoT Services Scoring Percentage Breakdown

EXECUTION 45%Quality ofCustomerRelationships 15%

QualityofAccountManagementTeam 5%HowServiceProvidersIncorporateCustomerFeedback 10%

Real-WorldDelivery Solutions 20%ProprietaryDeliveryModels 15%StandardDeliveryMethods 5%

FlexiblePricingModelstoMeetCustomerNeeds 10%

INNOVATION 55%FutureAlignmentwithChangingMarket 25%

AcquisitionandInvestment Strategy 5%Partnership Ecosystem 10%Collaboration andDevelopmentTechniques 10%

StrengthofVisionforIoTServices 15%

AbilitytoGoBeyondStage1(Digitization) withtheIoT 15%CreationofProprietaryFrameworksforAnalyzingNeeds 5%IndustryExperience 10%

TOTAL 100%


Blueprint Scoring Definitions: Innovation

INNOVATION Innovationisthecombinationofimprovingservicesandbusinessoutcomes.

FutureAlignmentwithChangingMarket Howfuturelookingistheserviceproviderintermsofaligningitself—inskillsandofferings—withtheevolvingmarketdemand?Isitkeepingpace,is itafastfollower,orisitleadingtheway?

AcquisitionandCapabilityDevelopment Howdoestheserviceproviderincorporate capabilitydevelopmentinvestments,includingacquisitions,intoitsstrategy,andwhathasbeenaccomplishedalready?

Partnership Ecosystem Whatis theroleofpartnershipsinthedevelopmentoftheserviceprovider’ssolutionecosystem?Howextensiveisthecurrentpartnershipecosystem?

CollaborationTechniques HowwelldoestheserviceprovidercollaboratewithclientsandpartnerstodevelopPoCsintofull-scalebusinesssolutionsandIoTofferings?

StrengthofVisionforIoTServices DoestheserviceproviderhaveastrongvisionforservicesacrosstheIoTvaluechain?

AbilitytoGoBeyondStage1withtheIoT Howwellhas the serviceproviderintegratedinnovativeapproachesandemerging skillsandtechnologiesintoservices?DoesitalsobringthecoretechnologyplatformtoassistanenterpriseindeployingthenextlevelofIoTsolutions?

CreationofProprietaryFrameworksfor AnalyzingNeeds

What,ifany,proprietaryframeworksdoestheserviceproviderutilizetoanalyzethe underlyingbusinessneed?

IndustryExpertise Doestheserviceprovider haveanyindustryIoT-specificofferings?Ifso,what arethenatureofthese,andhowfaradvancedisitinbuildingthisareaout?


Blueprint Scoring Definitions: Execution

EXECUTION Howwelldoestheserviceproviderexecuteonitscontractualagreement,andhowwelldoestheserviceprovidermanagetheclient–providerrelationship?

QualityofCustomerRelationships Howengagedareserviceprovidersinmanagingtheclientrelationshipbasedonthefollowingmetrics:qualityofaccountmanagement,serviceprovider/clientengagement,andincorporationoffeedback?

QualityofAccountManagementTeam Whatisthequalitylevelofprofessionalskillsintheaccountmanagementteam?

HowServiceProvidersIncorporateCustomerFeedback

Howhaveserviceproviderstakenfeedbackandincorporatedthatfeedbackintoofferings?

Real-WorldDeliverySolutions Doesthesolutionprovidedcomparefavorablytopeersregardingvaluecreationthroughcurrentofferings,partnerships,subjectmatterexpertise,anddeliverymodels?

ProprietaryDeliveryModels What, ifany, proprietarysoftwareplatformsandprocessstructureshastheserviceprovidercreatedtodelivertheseservices?

StandardDeliveryMethods What,ifany,standardsoftwaretoolsandbusinessplatformsdoestheserviceproviderutilizetodelivertheseservices?

FlexiblePricingModelstoMeetCustomerNeeds

Howflexiblearetheserviceproviderswhendeterminingpricingofcontracts?HavetheserviceprovidersalignedthesetermswiththeuniquedemandsofIoTprojects?

Service Provider Analysis


TodistinguishserviceprovidersthatshowcompetitivedifferentiationinaparticularlineofdeliverywithprogressinrealizingtheAs-a-ServiceEconomyofbusinessoutcome-oriented,on-demandtalentandtechnologyservices,HfSawardstheseproviderstheAs-a-ServiceWinner’sCircledesignation.

Guide to the Blueprint Grid

EXECUTION INNOVATION

As-a-ServiceWinner’s Circleshowexcellencerecognizedbyclientsinthe8Idealsin executionandinnovation

Collaborativerelationshipswithclients,servicesexecutedwithacombinationoftalentandtechnology asappropriate,andflexiblearrangements.

Articulatevisionanda“newwayofthinking,”haverecognizableinvestmentsinfuturecapabilities,strongclientfeedback,and aredrivingnewinsights andmodels.

HighPerformersdemonstratestrongcapabilitiesbutlackaninnovativevisionormomentuminexecutionofthevision

Executesomeofthefollowingareaswithexcellence:worthwhilerelationshipswithclients,servicesexecutedwith“greenlights,”andflexibilitywhenmeetingclients’needs.

Typically, describeavisionandplanstoinvestinfuturecapabilitiesandpartnershipsforAs-a-Service,andillustratean abilitytoleveragedigitaltechnologiesand/ordevelop newinsightswithclients.

High Potentialsdemonstratevisionandstrategybuthaveyettogainmomentuminexecutionofit

Earlyresultsandproof pointsfromexamplesinnewserviceareasorinnovativeservicemodels,butlackscale,broadimpact,andmomentuminthecapabilityunderreview.

Well-plotted strategyandthoughtleadership,showcaseduseofnewertechnologiesand/orroadmap,andtalentdevelopmentplans.

ExecutionPowerhousesdemonstratesolid,reliableexecutionbuthaveyettoshowsignificantinnovationorvision

Evidence ofoperationalexcellence;however,stillmoreofadirectiveengagementbetweenaserviceprovideranditsclients.

Lessevidentvisionandinvestmentinfuture-orientedcapability,suchasskillsdevelopment,“intelligentoperations,”ordigitaltechnologies.


HfS Blueprint Grid: Internet of Things (IoT) 2016INNOVA

TION

EXECUTION

ExcellentatInnovationandExecutionInvestinginInnovationtoChange

BuildingAllCapabilities ExecutionIsAheadofInnovation

AS-A-SERVICEWINNER’SCIRCLE

EXECUTIONPOWERHOUSES

HIGHPOTENTIALS

HIGHPERFORMERS

CognizantHarman

TechMahindra

NTTData

Infosys

DellServices

EPAM

Luxoft

VirtusaPolaris

IBM

AccentureAtos

Syntel Tieto

NIITTechnologiesGenpact

TCS

HCL


Major Service Provider Dynamics: HighlightsEXECUTION

• Buyingdecisionsareofteninfluencedbycomparingpricingflexibilityandco-investmentoptionswith sharedrisksandrewards.BuyerscitedIBM,Harman,TCS,and Tietoforflexibility,whileAccenture,Atos,NTTDATA, and TechMahindraAs-a-ServicepricingforIoTisconsideredforward-thinkingforsubscription-basedpromisedoutcomesovertime.

• Decisionmakingabout proprietaryand/oropensourcestandardsiscriticalfor the IoT,particularlyforinteroperabilitywithlegacysystems.Vendorsthatcollaboratewithpartnersandclientsareimportant,with Cognizant,EPAM, Genpact,andNIIT receivingkudosforworkingcloselywithclients.

• Tie-instolarger“systemsofintelligence”whereIoTdataflowstoandfromlargercoredigitalenterprisesystemsaspartofbroaderdigitalstrategiesrequiresophisticatedstrategyandsuppliers.Accenture,Atos,IBM,and Infosyswereconsideredparticularlycapableatthislevelofexecution.

INNOVATION

• BecausetheIoTistypicallyasubsetofabroaderbusinessstrategy,manysuppliershavepurchaseddesignandideationfirms(TechMahindrapurchasedPininfarina,Cognizant Designit asexamples)tomoveupthestrategyandinnovationvaluechainaroundbroaderdigitalconstructs.Howwelltheseadd-instolargeITorganizationsworkinthecontextofclientstrategicneedsrequiresclosescrutiny.Accenture currentlyhaveatacticaladvantage sincetheyarealreadytrustedstrategicadvisors.

• Innovationinthe IndustrialInternetevolutioninheavymachineryisverydifferentfromthemoreinterconnecteddigitalworld.Harman,Atos, and Luxoftarewellestablishedinthesmartcarstandardsecosphere,forexample,butothersmayhavegreateragilityinentrepreneurialconnectedproductefforts,dependingonbusinessgoals,needs,andscale.

• Where theOil&Gas, Utilities,andMining&Resourcesverticalsarefocusedonmodestinnovationwithincomplexlegacyindustrialframeworks,innovationinconnectedsmart“things”areonaverydifferenttrajectorywhereproof-of-valueexperimentationiscommon.Itisunfairtocalloutspecificsuppliersheregiventheirdifferentdimensionsofinnovation.


IoT Services Value ChainIoTServicesarethosethatdesign,create,andmanageapathwayforthephysicalworldtoentertheAs-a-ServiceEconomybycreatingabridgebetweenhardgoods(andservices)anddigitalinfrastructure.

IoTServices,however,donotincludethefollowingactivitieswhenconductedasastandaloneservice:deployingoroperating analytics,implementingorrunningadatarepository,developingordeliveringanetwork,andcreatingormaintainingaphysicaldevicewiththecapacitytocreateand/orcommunicatedata.ThosestandaloneactivitieswouldbeclassifiedasAnalytics,BigData,NetworkImplementation,andProductEngineeringServices,respectively.

KeytoServicesMaturityontheServiceProviderProfilePages

MaturityisbasedonthefullsetofweightingcriteriaforIoTServices,andthefiveboxesarethefiveareasofthevaluechain.

LessMatureServices

MoreMatureServices

ReliesonPartners

IoTCONSULTING

• Strategicplanningandbusinesscasedevelopment

• Governancestrategy• IoTtechnologyroadmap(referencearchitecture)

• Securitystrategy• Datatransportandtelecomcostconsulting

IoT ENABLEMENT

• Productengineering• Sensordevelopment• Softwareengineering• Embeddedtech• Devicesecurity• CustomAppDev(dashboards,visualization,etc.)

• Physicalprototypingof“things”

IoT CONNECTIVITY

• Networkengineering• Networkimplementation

• Networksecurity• Telecom

IoT INTEGRATION

• Databasedesignandbuild

• AnalyticsImplementation

• Systemintegration• Applicationmodernization

• Security

IoT MANAGEMENT

• Devicemanagement• Cloudhosting• Networkmanagement• Datasecurity

NotMature

LessMature

MoreMature

KeytoFourStrengths/WeaknessesontheServiceProviderProfilePages:Innovation,Execution,Industrial,andEntrepreneurial


The Current Maturity of Service Provider IoT Service Offerings and Capabilities

CONSULTING ENABLEMENT CONNECTIVITY INTEGRATION MANAGEMENT

Accenture

Atos

Cognizant

Dell

EPAM

Genpact

Harman

HCL

IBM

Infosys

Luxoft

NIITTechnologies

NTTDATA

Syntel

TCS

TechMahindra

Tieto

VirtusaPolaris

LessMatureServices

MoreMatureServices

ReliesonPartners

KeytoServicesMaturityontheServiceProviderProfilePages

NotMature

LessMature

MoreMature

KeytoFourStrengths/WeaknessesontheServiceProviderProfilePages:Innovation,Execution,Industrial,and Entrepreneurial


CognizantIoTservicesfitintobroaderdigitalvisionandnext-genITenterprisefollow-throughwithstrongentrepreneurialdriveWinner’s Circle

Service DeliveryOperations Client Profile Acquisitions/Partnerships ProprietaryTechnologies/Platforms

Headcount: IoTStrategyabout200, IoTDeliveryabout2700;about 2000additionaldistributedresources,e.g.,InformationManagementteamAnalyticsand datascientists,mobiledevelopers,IoTTesting.OrgStructure:TheIoTpracticecombinesProductEngineering,IoTConsulting,IndustrySolutions,andIoTPlatformsispartofCognizantDigitalWorks.DeliveryNetwork:20%US,UK,Netherlands;65%India;15%restoftheworld

Go-to-MarketApproach:

Cognizant’sIoTpracticeoperatesinahub-and-spokemodelconnectingotheremergingtechnologypracticesaspartofitsDigitalWorksTechnologygroup,amulti-disciplinaryteamcomprisedofstrategicconsultants,industryexperts,designthinkers,andtechnologistswhoworktogethertotransformanenterpriseusingastructured,yetagile,methodology.TheIoTpractice wasofficiallyformedin2013.

TargetIndustries:Targetsenterpriseswithmorethan$1billioninrevenue• Core:Manufacturing and Logistics,Banking,

Insurance,Retail,Healthcare,LifeScience

• Additional:Travel,Hospitality

Acquisitions:• ReD(2016)• KBACE(2016)• QuickLedt(2016)• StorebrandBaltic(2015)• Odecee(2014)• Cadient Group(2014)• TriZettoCorp(2014)

Partnerships:• PlatformVendors:Xively,PTC/Axeda,Microsoft

andAzureIoT,ZebraTechnologies,AWS,Cisco,Intel,andGEPredix

• InnovativeSolutions:iControls,Vuzix,GoogleGlass,WIFARER

• AppliedResearch:CarnegieMellonUniversity• Highlyawareand engagedwith thestart-up

ecosphere

• APEx:Assetmanagementas-a-service• Foresight: Connectsdevicesandtransmits,

aggregates,visualizes,andanalyzesdatatoacceleratethedeploymentofIoTprojects.

• HealthActivate:TargetedatLifeSciencescompaniesandhealthcareproviders,forcloud-basedpatientengagement.

• InteractiveExposureMap:geospatialsolutiontargetedtoinsurers

• MedVantage:Cloud-basedsales,service,andcomplaintmanagementsystem

• S3P:SubscriptionEnablementPlatform.• UprotectFailurepredictionservices

IoTServicesOfferingMaturity:

IoTConsulting

IoTEnablement

IoT Connectivity

IoTIntegration

IoTManagement

Strengths Challenges

• StrongExecutionReputationDrivenbyStrongStrategicVision:CognizantishighlyawareoftheimportanceofdigitaltotheservicessectorandtheerosionofIT’sdominanceinitsmarket.Cognizantisseenashavingastrongvisionglobally,andGlobalCEOFranciscoD’Souzahasgood“digitalDNA”toevolvethebusiness.

• FlexibleApproach:Cognizanthasacquiredstrategycompaniesandhas“collaboratory”realestatetodriveinnovationand“theartofthepossible”withclients.RealizingIoTconceptsintocompletedsolutionstoclientbusinessproblemsviaflexiblefinancialandpartneringapproachestotheclientaimshelpprojectsseethelightofday.

• DigitalStructureFostersRapidContextualIoTDevelopment:ContinuingtooperateIoTasahubamidspokesofotheremergingtechnologypractices(SocialandMobile,Security,Cloud,Analytics,Engineering,andManufacturingServices)drawsexpertisefromeachpracticeareawithinprojectcontextandadjacencies.

• AccountManagementReputation:CognizanthasastrongaccountmanagementcultureandisdisciplinedaboutblendingthenewdigitalwitholdITinfrastructure,acommonchallenge,andworkingcloselywithclientsatallprojectstages.ThisagilityisavaluableattributeintheverydynamicandevolvingIoTspace.

• FundingofStart-upConcepts:Cognizantisattunedtothestart-upecosphereandisfundinginternalandexternalprojects.

• DivisionbetweenDigitalandNext-GenIT:BetrayingCognizant’ssystemintegratorITorigins,thecompany’slinguafranca/nativelanguageisstillIT,despiteexcellentdigitalandstrategicIoTcapabilities.

• LackofMessagingClarity:CognizantneedstobeclearerinconveyingIoTanddigitaladjacenciessophisticationandcapabilities.

• LocationofExecutionResources:AlthoughCognizantistakingbigstepstoigniteIoTprojects,oftentiedintobroaderdigitalinitiatives,therealitythatmostresourcesareinIndiamakesaccountmanagementandcommunicationdoublyimportant.Physical“things”cannotbeworkedonviatheInternet;Cognizantneedstobeinthegeographywheretheywilloperate.Asthepracticegrows,thismaybemoreofachallenge.

BlueprintLeadingHighlights

• AccountManagement• StrategicVision• StandardDeliveryMethods• PartnershipEcosystem• CollaborationTechniques• StrengthofVisionfortheIoT

Innovation

Execution

Industrial

Entrepreneurial

Market Direction and Recommendations


What Is Next for IoT ServicesWeseethefollowingasthemajortrendsinthematurationofIoTServicesoverthenext2–3years:

n Themarketwillremainlooselydefinedassomeserviceprovidersrebadgeolderanalytics,mobile,andcloudpracticesas“IoTServices”whileotherscreatestandalonepractices—somenarrowpointsolutions,somebroaderandincludingelementsofIoT/IndustrialInternet.

n Asusecasesmatureandmarketdemandforsensordataflowsincreases,moreandmoreserviceproviderswillpositionthemselvesasIoTcapableandready.

n StandardsandsecuritywillcontinuetobeproblemareasthatimpedeusecasesastheIoTevolvesandbecomesmorecomplex.

n ThematureIndustry4.0andinnovative,emergentIoTuseswillbeincreasinglyintertwinedandreliantoneachother.

n AstheIoTisanattributeofbroaderdigitaldataflowvaluesneedsforbusiness,coherentplatformpartnershipswillbecomeincreasinglycrucialforsuccessforsuppliersandbuyers.

n Creatingdataflows,APIs,andanalyticsaretablestakesforservices,whileidentifyingbusinessvaluefromtheIoTwillbeanincreasinglyimportantdifferentiator.


IDEAL AS-A-SERVICEIDEALDEFINITION

NON-EXISTENT

INITIAL EXPANSIVE EXTENSIVE ALLPERVASIVE

WriteOffLegacyUsingplatform-basedsolutions,DevOps,andAPIecosystemsformoreagile,lessexception-orientedsystemsandprocesses

2016 2020

DesignThinkingUnderstandingthebusinesscontexttoreimagineprocessesalignedwithmeetingclientneeds

2016 2020

Brokers ofCapability


2016 2020

CollaborativeEngagement

Ensuring relationshipsarecontractedtodrivesustainedexpertiseanddefinedoutcomes 2016 2020

IntelligentAutomation

Use ofautomationandcognitivecomputingtoblendanalytics,talent,andtechnology 2016 2020

AccessibleandActionableData

Applyinganalyticsmodels,techniques,andinsightsfrombigdatainrealtime 2016 2020

HolisticSecurityProactivelymanagingdigitaldataacrosstheservicechainofpeople,systems,andprocesses 2016 2020

Plug-and-PlayDigitalBusinessServices

Plugginginto“readytogo”business-outcomefocused, people,process,andtechnologysolutionswithsecuritymeasures

2016 2020

IoT Services Market Adopting As-a-Service IdealsHowIdealsWillProgressBetweenServiceBuyersandServiceProviders


2016–17 Recommendations: Enterprise Buyers

n Beawareofyour opportunitiesand goals: ThematureIndustrialInternetand theemergent IoTaretwodimensionsofthebusinessadvantagesbroaderdigitaldataflowscancreate.Itispossibletounlockthevaluefromtheseonlywithacoherentbroaderstrategy.Manyserviceprovidershavetechnicalexecutionskillsbutarelightonbusinessacumenincreatingandstitchingtogetherthedata“wiring” neededto realize valuefromsmart “things.”

n End-to-end securityisessential: Breachesofnetworksremainamassiveconcernasstandardsandusecasesmature.Theweakestlinkwillbesoughtoutbyattackers,andtheIoTprovidesdangerousphysicalopportunitiesinadditiontodatatheftunlesscarefulthoughtisgiventoallstagesofconnectivityandoperation.

n RealIoTactionishappeningingreatsecrecy:MostpubliclydiscussedIoT initiatives eitherarematurewithlittlecompetitivesensitivityorareprojectsandpilots thatrequirepublicity.Themostinterestingworkis,bynature,strategicallyimportantandunderwraps—pressvendorstoexplaintheirdifferentiationbeyondgenericprojects.

n Pointsolutionsare very different frombroaderdataflowsfrommultipledigitalelements: Addingsensorsandgatheringdataoftencontinueto betheeasiestaspectsoftheIoT.Creatingdatarepositoriesthatcancapturenewinsightsisnowstraightforwardandcanbeleveragedacrossthefirm.TherealchallengefortheIoTischanging broader end-userprocessestodigitalplatformparadigms.

n DeepskillsintheIndustrialInternetarenotthesameasentrepreneurialinnovation:Whiletheheavymachinery–focusedMachinetoMachine(M2M)Internethasbeenevolvingformorethanadecade,emergentdigitalbusinessmodelsforsensor-enabledmass-produceddevicesareaverydifferentworldthatrequiresdigitalstrategyapproachestomaximizebenefitfromdatacreation.


2016–17 Shared Strategic Challenges: IoT Service Providersn Wheretoinvest?LegacyITservicescompanieshavesignificantchallengesinmakingIoTinvestment

commitments,withtheirgrowthinvestmentsatriskfromendlesslow-value“tirekicking”exercisesbyprospectstentativelyexploringandunderstandingbusinessvalue.As-a-Serviceapproachesthisproblemwithflexiblerisk-sharingoptionsthathelpbothsidesoftherelationshipgettogripswithriskandrewardoptions.Education,strategy,anddesignthinkingsessionshelpqualifyandreinventperceptionsofITprovidersasbeingontopofwhatisaverynewfocusareaformostpeople.

n Wheretopartner?Partnerecospheresinthe“systemsofintelligence”erarevolvearounddataflows,withIoTdevicesofallsizesinteractingwiththecoreofbusinesssystems.Manyoftheolderenterprisesystemswereneverintendedforthesevolumesofsophisticatedtransactionsandsecurity.ThismeansIoTserviceprovidershavetochoosetheirpartnerswiselytobealignedwithplatformsthatarefitforpurposeandmakesenseforclientstoinvestinaspartoftheiroperations.

n Wheretofocus?Pure-playdeep“bornIoT”servicesarefrequentlynotwellalignedwithbroaderdigitaltransformationeffortsoflargeclientsarounddatavalue,despiteIoTsensordatabeingincreasingimportantacrossmostverticals.Pointsolutionthinkingandlackofidentificationofdatavalueadjacenciescoulddoomsomehighlyskilledplayerstobeingmerelycommodityprovisionersunlessstrategichorizonsarebroadened.

n Whichstandardstogetbehind?Consistentstandards,security,anddescriptorsareessentialifsharedgoalsacrosstheserviceproviderspectrumaretobemet:Tomanyprospects,IoTisabewilderingblizzardofbuzzwords,conflictingstandards,poorinteroperability,andscarysecurityopportunities.


2016–17 Recommendations: Service Providers, continued

n Abuyers’marketfornow:Forastill-emergingmarket,IoTServicesarebroadanddeepwithpatchyuptakeatwhatsometimeseemsalmostrandomsegmentinterestbyprospects.Consistencyisfoundviaclearpathstobusinessvalue,whichareachievedwithstrategicconsultingandplanning.Whethersupplierschoosetodrivethisactivitythemselvesorpartnerwithconsultingcompanies,thisisalmostinvariablywherescaleprojectsoriginateandwherefocusmustbeconcentrated.

n End-to-end ischallenging: TheIndustrialInternethasmatureincumbentswhilethedigitalentrepreneurspaceisfarmorefluid.Whiletheysharesomesimilartechnologicalunderpinnings,thebusinessdynamicsareverydifferent,andchoosingwhereandinwhatsegmentstospecializeisincreasinglyimportanttobuildoutpractices.Partneringadjacenciesarecriticallyimportanttoprovidebroaderofferingsthatmeetprospectandclientneeds,whileprovidingscalingoptions.

n Platformoropensource/bestofbreed?Both?Manymoderndigitalcompaniesare“fullstack”environmentswithalotofopensourceflexibility.TheIoTspacehasmanycompetingproprietaryplatformapproachesfromlargevendorsthatservicesproviderscanleverage.Findingabalancethatavoidsvendorlock-inisonprospectandclientmindsjustasitiswithsuppliers.As-a-Servicelendsitselftoplatformapproaches, butopensourceisanessentialelementofsystemsintegrationanddigitaldataflowenablement.

n Securitysecurity security:Fearofsecuritybreachesisasignificantbarriertomanycommercialdigitalinitiatives,andconcernsabout“theweakestlink” areallthemoreseriouswhen“things”canbecompromised.ClientsbeingabletosleepatnightknowingtheirnewIoTenvironmentsaresecurearetablestakesforparticipation.

About the Author


Oliver MarksVPDigital&IoT,HfSResearch– SanFrancisco, CA

Overview• LeadsDigitalandInternetofThingsresearchforHfSResearch

• Extensivepriorexperienceconsultingandadvisingwithcompaniesoneffectiveinternationaldigitaltransformationstrategyandexecution

• Streamlining,simplifying, andmodernizingwaysofworking,findingthecorrect“recipe”ofnewtoolstocombinewithlegacysystemsandprocesses,andidentifyingviablebusinessmodels

PreviousExperience

• Built,ran,managed,andevolvedglobalgamedevelopercollaborationenvironmentatSonyPlayStationWorldwideStudios

• LedtheGlobalDigitalEnterpriseTransformationconsultingteamatHP

• Numerousreal-worldstrategicprojectsundertightNDAinmultipleindustryverticals,includingCPG,BFSI,Energy,andMergers&Acquisitiondigitalbusinessstrategies

• OliverisbasedintheSanFranciscoBayareaandgrewupintheUK.

[email protected]


About HfS ResearchHfSResearch isTheServicesResearchCompany™—theleadinganalystauthorityandglobalcommunityforbusinessoperationsandITservices.Thefirmhelpsenterprisesvalidatetheirglobaloperatingmodelswithworld-classresearchandpeernetworking.

HfSResearchcoinedthetermTheAs-a-ServiceEconomy toillustratethechallengesandopportunitiesfacingenterprisesthatneedtore-architecttheiroperationstothriveinanageofdigitaldisruption,whilegrapplingwithanincreasinglycomplexglobalbusinessenvironment.HfScreatedtheEightIdealsofBeingAs-a-Service asaguidingframeworktohelpservicebuyersandprovidersaddressthesechallengesandseizetheinitiative.

Withspecificfocusonthedigitizationofbusinessprocesses,intelligentautomation,andoutsourcing,HfShasdeepindustryexpertiseinhealthcare,lifesciences,retail,manufacturing,energy, utilities,telecommunications, andfinancialservices. HfSusesitsgroundbreakingBlueprintMethodology™toevaluatetheabilityofserviceandtechnologyproviderstoinnovateandexecutetheEightIdeals.

HfSfacilitatesathrivinganddynamicglobalcommunityofmorethan100,000activesubscribers,whichaddsrichnesstoitsresearch.Inaddition,HfSholdsseveralServiceLeadersSummits everyyear,bringingtogetherseniorservicebuyers,providers,andtechnologysuppliersinanintimateforumtodevelopcollectiverecommendations—fortheindustryandtoadddepthtothefirm’sresearchpublicationsandanalystofferings.

Nowinits tenthyearofpublication,HfSResearch’sacclaimedblogHorsesforSources isthemostwidelyreadandtrusteddestinationforunfetteredcollectiveinsight,research,andopendebateaboutsourcingindustryissuesanddevelopments.HorsesforSourcesandtheHfSnetworkofsitesreceivemorethanamillionwebvisitsayear.

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