IOT is a complex world of Systems of Systems type solutions that require consortium type partnerships in order to identify, define, create and deliver meaningful solutions. It will be an economy driven by vast ecosystems of suppliers working in tandem to produce a highly complex product or service that is easy and intuitive to use and is cyclically upgraded with new features. Today’s concepts of competition and partnerships within industries are being redefined through the advent of increasing capabilities of smart, connected products expanding industry boundaries. Contextual forces of the nature of consortium type partnerships that will challenge the existing model of the 5 forces that shape industry competition.

For a company to be an impactful player and profitable venture in this new reality, they must understand that the traditional model of competition shifts from discrete product systems made up of closely related products, to systems of systems that mesh a cadre of product systems together. I can envision a new type of Search Engine Logic for IOT-as-a-Service, a form of IOT match making (dating) logic App that would both auto-detect the right opportunities for companies to participate in and also advertise their willingness to be considered for certain types of roles. It would look something like the following: 

The companies finding themselves on the upper left of the chart would receive the most opportunities to consider and chase down, which would be a time intensive and costly existence…more fitting for a venture start-up trying to establish itself, or possibly an old-line company that finds itself with lagging sales, commodity service offerings, a dated product portfolio, and has determined it must “transform or face a dire future.” Companies on the lower right of the chart have made the investments in a portfolio of highly desired capabilities and have MSAs already in place with partners that enable speed to market joint ventures.
So how would a company identify where it currently resides on this chart and determine what level of investment it would need to make and in what areas of their business to increase its level of value conversion rates? What I propose is a concept for a new type of “IOT Compatibility Formula” that companies could use to determine ability to play in the “IOT Championship League.” The formula would look something like this:

I think we could derive from this formula a method to start hypothesizing the impact of concepts such as having MSA’s already in place may be the biggest factor in determining the number of value opportunities that can be converted into wins. Another important factor maybe a company’s portfolio of ready-made, industry specific solutions that are designed to be open-source, have the ability to communicate with other components of the system;  and easily be upgraded to remain  compatible with other partner’s solutions and yet have appropriate cyber-security mechanisms in place. Some companies will need to make important decisions around investing in innovation and defining how broad of a portfolio of services and products should they carry. It is also a given that everyone, no matter where they fall on the chart, will be attracted to the high value promise of data analytics living within these systems and will undoubtedly see themselves as wanting ownership of information and thus making whatever investments that they can afford in this aspect. It is also likely most of these variables will have a Cloud component due to its ubiquity and current low cost. Wouldn’t it be interesting to see a Google or an Amazon offer such IOT optimization service?