In the last several years, there has been a lot of excitement and wealth generated by the startup companies that are disrupting traditional industries. The obvious example is Uber and it's impact on the taxi and livery industry. And there are many more - Tesla, Nest, Salesforce.com and the list goes on.
In each of these cases, the startups digitally transformed an existing industry. At first glance, people focus on the application transformation - a new cloud/mobile app and a new business model that create a monumental shift in value for consumers and, in return, creates incredible value for the entrepreneurs and financiers.
In reality, most of these cases are about the combination of "the internet of things" (IoT) and a new application, paired together to create the outcome. In the case of Tesla and Nest, that's easy to see. They created a new, smarter thing and gave you an app. The transformation was instantaneous.
What's harder to see is that the IoT connection is far deeper than that. I would call Uber an IoT play. Now, in that case, they didn't create a new device, they made an existing device network-connected - the black car, the taxicab, etc... They did it by putting a mobile phone inside the device with a new app, operated by a human. When self-driving cars arrive, you can bet the humans will be out of the picture (more here) and the IoT connection will be clearer.
So, that's the last several years. Next up is a massive wave of traditional companies combining IoT and new applications to create a quantum leap in value for their customers and for their companies and shareholders. This will happen when the companies that already have an incredible network and penetration of "things" start harnessing those things and building new apps to work with them.
Consider how Coca-Cola is turning their vending machines into connected things (more here). It allows users to create custom flavors and for Coca-Cola to learn from that. Imagine what else they can do to create customer value - recognize you when you approach the machine, save your flavors, publish them to your network of friends, try your friend's flavors, vote on the best new flavors. To win, a startup has to invent a better soda franchise, then build some cool technology. That might be tough.
GE is doing this with it's engines - changing the business model, delivering more value to their customers, lowering GE's cost and growing revenue (more here). GE has many more industries with intelligent industrial equipment and this is a market that startups will likely not disrupt any time soon.
There are a lot of very exciting startups in Silicon Valley and around the world. They will continue to do great things and create lots of exciting new applications that transform out lives. But, what I am really excited about these days is the transformation that is coming to the existing market leaders and their competitors who are going to leverage IoT, the cloud and mobile apps to disrupt their own industries.
In each of these cases, the startups digitally transformed an existing industry. At first glance, people focus on the application transformation - a new cloud/mobile app and a new business model that create a monumental shift in value for consumers and, in return, creates incredible value for the entrepreneurs and financiers.
In reality, most of these cases are about the combination of "the internet of things" (IoT) and a new application, paired together to create the outcome. In the case of Tesla and Nest, that's easy to see. They created a new, smarter thing and gave you an app. The transformation was instantaneous.
What's harder to see is that the IoT connection is far deeper than that. I would call Uber an IoT play. Now, in that case, they didn't create a new device, they made an existing device network-connected - the black car, the taxicab, etc... They did it by putting a mobile phone inside the device with a new app, operated by a human. When self-driving cars arrive, you can bet the humans will be out of the picture (more here) and the IoT connection will be clearer.
So, that's the last several years. Next up is a massive wave of traditional companies combining IoT and new applications to create a quantum leap in value for their customers and for their companies and shareholders. This will happen when the companies that already have an incredible network and penetration of "things" start harnessing those things and building new apps to work with them.
Consider how Coca-Cola is turning their vending machines into connected things (more here). It allows users to create custom flavors and for Coca-Cola to learn from that. Imagine what else they can do to create customer value - recognize you when you approach the machine, save your flavors, publish them to your network of friends, try your friend's flavors, vote on the best new flavors. To win, a startup has to invent a better soda franchise, then build some cool technology. That might be tough.
GE is doing this with it's engines - changing the business model, delivering more value to their customers, lowering GE's cost and growing revenue (more here). GE has many more industries with intelligent industrial equipment and this is a market that startups will likely not disrupt any time soon.
There are a lot of very exciting startups in Silicon Valley and around the world. They will continue to do great things and create lots of exciting new applications that transform out lives. But, what I am really excited about these days is the transformation that is coming to the existing market leaders and their competitors who are going to leverage IoT, the cloud and mobile apps to disrupt their own industries.
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