How to Successfully Build a Business Case for Your IoT Project
by Exosite, on March 22, 2018
In a previous blog entitled, The Stages of the IoT Project Lifecycle, we walked through all of the stages each IoT project faces. We also did a deep dive on the first stage in How to Gain Traction and Avoid Common Mistakes in the Early Stage of Your IoT Program. In this blog, we'll highlight the second stage, known as the Validation stage, to provide tips on how to create a solid business case and avoid the common obstacles that prevent project momentum.
Organizations that are in the Validation stage should be looking to build a case for advancing the product idea before making the commitments to build a full-blown proof of concept. The business case is typically validated through a variety of research activities, whereas the technical feasibility of the product concept is proven out as quickly as possible through micro-experiments and the use of low-fidelity demonstrations of connectivity.
Questions to Create Traction
Organizations that are new to adopt IoT may feel tempted to quickly develop an IoT project to stay competitive and just figure out the rest later. From our experience, organizations that take the time to create a business case and answer tough questions early on have better success with their overall IoT project and avoid potential obstacles down the road. Below are questions to help organizations build a solid business case and create momentum during this stage.
- Why would customers pay money for the product?
- Why would users adopt the product?
- What needs to be built and where are the biggest technical unknowns?
- How can data be used to create a competitive advantage?
Common Pitfalls and Solutions
Assuming that a waterfall project plan leads to success in IoT. One of the great pitfalls that organizations succumb to is assuming that their current waterfall-driven, new-product introduction process should be rigidly adhered to for unproven technologies like IoT. Project teams feel like they never have the momentum or support necessary to get off the ground.
- Solution: Avoid over-engineering. Getting aligned up front is critical, but it’s also important to resist an organizational culture that demands teams answer every question, interrogate every feature, and provide detailed roadmaps prior to the product concept being validated. It’s possible to take a balanced approach to vetting product ideas that leverages existing technologies and gives stakeholders the confidence they need to move forward.
Including too many people too soon. The temptation for many mature organizations is to pay the “people tax” up front by bringing too many people into the conversation, which eats into budgets, encourages design-by-committee, and slows the time it takes go to market. Hundreds of hours can be spent sorting out who should be involved, what needs to be accomplished, and how best to move forward with a detailed plan that doesn’t break the budget—that type of time commitment is overkill for any validation stage.
- Solution: Avoid bringing too many people into the up-front conversations when it’s still largely an unproven idea (i.e., “counting chickens before they’ve hatched”). This can be done by keeping the core team small and limiting participation to those needed to answer the key IoT readiness questions around business case validation and technical feasibility.
Completing the Validation Stage
Validation is complete when all of the details have been gathered to socialize the business concept, articulate the ROI projections and the business model, and ensure confidence in the project's success. In regards to the level of readiness, the goal is to eliminate as many of the show-stopping unknowns as possible.
It is crucial to have a solid business case and understand the common obstacles if you want to gain traction. Wrestling with the questions early on and creating a clear business case will give you solid ground to stand on when you begin developing your project. To learn more, download your own copy of our free Understanding the IoT Project Lifecycle white paper. If you’d like to learn what the next step is in your IoT journey, download our IoT Readiness guide or connect with one of our IoT experts.