Industrial manufacturers are introducing Internet of Things (IoT) technology into their operations to drive Industry 4.0 business value – from predictive maintenance to remote condition monitoring and new product innovation.

However, the high-rate of stalled and failed IoT initiatives – which, according to a recent Cisco study, account for an immense 75% – continues to reflect how industrial IoT development remains complicated, expensive, and risky.

To make IoT development faster and easier, companies turn to industrial IoT development platforms. Here we explore how to measure the ROI delivered by these platforms.

ROI IoT

Building the ROI model

IoT development platforms provide companies capabilities ranging from the design and delivery of connected products, to collecting and analyzing system data once in-market. Throughout these development phases, we can measure the ROI of IoT platforms with a model based on four key benefits:

Reduced time-to-market

Rapid time-to-deployment is a determining factor for maintaining a competitive advantage and controlling costs, making it a key benefit of an IoT development platform.

A strong IoT platform will reduce project delivery time by 10-20% with some or all of the following tools:

  • Visual modeling to accelerate the design of the system architecture and use cases
  • Auto-generated specification documents and simulations to validate the system
  • Central execution hub for product teams to collaborate and realize the system
  • IoT marketplace to reduce development time across team members – internal and external   

Reduced development costs

Companies that have advanced with industrial IoT initiatives beyond concept definition are faced with challenges of ensuring feasibility, market-fit, and early buy-in. The result is often an investment in resources for prototyping products that are not technically or financially viable, or which lack stakeholder and customer backing for laying the groundwork of a successful launch.

Leading IoT development platforms will therefore provide tools for fool-proofing specifications to detect mistakes made in hardware design, firmware or software logic, system architecture, and data integration.

A strong IoT platform will reduce development costs by %25-%35 with tools like IoT simulation, to virtually prototype the connected system to identify mistakes and stay on budget.

Simulation inside an industrial IoT development platform

Simulation inside an industrial IoT development platform

Reduced supplier costs

IoT development requires new skill sets, from data analytics algorithms to cloud development and security. For the majority of companies, sourcing and working with external partners is a time-consuming and expensive process. Teams are also faced with the challenge of vetting providers and weighing the pros and cons of each.

To cut sourcing time and reduce risks involved in working with new suppliers, a valuable IoT platform will have an integrated partner marketplace with pre-screened suppliers. Companies should also be able to compare between vendors and quotes, improving the chances of working with the right supplier according to specific business needs and budget constraints.

Accelerated innovation

As the number of connected machines, production lines, and sites continues to rapidly grow, manufacturers are seeking out innovative solutions to adapt their businesses.

The speed at which companies develop new product concepts, connect existing products, and embrace opportunities afforded by data analytics and connectivity, is becoming increasingly important to their bottom line.

For this reason, a strong industrial IoT development platform must provide manufacturers with an accelerated innovation process to generate more IoT use cases, product concepts, and solutions that deliver tangible business benefits.

Calculating total ROI

A best-in-class industrial IoT development platform paves the way for companies to  take advantage of new business opportunities, from predictive maintenance to condition monitoring, and data services.

Manufacturers weighing IoT platforms should look for ROI in accelerating innovation, cutting time to market, reducing development and supplier costs.

To calculate the overall ROI model, we’ve compiled a comprehensive model based on a company use cases, which quantifies the business benefits alongside the cost associated with an IoT development platform. 

For the detailed ROI model for industrial IoT development platforms, download a copy of our whitepaper: 

Get the free whitepaper – ROI Model for Industrial IoT Platforms

IoT ROI Guide

This whitepaper provides an in-depth ROI analysis for companies weighing IoT development platforms.

 

Jackie Retig

Jackie is a technology expert, focusing on the Internet of Things and the ways in which our world is becoming more connected.