How Skill Gaps Limit IoT Implementation Success

Don Gordon

The Internet of Things (IoT) has spurred the attention of many within the consumer products (CP) industry. And with good reason – McKinsey anticipates an increase of about three billion new consumer devices per year. IoT provides connections and accessibility between companies and customers, while behind the scenes, consumer product companies stand to reap enormous benefits from integrating IoT into their manufacturing, supply chain, and sales and marketing processes.

Companies are paying attention

SAP’s just-released Global Study of IoT Adoption in the CP Industry confirms that CP companies increasingly recognize the value that IoT provides. Further, the study provides insight into the specific steps that forward-looking CP companies are undertaking as they seek to move forward on their IoT agendas.

Learn from successes or failures of early movers

One of the challenges of an emerging set of technologies like IoT is that there are no established set of models or best practices to follow. Consider that 51% of consumer product companies that are early movers in IoT are focused on learning from the successes or failures of early movers. Organizations that are moving quickly to move forward with an IoT agenda seek to learn what they can from early movers, even while recognizing that the data is limited. Given the early stage of IoT adoption in the CP industry, many companies are likely to embark on experimental efforts, learning from their and others’ success and failure as they go.

Creating processes to manage IoT

Organizations see the importance of implementing processes to manage the IoT adaption. Of the consumer products companies most bullish on IoT, 59% are focused on processes to manage it. This is essential. The nature of IoT will require different processes to manage than what is currently occurring. It will draw data from across processes and, as a result, require the ability to analyze information outside of traditional silos.  As a real-time process, there’s the growing need to build flexibility into the current processes to ensure real-time adjustments can be made based on the information coming in. Without this change, organizations would have a large amount of data coming in, often very rich, usable data, but no way to understand it or use it.

Recognizing the skills and capabilities gap in consumer products IoT is critical

Hiring or retraining existing employees is an invaluable component to IoT adaption in the consumer products industry. Companies will need to redefine the roles of employees and provide them with training to the management of IoT. This will play out in a number of ways.

Key soft skills will define success

It’s estimated that 68% of businesses that aim to implement IoT, or that are already doing so, are struggling to find employees with the skills to address IoT-focused business models, according to a report from Canonical. With machines talking to machines, it will be important for employees to move away from labor-focused work. What skills should they have?

The skills and talents that this workforce will need are vastly different than the current supply chain and manufacturing workforce. Key among these skills:

They must be analytical thinkers

Analytics is at the heart of IoT. That is, workers need to have skills in artificial intelligence, machine learning, and analytical thinking. These skills will help individuals to draw insight from the information streaming in through IoT sources. Then, individuals will have the ability to make key decisions based on that large amount of data. Data will stream in from multiple processes, all of which will need to be effectively analyzed based on the company’s needs and goals. From this information, they will make decisions that impact the customer and the company.

A willingness and ability to collaborate

Moving away from the manager-employer typical focus, those working in IoT will be collaborators. IoT by its nature will take people out of their silos. People will need to work together across multiple departments to make decisions and to progress the company’s goals. There’s significant opportunity in planning across key functions. This includes R&D, manufacturing, fulfillment, sales and marketing, and so on. The problem is, many employees currently lack the ability to work like this; they are accustomed to working in very specific positions handling single tasks on their own.

They need to be big-picture people

Finally, key employees in IoT must be able to see the bigger picture. No longer are they thinking about today, a single task, or a single piece of information. They must be able to look cross-functionally across the value chain. More fully, they must also be able to look across to ecosystem partners with whom data will be shared. By being able to see this “big picture,” those employees not only can achieve current goals, but also find new opportunities for expansion, sharing, and scaling. This is empowering for today’s IoT organization but remains one of the hardest to find skills by the average employee currently working in these industries.

There’s little doubt that IoT is valuable. More companies recognize this each day. However, without a properly skilled team behind the scenes, it will be difficult for companies to achieve the goals they set out to achieve. That could limit their reach. Effective third-party relationships can be a strong component to creating that cohesive environment.

Learn how to innovate at scale by incorporating individual innovations back to the core business to drive tangible business value: Accelerating Digital Transformation in Consumer Products. Explore how to bring Industry 4.0 insights into your business today: Industry 4.0: What’s Next?

About Don Gordon

Don Gordon leads global Consumer Products industry marketing for SAP. Previously he led global Retail industry marketing for IBM. He lives in Philadelphia, considered by many to be the finest city on earth.