Over 80% of cos upped revenue via IoT investment: TCS study

MUMBAI: If you haven't invested in Internet of Things (IoT), it is high time you should as a Tata Consultancy Services (TCS) study says that over 80% of companies have increased their revenues through IoT investments.

Across the board, those companies investing in IoT have reported significant revenue increases as a result of IoT initiatives with an average increase of 15.6 percent in 2014. Almost one in 10 (9 percent) saw a rise of at least 30 percent in revenue, the study said.

Company executives still see the IoT as a growing area for businesses, with 12 percent identifying a planned spend of $100m in 2015 and three percent looking to invest a minimum of $1bn among the 795 companies surveyed. The report also shows that companies predict their IoT budgets to continue increasing year-on-year, with spending expected to grow by 20 percent by 2018 to $103m.

TCS, a leading global IT services, consulting and business solutions organization, has launched a major new global study looking at the impact of IoT technologies across a wide range of industry sectors around the world.

The TCS Global Trend study on IoT, which surveyed 795 executives from large multi-nationals, identifies the huge potential for revenue increases from IoT, while also highlighting the significant challenges that lie ahead for businesses transitioning to the new model.

Companies at the very forefront of this drive for innovation through IoT have seen the biggest benefits from their investments. The top eight percent of respondents, based on ROI from IoT, report a 64 percent average revenue gain in 2014 as a direct result of these investments. Currently the biggest business impact is that companies can offer their customers more bespoke products and services, yet by 2020 this will convert from marketing functions to increased sales, through adding considerable value to the customer.

This is reflected in the finding that the most frequent use of IoT technologies by companies is tracking customers through mobile apps, used by almost half of all businesses (47 percent). More than half (50.8 percent) of IoT leaders admit to investing in IoT to track their products and how these were performing, whereas this is only the case with 16.1 percent of the respondents with the lowest ROI from IoT.

Natarajan Chandrasekaran, CEO and MD of TCS, said: “The age of IoT is well underway. The question is, whether businesses are ready to realize the full potential of this technology. Our latest global trend study found that leaders in using IoT technologies are using it to completely re-imagine their businesses by changing every aspect of them from business models and products to business processes and workplaces.”

He added: “Now is the time for every leader in every industry to reimagine the possibilities for their businesses in a world of smart, connected ’things’.”

The report found that the three biggest factors holding companies back were:

I. Corporate culture: Respondents identified the ability to get employees to change the way they think about customers, products and processes was a major barrier;

II. Leadership: Having top executives who believe in IoT and are willing to invest time and resources is critical;

III. Technology: Questions around technology continue to loom large including handling Big Data; internal vs. external development; integrating IoT data with enterprise systems; and ensuring security and reliability.