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Smart Products mean Machines and Workflows Merge

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Smart Products mean Machines and Workflows Merge

Welcome back. I had a good summer between the DIY, gardening, decorating and our annual summer holiday. I did my best to switch...

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Welcome back. I had a good summer between the DIY, gardening, decorating and our annual summer holiday. I did my best to switch off—and make both my kids switch off—their emails, texts, status updates, clicks, swipes etc. And on holiday it was as if we’d landed up in Syria and not Norfolk judging by look of horror on their faces as we entered into our seaside accommodation….“WHAT? NO WIFI! You are KIDDING?”  But no Wi-Fi gave us all time to slow down, relax, and actually think about stuff and after this time away there is no doubt in my mind that modern technologies are indeed rewiring brains.

Back at work, fighting fit and figuring out where the Center needs to focus for the rest of this year and into next and I am going to make two big bets. The first is to keep on focusing on smart products. Smart products are bang on the money (and will be for some time) and I am starting to grasp where the wider trend of IoT is going—smarter products AND smarter processes. Thankfully, we have research, ideas and frameworks covering both with my take on smart products here and my colleague Rob Brown’s  view on smarter processes here. I do think we are onto something looking at the world of IoT from these two perspectives. The reason is that the hockey stick numbers game going on behind the IoT misses the point. We can talk about the IoT market in terms of millions of devices, zillions of sensors, trillions of Pounds, Dollars, Euros but what does it mean to a company, an organization, or an R&D/strategy lead picking products, experiences or processes and adding sensors and collecting data? I suspect they’re starting to recognize the longer term impact on the design cycle, personalization strategies, manufacturing techniques, channel dynamics, the underpinning business model and much more importantly, the risk from not doing anything. I make this point many times:

“Success with smart products means integrating the explosion of product data into the monolithic 20th century industrial model. Moving too slowly would be catastrophic. The ability to listen closely to the customer — or partner with someone that can — will fuel seemingly endless and unforeseen value creation as the blending of a product’s physical characteristics with its virtual capabilities becomes the rule rather than the exception. This IS digital disruption writ large.”
—p19, The Rise of the Smart Product Economy

My next few posts will chart the next 10 years for smart products—the three phases that will dictate how it may well play out. Other industry players are coming to the same conclusion with manufacturing offering a powerful example. For example, Markus Loffler from McKinsey points out that traditionally, we have separated physical flows from information flows and then found various ways to coordinate and synchronize them (thank you SAP). Because of the IoT, the difference between information and materials is beginning to blur, as products are being inextricably linked to “their” information, or their own unique identity. For example, a piece of metal or raw material may “know” for which customer it is intended and how it will be processed. Once the material is in the machine, the material itself records any deviations from the standard process, determines when the processing is over and knows how to reach its customer. Ultimately, manufacturers will be able to think through the interdependencies among the machines, the production components, the manufacturing environment, and the technology that connects it all. “Process and device” will be inseparable; physical things will become part of the process. So machines and work flows will merge to become a single entity. The work flow will cease to exist as an independent layer and will become integrated into the hardware. Think of what it means for production processes, for market innovation, for efficiencies, for supporting processes. This IS digital disruption writ large.

My other big bet for the center in 2016 is the workforce of the future. What does the “future of talent” look like in the digital age? What does it look like in Europe? We know businesses are increasingly digital in orientation both in products and in services. These changes are leading to shifts in the supply and demand of skills and talent. What will your kids do in 2025 as they hop into their driverless cars and do “work.” What will they do? What skills do they need? Hopefully I will have some answers to share…

PS. Wi-Fi may well be rewiring our brains but it’s saving the great British pub. On holiday we found the “free” Wi-Fi conveniently situated in the local pub’s beer garden…it would be rude not to have a pint.

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