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IoT & the Innovation Gap

Some of today's largest and most powerful technology companies have a problem. They've fallen into what I call the “innovation gap.”

What is the innovation gap?
Scientists working in research and development at large firms are at the forefront of some of the best ideas for wearable technology, smart technology, and the Internet of Things. Before those ideas can be brought to life, however, they're running up against corporate finance teams asking what the return on investment will be. The scientist often doesn't know and the idea thus stays on the drawing board. As time goes on, this innovation gap is widening.

Take, for example, smart technology. One of our engineers' biggest takeaways from element14's smart technology design challenge was that a lot of appliances haven't changed much since they were first invented. A time traveler from the 1950s would still be able to navigate through a kitchen today with relative ease and operate an oven, coffee maker, and microwave. Why is that? In the business world, we have become so risk-averse that companies have started opting for small, incremental improvements to their products, and larger firms have turned to acquiring smaller companies in the hopes that those buyouts will “guarantee” innovation. The truth is these strategies are not enough to close the innovation gap. So what is the best solution? How can today's technology companies maintain a competitive edge without fear of debilitating loss or risk?

Overcoming the innovation gap
To overcome the innovation gap, companies need to engage the DIY community. Partner with makers, hacker spaces, and other smaller firms to find the next generation in appliances or wearable devices, and guarantee royalties at the end of the process. For example, element14’s Smarter Life Challenge sponsored 15 competitors to build forward-thinking technologies over a four-month period, with the winning smart designs receiving vouchers to our retail sites and a trip to Embedded World in Germany. One of the winners is looking to turn his design into a product.

Design challenges and communities facilitate innovation by working with suppliers, manufacturers, and larger firms to translate their ideas and objectives into real solutions and products. The technology to develop and test such solutions has become cheaper than ever. A single engineer or maker can prototype industrial applications with just a Raspberry Pi or Arduino board. This means the gap between what larger companies are using to prototype devices, and the technology available to DIYers to prototype devices, is narrowing.

We are already seeing other industries tap into the maker movement. For example, Levi’s launched the Levi's Makers tag at their boutique shops in the US to promote individual designers and their products. General Electric, Home Depot, and Best Buy have all followed suit with their own makers' product lines. Quirky and Skillshare foster online communities that influence product designs and launches.

Democratizing the industrial revolution
All of these elements combined — technology, design initiatives, new corporate strategy — are coming into place and democratizing the modern Industrial Revolution. Individuals are participating in the prototyping and production of solutions for large companies across industries. Departments like IT and R&D have traditionally been very closed, secretive and internal but are now opening up. Larger manufacturers have even come into frame for product design and development, providing essential marketing, sales, and distribution services to bring maker-based innovations to the main stage.

The innovation gap and the importance of the DIY community is not a secret, but rather a trend. It is going to hit every major industry at full force whether we are ready or not. Larger companies be warned: Many organizations believe that to survive they must “innovate or die.” They worry solely about innovation and lose sight of the best approach to achieving it. Connecting with the developer community is a low-cost and unique way to achieve innovation — but finding a way to access those makers is your responsibility.

9 comments on “IoT & the Innovation Gap

  1. Daniel
    June 12, 2014

    “Scientists working in research and development at large firms are at the forefront of some of the best ideas for wearable technology, smart technology, and the Internet of Things. Before those ideas can be brought to life, however, they're running up against corporate finance teams asking what the return on investment will be.”

    Christian, for any business ROI is important for their sustainability. But when they are venturing in to new domain or with new products they have to bear some sort of risks. If a product is first time marketing, they can do some market surveys or demand survey to know the life or existence of such products. I think marketing companies will do all sort of such things before they venturing into marketing.

  2. Wale Bakare
    June 13, 2014

    >>I think marketing companies will do all sort of such things before they venturing into marketing< <

    I agree with you. What about time to market?

  3. Daniel
    June 16, 2014

    “I agree with you. What about time to market?”

    Wale, time depends up on various factors like size of the product, cost, competitors and targeting segments. If it's an essential product for day to day life, then marketing time will be less (example- Grocery, kitchen utensils etc). Those who are targeting companies or non essential items have a more waiting period.

  4. Wale Bakare
    June 16, 2014

    Surely internet remains pivotal to technology development as we are expecting lots of innovations in years ahead. But, issue like intellectual property rights (IPR) could be another aspect to look at.

  5. Hailey Lynne McKeefry
    June 16, 2014

    @Rich, the DIY community is a powerful source of innovation and these folks are often doing this out of interest. I totally think that it's a great thing to reward them with a way to underwrite their hobby. Newark has a great track record of supporting designers with these contests… mainly because the vouchers are a small part of it. It's also a way for these folks to get attention and support.

  6. Hailey Lynne McKeefry
    June 16, 2014

    I think that smart organizations are willing to take calculated risks. The best examples in the industry of innovation are those companies that are willing to step outside of what's always been done into a new realm. Before the iPad, for example, no one really thought they needed one. THe ROI potential at the outset was abysmal.

  7. docdivakar
    June 17, 2014

    Regarding the statement “A time traveler from the 1950s would still be able to navigate through a kitchen today with relative ease and operate an oven, coffee maker, and microwave,” it is not the risk-averse nature of businesses, it is rather that many of these appliances / products have reached the crest of their design & optimization and there is very little fundamentally than can be innovative. So a kitchen microwave with its own WiFi connection doesn't appeal to many product designers and engineers as the next hot thing to work on!

    I do believe there are fundamental, game-changing innovations underway for I-o-T devices -in lower power SoC's, energy scavenging and power management.

    MP Divakar

  8. Hailey Lynne McKeefry
    June 17, 2014

    @Docdivakar, I'm not sure that we've really hit the crest of innovation for our favorite appliances. To me, innovation is all about breaking through the assumption that we are done. Last month, I saw a new toaster that is made of glass and semiconductors embedded within the glass heat and toast the bread…or even roast the steak. It's app enabled and has IoT written all over it.  Read more: http://www.digitaltrends.com/home/beyond-bread-amazing-glass-toaster-can-cook-steak/#!0fe2X

    bugatti noun toaster

  9. Daniel
    June 18, 2014

    “Surely internet remains pivotal to technology development as we are expecting lots of innovations in years ahead. But, issue like intellectual property rights (IPR) could be another aspect to look at.”

    Wale, protecting the IPR is a big concern.

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