Smart Buildings

New Normal, Same Problems – The Continued Need for Better IoT Governance

“Historically, IT and OT roles were driven by clearly distinct business requirements. The IT role focused on information flows, while facilities managers were more focused on the physical functioning of a building. The two departments would typically operate in functional silo’s with little strategic alignment or influence over each other’s projects and initiatives,” stresses our latest report. “The convergence of the physical and digital worlds being brought about by the Building Internet of Things (BIoT) projects will necessitate changes to strategic thinking, working practices, and cross-fertilization of previously role-specific skills in this regard,” continues our report entitled: The Internet of Things in Smart Commercial Buildings 2020 to 2025 — Market Prospects In The Age Of Covid-19. Strategic thinking starts at the top but as IoT rapidly changes how many companies operate, deciding which organizational function is tasked with the commissioning and delivery and management of IoT initiatives varies significantly. The organizational structures and cultures put […]

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“Historically, IT and OT roles were driven by clearly distinct business requirements. The IT role focused on information flows, while facilities managers were more focused on the physical functioning of a building. The two departments would typically operate in functional silo’s with little strategic alignment or influence over each other’s projects and initiatives,” stresses our latest report.

“The convergence of the physical and digital worlds being brought about by the Building Internet of Things (BIoT) projects will necessitate changes to strategic thinking, working practices, and cross-fertilization of previously role-specific skills in this regard,” continues our report entitled: The Internet of Things in Smart Commercial Buildings 2020 to 2025 — Market Prospects In The Age Of Covid-19.

Strategic thinking starts at the top but as IoT rapidly changes how many companies operate, deciding which organizational function is tasked with the commissioning and delivery and management of IoT initiatives varies significantly. The organizational structures and cultures put in place by executives all play their part in prioritizing different parts of the business. This also has a direct influence on the way company’s develop their networks and facilities, but that all starts with who is in charge of the IoT budget.

“In the case of the BIoT, facilities manager involvement is clearly key, but for projects in some vertical markets, such as the retail or hospitality sectors, more often than not, FM managers are neither the main sponsor nor the main champion of new investment initiatives,” suggests the report. “Instead, for these sectors, surveys consistently cite marketing executives as taking the lead, even for building-related projects. Here, investment decisions revolve more around sector-specific priorities such as customer engagement and retention, over more typical facilities priorities of operational cost savings or energy savings.”

These practices often lead to greater siloing and friction between departments as each drives their own agenda for what a building should be, but that’s the opposite of what the BIoT is trying to achieve. The diversity of BIoT applications and system configurations already presents enough complexity, adding another layer with organizational siloes and in-fighting is counter-productive. Moreover, the true value of the BIoT can only be delivered with the active engagement of all key stakeholders, and the widespread acceptance of the technology across all departments.

“Forming inclusive and diverse delivery teams can help to drive increased value from BIoT investments. To fully capitalize on potential business value, business siloes need to be broken down with cross-functional teams contributing to systems design, delivery, and value generation,” recommends the report. “A failure to address these kinds of stakeholder concerns as part of the project planning process can lead to a breakdown in communication, leading in turn to unenthusiastic parties attempting to block, delay or modify project outcomes.”

OT departments need to select systems that will solve the problem, work with legacy processes, and have the necessary dimensions, among other things. However, the IT department will also need to ensure IT network utilization, systems interoperability, and security implications of any proposed solution early in the selection process. Human resources, business development, marketing, and many other parts of the business may also hold valid inputs for occupant-focused BIoT systems, and their involvement alone is enough to increase the chance of the system’s success.

These challenges, alongside cybersecurity, data privacy, skill shortages, procurement, commissioning, and data challenges, plus a host of other market barriers discussed in the report, were already concerns before the global events of 2020 unfolded. The COVID-19 pandemic and its fallout has made almost everything more difficult, at least temporarily, making narrow and unrepresentative IoT strategy even riskier. With the world in crisis and recession looming, now is the time to get things right the first time and drive the greatest return on investments.

“A series of inter-related challenges (driven by the COVID-19 crisis) will make 2020 a tough year for the market for BIoT in smart commercial buildings, and we predict a drop in revenues compared to 2019, states the new report. “However over our forecast period (to 2025), we predict global growth of 11.6% in the best case, with overall market revenues rising from $42.8Bn in 2019 to $82.7Bn in 2025, versus 7.3% in the worst case, with more modest total revenues of $65.2Bn by 2025.”

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