Lack of IT leadership fuels IoT trial failures

Many companies experience failure at the proof-of-concept stage of internet-of-things (IoT) projects, a study of 3,000 decision-makers has found. Among the 218 organisations in a Microsoft survey that said they were actively adopting IoT, only 7% had experienced no proof-of-concept project failures.

The Microsoft study, conducted in conjunction with BCG Group, reported that 30% of decision-makers estimated that between half and all of their proof-of-concept projects had failed, while 31% said they had experienced a moderate level of failure, with between a quarter and 49% of their trials failing.

The survey also found that 32% of decision-makers had a low rate of failure in trials and proof-of-concept projects. Overall, the survey showed that a quarter of enterprise decision-makers are having strong success with IoT implementation, while others have room to grow. 

Of the 419 decision-makers who said they had experienced success with IoT, Microsoft and BCG reported that low-success companies are more likely to say they don’t have enough workers or resources.

The study found a strong correlation between management buy-in and IoT trial or proof-of-concept project success. The main reasons decision-makers gave for IoT project failures included the high cost of scaling, pilot projects that demonstrated unclear business value, and when the return on investment was hard to justify a business case without a short-term business impact.

Other factors that decision-makers said had contributed to project failure included a lack of necessary technology and lack of leadership support and attention.

“Successful IoT projects start with a clear understanding of the business problems to be addressed, the investment needed and the return on investment that is expected,” wrote Sam George, head of Microsoft Azure IoT, in a blog post. “The companies that think about technology roadmaps and plan for the infrastructure needed to scale IoT solutions are better positioned for long-term success.

“Involve leadership early as proof of concepts are being developed and start to have those conversations around future-state technology needs.”