As I read "How Smart, Connected Products Are Transforming Competition" by Michael E. Porter and James E. Heppelmann in the November 2014 issue of the Harvard Business Review, I thought the article just scratched the surface of how smart, connected products can transform competition.
To me it seemed like they missed out on a key point on how connected devices can drive corporate collaboration and thereby transform competition.
This article viewed the connected product as a discrete autonomous entity connected to a larger grid. What it misses out is the "swarming" which can happen when these products interconnect with each other (let the image of a murmuration of starlings flash before your eyes - millions of birds swooping as one single shape-shifting entity).
While the authors visualize your toaster connecting to the toaster manufacturer and fridge connecting to the fridge manufacturer; in reality we will have the toaster, refrigerator and all other appliances connecting to each other and transforming our lives (Car notifying the coffeemaker as it approaches the house to make sure a pot is ready for me as I pull into the garage or thousands of discrete store/street cameras collaborating to create a seamless surveillance grid).
This will have an impact on competition too esp. in terms of the opportunities of collaboration which may emerge viz. Will the "swarm" allow devices of other manufacturers to join or will each manufacturer restrict participation to its own products?
Here's what I would like to add to the authors postulates:
- Future of connected devices is not just the device but the "swarm".
- Swarming or the need for swarms will force collaboration between competitors to enable establishment of swarming protocols and inter-connectivity.
- Companies will need to fathom approaches where they compete at device level but collaborate at the swarm level.
- A new kind of player, a swarm manager/enabler, will emerge which will focus on enablement of the swarm and monetizing it. Google could be one such player (Think where Nest may be headed...and the self-driving cars). Social Media companies like Facebook etc. may also move up the value chain from just being people connectors to swarm enablers.
How do you think your company's smart products can be part of a collaborative "swarm" ?
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