In a new four-part video series, Jim Heppelmann, CEO of Boston-based tech company PTC and co-author of Harvard Business Review’s November cover How Smart Connected Products are Transforming Competition, talks to McKinsey about how the IoT and smart, connected products impact the design, manufacture, operation, and service of products.
In this, the second video, Hepplemann addresses how smart, connected products will have a dramatic impact on value chains.
Traditionally, the value chain has been constructed around dumb products, unconnected and relatively unintelligent. But today’s products are becoming first-class participants in their own value chains, talking back to engineers, manufacturers, operators, and service providers.
Products can even talk to the sales and marketing department about what the customer is thinking.
“The product becomes a sensor in the relationship with the customer. And this challenges the conventional concept of CRM,” Heppelmann says.
“The idea of customer-relationship management is that customers will talk to you about their feelings about your product. And now, in this new world, we’re going to have products that are early warning devices that tell us about what value the customer is getting or not getting.”
This might include information about how the customer is utilizing the product, what kind of problems are occurring, opportunities for upsell, and when replacements are needed.
This new “smart” value chain is revolutionary, says Heppelmann, impacting every facet of business from how products are created and sold, to how they are serviced and operated.
Stay tuned to learn about the risks of the IoT and how your company can plan for a smart, connected future.