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Intellectual property Opportunities in the Machine to Machine (M2M) Market
Intellectual property Opportunities in the Machine to Machine (M2M) Market Opportunities in the Machine to Machine (M2M) Market |
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Page 3 of 3 Strategy Development in M2M Just as the internet stimulated thousands of new businesses and so called ‘business models’. Most of those businesses failed as a result of poor strategy development. By 2001, the dot com crash drove home the message that good strategy requires a focus on increasing return on investment. Indeed, the reputation of several management consultants was tarnished at the time, including the market departure of Andersen Consulting. The idea that value is generated by growth in market capitalization is illusory if it is not backed by net revenue growth as a percentage of investment. Eventually, the market capitalization dissolves. M2M is likely to drive the same explosive interest. M2M applications can drive down business costs and business will pay a proportion of that saving for cost reduction. (eg reducing equipment downtime and maintenance costs) M2M applications create new services which, if they don’t drive down costs, create greater value for which customers will pay a premium. (eg 24/7 healthcare will be highly valued by a segment and may be demonstrated to lower health costs simultaneously) Both examples illustrate opportunity – but strategy development is required to ensure there is indeed, a competitive advantage capable of delivering superior return on investment. 
Competitive advantage is still one of the best measures strategic thinkers have for determining whether or not a course of action is likely to improve return on investment. 1st mover is not an advantage if it does not reduce the competitiveness of other players in your target segment. A ‘business model’ that mathematically makes money is not a guarantee of success if the model does not deliver you a standout result in a high demand target market with either a sustainable cost advantage or sustainable difference that is highly valued.
The Business Case in M2M Whilst many developments in M2M are high risk, they also offer high reward. The opportunity for reward however, is derived from a clearly articulated strategy that demonstrates a sustainable competitive advantage and growing return on investment. No matter what industry sector, biotechnology, ICT, transport, environment, security or any other, it is important for strategic planning to move beyond the technological potential to deliver benefits, to a strategic plan that delivers:
Disciplined strategy development can protect M2M from a ‘dot-bomb’ experience and instead, create tremendous business value. For more information, see TMG Management Consultants. 
With more than 21 years in management consulting, TMG has conducted strategy development projects working with Virgin Mobile, Telstra, Optus, Nextep (NEC), Compaq and many others leaders in the ICT market.
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Melbourne 03 9010 9010
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Balwyn North - Victoria 3104
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