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The Amazon Way on IoT: 10 Principles for Every Leader from the World's Leading Internet of Things Strategies (Volume 2) Paperback – October 28, 2016
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About the Author
John Rossman develops and implements innovative business models, technology strategies, and operations improvement for Fortune 500 companies in industry sectors ranging from high tech, to philanthropy to retail. He currently works as a managing director for Alvarez & Marsal, a global, professional services firm that delivers performance improvement, turnaround management, and business advisory services to organizations seeking to transform operations, catapult growth, and accelerate results through decisive action. Prior to A&M, John served as director of enterprise services at Amazon.com, where he developed the Merchants @ program, a B2B network that enables millions of sellers to offer products through Amazon, which now is over 40 percent of all orders. He also ran the relationships with enterprise clients like Target.com, Toys “R” Us, Sears.ca, Marks and Spencer, and the NBA. John lives in Seattle, Washington with his wife and two sons. He holds a BS in industrial engineering from Oregon State University. --This text refers to the Audio CD edition.
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Top Customer Reviews
The book reviews a lot of Amazon's successes and a few of its failures. It provides a catalogue of questions to ask when thinking about how to innovate or create a new business, up and down the value chain. I would say it's 80% about Amazon, and only 20% specific to IoT.
However, the author also seems to pull everything under the IoT umbrella, thereby undermining the value of the book in my opinion. For example, the thoughts on business model innovation are not specific to IoT, but reflect a more general shift in business strategy over the last decade. Things like minimum viable product have been elaborated on in Eric Ries's 2011 book "Lean Startup". In 2009 Eric said: “Startups exist not just to make stuff, make money, or even serve customers. They exist to learn how to build a sustainable business.” This certainly also applies to IoT, fair enough, but it's not something unique to your company's IoT strategy.
Similarly, thoughts on agile execution are also not new or particularly IoT specific. We know that to innovate a business needs to find a balance between trying new things, executing well to scale (persevere), and on the flip side failing fast, learning from a failed experiment and trying something else (pivot). No business or leader can make all the right calls, as is evident from the high profile failures of even the best companies. In this context, to describe the Amazon Fire phone and its $170M inventory write-off as an experiment is a bit of a stretch. It was a costly mistake that only few companies could recover from. And to label the Fire phone as an IoT device is a bit of a stretch - looking through the IoT glasses all of a sudden every product or service looks like it's somehow enabling an IoT strategy…
Likewise, there is this hindsight bias about customer obsession. Steve Jobs was famous for insisting on insanely great products. Peter Thiel in his 2014 book "Zero to One" states that an innovation needs to be an order of magnitude improvement over existing competitors to have a chance of disrupting the market. Again, there were some interesting new features in the Fire phone such as its dynamic perspective 3-D effect. In a 2015 Fast Company article "The Real Story behind Jeff Bezos's Fire Phone Debacle" one could read that team members couldn't think of useful scenarios for this 3-D effect and the answer to the question why it was built at huge costs was simply "because Jeff wants it". In other words: Jeff lost sight of customers. But didn't Steve Jobs famously state that you can't ask customers what they want, instead you have to invent new experiences for them. So if a billionaire CEO bets big money on a particular development which customers ultimately reject, it was a learning experiment. When the market embrace the new device or service then we are told it's because the CEO obsessed about customers…
There are few examples of ideas for IoT / cloud enabled new business models in this book, such as the experiment in Germany to deliver packages to cars (instead of homes) and deposit them in the trunk which would open with a one-time code. Or the HVAC company with sensors in the air conditioning units to provide alerts when the filter was last changed. Some good nuggets there, but not what I expected.
In summary: This book is rehashing ideas and principles from the first book with IoT dressing for some sizzle. But it offers few IoT specific examples or guidelines.
Rossman provides an overview of the IoT Technology Chain, from devices and sensors that collect raw data around human behavior to how companies analyze that data, learn from it, and provide valuable insights into predicting their customers’ future actions. That smartphone in your pocket is perhaps the best example of a general-purpose IoT device that has become an indispensable part of our lives and a tremendous opportunity for new products and services. A well-crafted smartphone app can replicate the function of a dedicated IoT device, such as the Amazon Echo, smart TVs or heart rate monitors. The book helps business owners understand the trade-offs on how to leverage IoT apps, dedicated devices and services into their own businesses.
The book also covers topics beyond IoT devices, introducing a new breed of business models made possible by IoT. This is perhaps the most valuable takeaway from the book for owners of more traditional businesses. Several chapters demonstrate how businesses can start small and scale up using IoT devices, apps and cloud-based services. Other chapters discuss creating new revenue streams by building platforms and data access points for other companies to utilize. A highly recommended read.
"…. methods are situational. In the companies I’ve spoken with, there are few golden rules, but there are powerful leadership dynamics that underlie each organization’s methods. Those dynamics have had an oversized influence on these companies’ successes—or lack thereof."
The book then lays out an overview of the important concepts and technologies in the IOT space, according to the Amazon guiding principles… scattering in interesting examples from Amazon dash, echo, and AWS… It is really a quick, interesting and informative read and I could picture it being helpful for both companies looking to get into IOT as well as consultants supporting those companies.