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Addressing the coming IoT talent shortage – Microsoft Industry Blogs

This blog is the third in a series highlighting our newest research, IoT Signals. Each week will feature a new top-of-mind topic to provide insights into the current state of IoT adoption across industries, how business leaders can develop their own IoT strategies, and why companies should use IoT to improve service to partners and customers.

As companies survey the possibilities of the Internet of Things (IoT), one of the challenges they face is a significant growing talent shortage. Recent research from Microsoft, IoT Signals, drills down into senior leaders’ concerns and plans. Microsoft surveyed 3,000 decision-makers at companies across China, France, Germany, Japan, the United States, and the United Kingdom who are involved in IoT.

Exploring IoT skills needs at enterprises today

Most IoT challenges today relate to staffing and skills. Our research finds that only 33 percent of companies adopting IoT say they have enough workers and resources, 32 percent lack enough workers and resources, and 35 percent reported mixed results or didn’t know their resourcing issues. Worldwide, talent shortages are most acute in the United States (37 percent) and China (35 percent).

Of the top challenges that impede the 32 percent of companies struggling with IoT skills shortages, respondents cited a lack of knowledge (40 percent), technical challenges (39 percent), lack of budget (38 percent), an inability to find the right solutions (28 percent), and security (19 percent).

a close up of a logo graph of tech assessment

a close up of a logo graph of tech assessment

Companies will need to decide which capabilities they should buy, in the form of hiring new talent; build, in the form of developing staff competencies; or outsource, in the form of developing strategic partnerships. For example, most companies evaluating the IoT space aren’t software development or con­nectivity experts and will likely turn to partners for these services.

Adequate resourcing is a game-changer for IoT companies

Our research found that having the right team and talent was critical to IoT success on a number of measures. First, those with sufficient resources were more likely to say that IoT was very critical to their company’s future success: 51 percent versus 39 percent. Hardship created more ambivalence, with only 41 percent of IoT high performers saying IoT was somewhat critical to future success, whereas 48 percent of lower-performing companies agreed.

Similarly, companies with strong IoT teams viewed IoT as a more successful investment, attributing 28 percent of current ROI to IoT (inclusive of cost savings and efficiencies) versus 20 percent at less enabled companies. That’s likely why 89 percent of those who have the right team is planning to use IoT more in the future versus 75 percent of those who lack adequate resources.

IoT talent shortage may cause higher failure rate

Getting IoT off the ground can be a challenge for any company, given its high learning curve, long-term commitment, and significant investment. It’s doubly so for companies that lack talent and resources. IoT Signals found that companies who lack adequate talent and resources have a higher failure rate in the proof of concept phase: 30 percent versus 25 percent for those with the right team. At companies with high IoT success, the initiative is led by a staffer in an IT role, such as a director of IT, a chief technology officer, or a chief information officer. With leadership support, a defined structure, and budget, these all-in IoT organizations are able to reach the production stage on an average of nine months, while those who lack skilled workers and resources take 12 months on average.

Despite initial challenges, company leaders are unlikely to call it quits. Business and technology executives realize that IoT is a strategic business imperative and will be increasingly required to compete in the marketplace. Setting up the right team, tools, and resources now can help prevent team frustration, business burnout, and leadership commitment issues.

Overcoming the skills issues with simpler platforms

Fortunately, industry trends like fully hosted SaaS platforms are reducing the complexity of building IoT programs: from connecting and managing devices to providing integrated tooling and security, to enabling analytics.

Azure IoT Central, a fully managed IoT platform, is designed to let anyone build an IoT initiative within hours, empowering business teams and other non-technical individuals to easily gain mastery and contribute. Azure includes IoT Plug and Play, which provides an open modeling language to connect IoT devices to the cloud seamlessly.

Additionally, Microsoft is working with its partner ecosystem to create industry-specific solutions to help companies overcome core IoT adoption blockers and investing in training tools like IoT School and AI Business School. Microsoft has one of the largest and fastest-growing partner ecosystems. Our more than 10,000 IoT partners provide domain expertise across industries and help address connectivity, security infrastructure, and application infrastructure requirements, allowing companies to drive to value faster. 

Learn more about how global companies are using IoT to drive value by downloading the IoT Signals report and reading our Transform Blog on IoT projects companies such as ThyssenKrupp, Bühler, Chevron, and Toyota Material Handling Group are driving.

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Author: Microsoft News Center