May Event Review: “Product Management for the Internet of Things (IoT)” with Daniel Elizalde, Founder of TechProductManagement
By Dan Galatin
Daniel Elizalde presented a fascinating talk on what it takes to manage products for the Internet of Things at the May 3rd meeting of the SVPMA. There is a tremendous amount of hype surrounding IoT, starting from the oft-repeated claim that by 2020, there will be 50 billion connected devices. Many products have been introduced that don’t appear to be that useful, sometimes laughably so (a connected fork or a smart egg tray, anyone?). Nevertheless, there are also many products that have significant impact on our daily lives (such as the Nest thermostat and critical infrastructure monitoring). The number of companies involved in IoT presents a tremendous opportunity to product managers. In 7-10 years, the majority of products will be connected.
The problem is that managing an IoT product is much more complicated than managing a standalone hardware or software product by itself. Daniel described the definitional components of an IoT product via the example of wind turbine predictive maintenance. IoT products consist of:
– Device hardware
– Device software (embedded in the device)
– Communications infrastructure
– Cloud platform (analytics, computing power, etc.)
– Cloud applications
Each of these components in the technology stack have different requirements and timeframes to manage. Fundamentally, product managers need to consider IoT to be a set of tools that allow us to figure out a solution to a problem. For example, the Brita Infinity water pitcher was enhanced to automatically order water filters when they run out. IoT just happened to be the best solution to the problem of replenishing filters for consumers.
Daniel next introduced his IoT Decision Framework. Bridging the gap between product strategy and product planning for IoT products is very complex, and the framework provides a strategic tool to help do this. The framework is a matrix consisting of the five components of the technology stack, combined with the following decision areas:
– Standards & Regulations
Using the framework, you consider how each of the decision areas impacts each of the technology stack components. In the UX decision area, you figure out who are the users (both internal and external) and what their needs are, at each layer of the technology stack. Next, you decide what data flows through each of the technology stack layers, and how it needs to be processed and stored. The business decision area involves thinking about how you are going to monetize the entire solution, or each of the layers. You need to consider costs and build/buy/partner decisions. As is typical in product management, Daniel suggests not starting with technology decisions, but rather first thinking about the need, how you will make money, and then considering what technology will be required at each layer in the stack to deliver the solution. You then need to figure out how you will secure each of the layers. This is very important and not an afterthought – it needs to be considered early in the planning stage before anything is built. Finally, understanding standards and regulations is critically important especially if you’re going to sell into a regulated industry like energy or healthcare.
It’s important to iterate once you go through the framework, since each of the decisions in one layer will impact each of the other layers. Eventually, you will get to a steady state of consistent decisions. Daniel advocated using this framework not just for creating for new products, but also for defining new features and evaluating potential partnerships. He then ran through a quick example of applying the framework for thinking about data considerations at each layer of the IoT stack for the Nest thermostat.
Daniel concluded with some key takeaways. Building IoT products is hard because of the complexity of the multiple components and decisions that are involved. More and more products will become IoT products, so professionally we can’t ignore this trend. Therefore, the more you stay ahead of the curve and learn about product management for IoT, the more likely you are to grow your career!
Dan Galatin has over 20 years of combined experience in product management and software engineering. He is Director of Communications for the SVPMA and can be contacted at firstname.lastname@example.org.