Value Creation from the Internet of Things in Heavy Machinery: A Middle Manager Perspective

We develop a novel understanding of value creation from the Internet of Things (IoT) in the heavy machinery industry. We analyze the operational middle management perspective on the current state of IoT implementation in four industry segments utilizing heavy machinery, including chemicals, electrical equipment, marine, and pulp and paper. We find four value drivers from IoT (product optimization, maintenance and recovery optimization, energy efficiency, and safety improvements) that pertain to the underlying joint value driver of predictability with operating heavy machinery. Furthermore, we outline current core issues and constraints in IoT data utilization and value realization in the heavy machinery industry. Our findings expose how middle managers recognize high value potential from IoT implementation but indicate only gradual value capture if data gathering, knowledge sharing, and data analytics are not improved. Architectural transformation programs that include establishing knowledge-sharing hubs and connected expertise between organizational units, external experts, and suppliers are needed to unlock the full novel value-creation potential of the IoT in heavy machinery.