The rocky road from hardware luminaires to the world of IoT

The days of the “light bulb cartel” are over. And it is not only compe­ti­tion from East Asia and incre­asing market diver­si­fi­ca­tion by start­ups that are incre­asing the pres­sure on the former top dogs to trans­form. Tech­no­logy inno­va­tions from outside the indus­try are pene­t­ra­ting the market at high speed and are seen as more of a curse than a bles­sing for tradi­tio­nal providers.

The increased conver­sion to LED(light-emit­ting diode) and the asso­cia­ted service busi­ness models such as “Light-as-a-Service” (LaaS — light leasing), as well as the incre­asing demand for “digi­tal”, “smart” and “connec­ted” light­ing infra­struc­ture are seen as future drivers with high poten­tial. The thrust is service trans­for­ma­tion and the deve­lo­p­ment of digi­tal and data-driven busi­ness models.

That’s right. Start­ups in parti­cu­lar are now ente­ring the market as pure LaaS provi­ders — in some cases with hybrid models. The most radi­cal form of this busi­ness model is charac­te­ri­zed by start­ups without lumi­n­aire DNA buil­ding a compe­tence-based eco-system whose value chain is covered by specia­li­zed part­ner­ships. — Paral­lels can also be seen here with models of “servi­tiza­tion” from other indus­tries: be it the sale of “mobi­lity” instead of a vehicle, the leasing of “power to move airplanes in the air” instead of an engine from Rolls-Royce (“power by the hour”), or even the sale of “holes” instead of a drill at Hilti.

For the light­ing indus­try, for exam­ple, this means upgrading indi­vi­dual lumi­n­aires with special sensor tech­no­logy (e.g. Blue­tooth beacons) and thus enab­ling rele­vant data to be gene­ra­ted, evalua­ted and made available to custo­mers at a charge.

The ques­tion is not only which employees need to be invol­ved in such proces­ses, but also how such busi­ness models should be deve­lo­ped and imple­men­ted in the orga­niza­tion from a process tech­no­logy perspec­tive. In this context, the estab­lish­ment of in-house “corpo­rate labs” offers a target-orien­ted option. These serve to promote and deve­lop new busi­ness models, for exam­ple in the form of start­ups with their own incu­ba­tor charac­ter. The goal is to act as a cata­lyst to drive the company’s digi­tal trans­for­ma­tion and realize busi­ness model inno­va­tions by acqui­ring, buil­ding and inte­gra­ting digi­tal start­ups. In addi­tion, brin­ging inter­nal as well as exter­nal employees toge­ther, estab­li­shing a new shared mind­set and consciously thro­wing off the shack­les of corpo­rate thinking.

About Vincent Krause

Vinzenz Krause, M.Sc., Master of Busi­ness Admi­nis­tra­tion in Bamberg, Master program (Euro­pean Human Resource Manage­ment) at LUISS Busi­ness School (Italy), EMLYON Busi­ness School (France) and Radboud Univer­sity (Nether­lands). He curr­ently teaches orga­niza­tio­nal deve­lo­p­ment and digi­tal busi­ness models at WFI — Ingol­stadt School of Manage­ment and Duale Hoch­schule Baden-Würt­tem­berg (DHBW). At IDM, he is respon­si­ble for the busi­ness areas of digi­ta­liza­tion, orga­niza­tio­nal deve­lo­p­ment and data analy­tics. Vinzenz Krause has co-foun­ded two successful start­ups in Munich, among others.

You can read the detailed article by Vinzenz Krause on this subject in the book edition FYB 2020 or in our 
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