"Business models are about creating experiences of value," says Aaron McDonald, CEO of Puttiapps.
"With the IoT [Internet of Things], you can really look at how the customer looks at an experience -- from when I'm walking through a store, buying a product, and using it -- and ultimately figure out what more can I do with it and what service can renew the experience and give it new life," says McDonald.
He says organisations that want to benefit from the rise of connected devices -- the "Internet of Things (IoT) - have to prepare for a "different mindset".
"The market stack is deeper than traditional products; you need to think about how your company will monetise your product and how your product will allow others to generate and collect value, too," he points out.
The first to be let go, he says, is the "old traditional product development" where companies "tried to analyst existing customer needs, and then create a product".
The process can take a long time and require significant investment before a product is put on the shelf, he states. Then you hope it gets sold, makes money, and then sell the next product innovation. Meanwhile, the company will protect its business from competitors by owning IP or controlling the supply chain or channel.
"The Internet of Things mindset blows these paradigms away," says McDonald.
Watch: Aaron McDonald on how organisations can build their own 'innovation start-ups'
"You have to think more about predicting customer needs and using the data that is available in the Internet of Things to help you understand what might be next, and having to pivot very quickly inside your organisation by having systems that allow you to change your business model or change your product or change the way your customer experiences your product.
"The pace of innovation is happening so fast you have to think about not locking in your business with IP or channel control, but locking in your customers through superior experiences," he says.
You change the way you engage with customers and cooperate with partners in linking different platforms and products to create a more compelling place for your customers to come back to every time.
"Your revenue is not about selling the next widget; it is actually about how can I create an ongoing relationship with that customer, monetise that relationship over time, and extract value in an ongoing basis with that customer through these new experiences?"
Behave like a start-up
The new technology, meanwhile, landscape also calls for a shift in how the organisation approaches innovation.
"It is important to make incremental changes in the organisation," says McDonald.