Talking 2017 With Tony Harris

With the first month of the year behind us, the electronics industry has given us a lot to pick our brains about in 2017. Will there be a bounce back in wearables? Perhaps, a new non-exploding Galaxy Note? More connected devices to make our lives at home even more digital?

Whatever the case may be, I sat down with industry thought-leader and Octomyze Strategist Tony Harris to talk about trends and insights to watch for in 2017.

Jerrica White (JW): What was the most important event, acquisition, trend, or lesson learned in the electronic component industry last year (2016)?

Tony Harris (TH): I believe the most important acquisition of 2016 was Avnet’s acquisition of Premier Farnell, for a couple of reasons. First of all, I always think of the term “build versus buy.” I think what was so interesting about the Avnet acquisition, with Avnet being the largest distributor of board level electronic components in the world, is that they own the production level of distribution. By acquiring Farnell, it has given them the full life cycle capability.

JW: Full life, meaning from prototyping to production, right?

TH: Yes, now they have access to prototyping, engineers, and hardware designers. They have ideation to production capability, with a global reach — literally overnight. That is game changing. They are positioned for a very unique opportunity for a number of years to come.

JW: How do you think this will inform strategy for distributors moving forward? What will companies learn from this?

TH: A company the size of Avnet is now going to touch those customers that are ideating or in prototyping and then they can move them up into production because that is what they know well. Makes sense? It’s going to change the strategy for all the distributors because you’re no longer going to look at Avnet as just production, but a full life cycle distributor. And that’s a different phrasing. I think it’s going to alter how everyone goes to market, how they launch new products, how they drive customer count— it changes how the market sees itself.

JW: Automotive and IoT continue to grow. Could you speak to the importance and opportunities found in these industries?

TH: I think the key insight is it’s wonderful to see that designs are coming to automate life via automotive and industrial products and it’s happening at such a fast pace, with products that are small, efficient, and simple to activate. Automotive is going to continue to grow exponentially. I think the other side is a bit unknown.

JW: Unknown projects? Unknown risks?

TH: Well, the protection strategy. The strategy to ensure that IoT devices are not hackable. Who is going to develop a firewall to protect IoT devices from disruptive behavior? Say you’re driving a car with automation, who is going to stop your car from being hacked and that someone else does not start driving for you? Kind of a weird thought, but there hasn’t been a lot of discussion around this, to the level you probably will hear about in 2017. My hope is that the major players will be transparent around hacking issues and safety.

JW: Speaking of cars, I was just recently in Havana, Cuba, and I noticed that all of the 1950s Chevrolets, despite the overall condition of the car (which in some cases, was poor), had extremely up-to-date stereo systems. Even some with monitors. I think automation in cars is really fascinating. 

TH: Yes, I have another insight around automation! I think there is a wonderful opportunity to enable a broader audience through aftermarket IoT devices that can be installed on, say, late model cars or even farming equipment. Not everyone can afford a Tesla or have a total home control solution, but if you lean toward accessibility, you can grab the consumers who can’t get on board during early adoption. IoT aftermarket is going to be a great opportunity.

JW: In light of Brexit and a new president in the United States who has already made several changes in tariff and trade regulations, what changes, if any, do you see this bringing to our industry?

TH: I might come at that a couple of ways. I believe the Brexit decision will create some uncertainty in the UK and European supply chain. My sense is that it will take a while for that to happen, but companies will need to recalibrate their approach to distribution, and if you’re running an e-commerce site, you’ll have to be thinking about logistics, especially if you ship out of the country. I feel like folks like FedEx and UPS will be the first to feel the change, but it’s going to cause everyone to reshape their logistics. The movement of goods will be impacted, and retailers, manufacturers, and distributors will be dealing with new regulations and trading requirements.

In some ways, Trump’s ascension to the presidency is kind of similar to Brexit. The challenges that we will face are likely to disrupt trade, and the change is going to be significant and uncanny.

JW: I'm curious to hear about some of the most intriguing hardware or IoT startups or projects that you've come across as of late.  

TH:

Oaklabs (http://oaklabs.is/): Oaklabs is transforming the in store experience— this is IoT, this is going to change retail by connecting offline and online retailers with your shopping. This is the most intriguing startup to me!

Athos (https://www.liveathos.com/) You think Nike is hot? Under Armor? Well this is next. You have this hooked to your phone and your garments. It’s down into your muscle trajectory, and how it’s forming. This could go to troops or fire fighters— people who are in extreme conditions. It will show how you’re performing in these conditions.

Volumetric (http://www.volumetricinc.com/medical/): IoT dispensing. On the personal side, it has a subscription service, like Shave Club, and you can use their click stick to dispense the perfect amount of deodorant. Their goal is to change the medical industry with their metered dosage smart applicator.

JW: Any parting words of wisdom?

TH: I have this phrase: a great January doesn't make for a great year. You’ll hear distributors and manufacturers talking about how we came out of the gates really strong, we’re looking good. Last year didn’t feel like this — last year was tough all year long. For hardware, 2017 will be not a breakout year, but a shake-out year. I think there will be new designs and new products hitting the market at higher velocity that will be faster, smaller, and more cost efficient than ever, which will be a catalyst for new product launches across the industry.

 

More About Tony Harris:

Currently the Founder and Chairman of THINC B2B Digital Marketing & Management Consultants, Tony is a highly-regarded multi-vertical/omni-channel B2B marketing strategist and intrapreneur. His expansive career includes providing executive counsel to some of the most recognized brands embraced by consumers and shareholders alike. He commands proven capabilities as an executive with extensive strategic and tactical execution experience in the areas of distribution, wholesale, industrial, technology and product marketing. Tony serves as a board director or advisor for: Waytek Inc., Merchology Inc., Apruve Inc., and Minnesota High Tech Association.