Top challenges of IoT adoption in the enterprise

Identifying the value proposition

Shinano Kenshi Co. Ltd. develops, manufactures and supplies precision motors for business customers that use the equipment in their own products that are then sold to other customers. As such, identifying what benefits IoT technology could yield presented some challenges for Shinano Kenshi executives.

"Our business is business-to-business, so we had to see if IoT would be good for our customers, the OEMs," said Marcel Azary, senior vice president at Shinano Kenshi. "We are a 100-year-old company and our core technology is a motor. It's mechanical -- something you can hold in your hands. But IoT was something totally different, and getting into the data and the intelligence and analytics was something different for us. We had to go beyond the hype. We wanted to know the actual value."

Marcel Azary

Azary said he and his colleagues worked with an IoT provider to address the technical acumen needed for an IoT implementation, something the company started in the past few years and is moving forward with in 2019. That left executives to identify potential use cases that could benefit the company and its customers. More specifically, Azary said they focused on using IoT to draw data from their motors and identifying how that data could be useful for customers in different industry segments, from automotive to medical.

"It was a shift in mindset for us to think like a customer, so when we sit in front of them, we can pinpoint the real value of IoT," he said.

Getting buy-in

Even as he worked with colleagues to identify how IoT could produce data-driven insights for customers, Azary said he needed to convince others within his own company of the market value that investments in IoT technologies could reap. He took a typical approach, identifying potential champions within his own company, as well as at customer companies, and getting them on board with the vision.

"I [needed] to sit in front of the right person. You have to be almost like a consultant to get your point across, but the ones who see it and grasp it are the ones who will push it forward," he said, noting that Shinano Kenshi is now engaged with 25 of its customers working on IoT initiatives.

Ensuring security

Chris Dimitriadis, group director of information security at Intralot, a Greece-based lottery vendor and operator, said security issues are present throughout the IoT chain -- from endpoint hardware through the network that carries the data to the enterprise systems that hold all the data.

"That is a challenge because there are not a lot of security processes in place with the individual components," said Dimitriadis, who is also a board member with the international IT governance association ISACA.

Chris Dimitriadis

He said one of the most cited challenges of IoT adoption is the variety and number of security threats they can encounter. They might have trouble recognizing, authenticating and managing the endpoint devices that connect to the organization's network. Or they might struggle to secure the flow of data coming from those devices. And they often worry about whether they could effectively handle an incident should a threat or breach occur.

And, as is true with other security challenges, there's no one single solution that solves for all those pieces, Dimitriadis said.

"You need to have a holistic cybersecurity framework to understand how devices collect information, how they connect [to your systems], how they're authenticated, how they can be managed, how they can be stopped or wiped in case of an incident, and how this information flowing from the device to the end destination can be secured," he said.

Dimitriadis added that Intralot uses unified endpoint management as part of its broader security framework to help secure its IoT programs. He also said his company upgraded its event management systems to better address its detection and response protocols should there be an incident within the IoT technologies.

Making IoT work with legacy systems

As Carl R. Darnall Army Medical Center in Fort Hood, Texas, moves ahead with adding more endpoint IoT devices, its CIO, Lt. Col. Chani A. Cordero, said the facility's legacy systems are slowing down the efforts.

"We have a lot of disparate systems that don't communicate with each other," she said, explaining that the plethora of legacy systems has made taking in data from endpoint devices one of its biggest IoT implementation challenges.

Lt. Col. Chani A. Cordero

For example, Cordero said the medical center uses a variety of connected health devices -- from pacemakers to thermometers to monitors measuring muscle activity -- to collect patient information. That data then needs to move into the systems holding patient records. Yet different departments use different electronic health records (EHR) systems of varying ages with different networking capacities. In fact, she noted that some systems still operate more like stand-alone systems than fully integrated ones.

"Legacy systems were never meant to be interoperable; they were one-trick ponies," she said. "We have stretched the bounds of what they were meant to do, so as more devices come out, the first thing I have to ask is if I can connect it to my existing EHRs."

Cordero said she, like most other CIOs, is moving her enterprise off legacy systems so it will be better positioned to implement IoT and other transformational technologies in the future. However, as that work proceeds, she's also looking to the vendors that supply IoT components to develop products that will work with her existing technology stack.

"Most of our vendors are willing to work with us because we're a big consumer of products," she added.

Handling all that data

Another one of Carl R. Darnall Army Medical Center's IoT adoption barriers is handling all the data produced by the sensors and other IoT endpoint devices, Cordero said.

"With the plethora of data that IoT brings out, we're asking, 'how do we manage that data? And [do] we have the resources we need to store, analyze and do something with all that data?'" she said. "We support the collection of all that data, but the data is only valuable if it can be accessed and viewed so we can make decisions from it."

Erik Caldwell

Erik Caldwell, who as deputy COO for smart and sustainable communities oversees the City of San Diego's smart cities initiative, cited the same challenges of IoT adoption.

"You have to be prepared to use that data and analyze it," he said. "That means having the right skill sets and the right frame of mind from an organizational perspective. It's not just about having a couple of dashboards; it's about how do we use the data to better run the business?"

Case in point: The city uses a third party to process credit card payments made at its parking meters. Caldwell said the city recognized that the third-party company collected data from the meters, so it negotiated for the company to send that data to the city through an API so the city's own data team could analyze it for strategic planning.

Making a financial case

The City of San Diego started on its smart cities work in the early 2000s, using IoT to lower operating costs, improve efficiency and enhance service levels for its constituents.

Caldwell said municipal leaders first considered IoT technologies such as sensors in parking meters, believing that the benefits could help them cope with the city's financial problems. But, before they gave the green light, they wanted to be sure that IoT could deliver.

Caldwell said making the financial case is a hurdle that many IT and business executives face when crafting an IoT strategy.

"You can come up with the best, most innovative ideas in the world, but if you can't find a way to make an economic case for it, it's dead on arrival," he said.

However, Caldwell said he thinks that this IoT adoption challenge has an upside.

"For municipalities, it's a good thing because it forces us to think about good business use cases and how will it help the city save money," he said.

Balancing capabilities with expectations

With analysts and vendors hyping the benefits that IoT can offer, and with sensors and other IoT-enabling components being embedded in a number of consumer devices, executives and everyday workers are considering how IoT can transform their own business processes.

CIOs, however, must balance those expectations against what is really possible, said Joel Jacobs, vice president and CIO of The Mitre Corp., a not-for-profit company with headquarters in Bedford, Mass., and McLean, Va. The company operates multiple federally funded research and development centers.

Joel Jacobs

"In many cases, the organization isn't prepared for the speed at which these things are coming and the rising expectations," he said.

To get in front of that, organizations must determine the speed at which they can implement or expand their IoT initiatives based on whether they have the IT stack to adequately support and secure innovations, the talent to support it and the ability to manage the change that will come with the new technologies.

Jacobs said CIOs, however, can't shut out the technologies just because they're not fully prepared, as employees will find ways to bring them in -- just as they have in the past when enterprise IT said no. So he's using a parallel network to experiment with IoT technologies and the potential challenges of IoT devices as he moves forward with his IoT strategy.

"You have to know how to import those kinds of technologies into a corporate environment," he said. "If we were to fight IoT, as opposed to direct it toward a good outcome, we'd probably lose in the long run because people would work around us rather than work with us."