IoT: Scale for success
Overcoming the challenges of designing, deploying and managing mass IoT
Foreword
Software AG continues to support research into the Internet of Things (IoT). We’ve conducted extensive market research and sponsored many independent studies. Our goal is to learn more about the state of the market and provide companies considering the technology with more information to help them make a success of their IoT projects.
As part of this program, we sponsored the latest report in the “Succeed with IoT” series from Beecham Research (Beecham). “Getting to Mass IoT Deployment: Challenges and Opportunities” is based on a survey of senior executives from companies covering a broad range of specialized IoT-based services.
In this report we take a critical look at Beecham’s findings and provide recommendations on addressing the challenges that the report identifies.
The issues faced when scaling IoT solutions are significant and can lead to project failure. Getting to Mass IoT Deployment: Challenges and Opportunities investigates how far along companies are at deploying IoT at scale and the issues they have faced. We are grateful to sponsors like Software AG for supporting this research and making it openly available.
State of the market
Connected devices are everywhere
Data from the Global mobile Suppliers Association (GSA)—a not-for-profit industry organization representing mobile communication companies worldwide—shows that there were 13.2 billion connected devices in 2022.1 It expects that to increase to 34.7 billion within five years—compound annual growth of over 20%, or more than 136 devices per second. Ericsson (40.2 billion by 2025) and IDC (55.7 billion by 2025) expect even faster growth. Projections vary, but even taking the least ambitious forecast, the number of connections is set to grow rapidly.
The scale of IoT projects is growing. When Beecham asked how many devices are in their largest current IoT deployment, nearly 20% of organizations said they had a project involving more than 10,000 devices. Nearly half (45%) of organizations had a project with more than 500 devices. Companies have scaled to these massive numbers even though the overwhelming majority of the largest deployments (78%) started with under 500 devices.
And they aren’t stopping. Over half (53%) of respondents said that they expect their largest deployment to grow by more than 20% over the next three years. Over a third (35%) expect growth of 40% or more.5
Ambitions are growing, and that brings new challenges
It’s not just the number of devices or the number of projects that’s growing. Having seen the benefits, companies are increasingly looking to IoT to help them meet their business objectives—such as increasing efficiency, improving safety and enhancing sustainability.
Internet of Things (IoT) agendas are becoming increasingly ambitious. Clients demand strategic roadmaps with a compelling vision and scalable implementations that yield measurable ROI.
The challenges of scaling IoT solutions
The Beecham research identifies nine challenges companies face when expanding IoT projects. We’ve grouped these into three categories:
- Designing and deploying solutions
- Managing solutions
- Integrating and using the data gathered
1. Designing and deploying solutions
Solution design
Building a proof of concept is one thing. An at-scale solution brings many new challenges. Even a solid production design can require development to roll out at scale—whether that’s hundreds of devices or tens of thousands. Every aspect of solution design must be considered for its suitability as the number of devices grows. Connectivity options may need to be considered. Component choices may have to be reviewed. And what data is captured and stored should be carefully assessed.
Ask consumers, enterprise customers, or governments, and many will cite installation as one of the biggest cost issues in the deployment of IoT solutions at scale. Interoperability challenges mean that almost every at-scale deployment requires customization, if not an entirely bespoke solution. The complexity of seemingly straightforward tasks, such as obtaining secure connectivity, retrofitting old devices, and linking into existing systems, adds difficulty, time, and cost, which discourages at-scale deployment.
Solution design isn’t just about the technical components. As the number of devices grows, the importance of robust processes increases as well. Automating the on-boarding of new devices ensures consistency and security. Organizations need to make bulk firmware and software updates regularly. Off-boarding should also be considered as part of solution design because failure to treat decommissioned devices properly can lead to security vulnerabilities.
Reducing manual process is critical to reducing provisioning, and decommissioning, costs, which is important for ROI and scalability.
IoT platforms can help you reduce development time and de-risk your IoT investments. Pre-integrated platforms offer “ready to go” capabilities for connectivity, device management, application enablement, systems integration and analytics. This will allow your team to spend less time worrying about the “plumbing” of how to connect things and devote their energies to building better applications and finding more ways to use the data.
Security
Security is a common concern for all new technologies. And IoT is no exception. In the early days of IoT it was common to read about researchers demonstrating proof-of-concept attacks on devices. Things have changed a lot since then, but as the understanding of the problems has improved, so have the stakes. The attacks have evolved from theoretical to a day-to-day reality.
And the consequences of a failure can be extreme:
- The more critical connected devices become to how you, and your customers, do things, the bigger the problem is when they don’t work
- The volume and importance of data gathered is growing fast, upping the consequences of exposure
- Stealing data isn’t the only way to compromise a company, tampering with data could lead to ruinous consequences—and not just financial impacts, look at the attacks on water-processing plants and other critical national infrastructure
- Connected devices can be a gateway to other devices and systems, including cloud-based applications
As a business, it’s not just your own data you need to worry about, but also the data you gather from customers and partners. And loss of data isn’t the only concern. A security incident could lead to the compromise of other systems and downtime.
An IoT platform can make managing the security of IoT devices much easier. It can help you simplify the addition of new devices—critical if you’re going to have thousands of them—and enforce minimum security standards. It can also help you protect data by implementing segmentation and encryption. These help to keep IoT data away from prying eyes, whether they be hackers or other users.
Restricting access to data on a “need to know basis” is a basic security principle. An IoT platform can help you to implement role-based security. This makes it easier to manage what data different groups have access to and what they can do with it.
Compute and storage
Cloud computing was one of the early enablers of IoT. It provided users with access to an enormous variety of applications and tools, incredible flexibility and low fixed overheads. The availability of cloud-based tools to accelerate development and manage IoT solutions support has grown apace. Processing IoT data in the cloud is fine for most applications, but it can be expensive and “slow” for some use cases. And that’s where edge computing comes in.
By processing the data nearer to where it’s gathered, almost instantaneous responsiveness can be achieved. Key applications for this include safety applications, where milliseconds can make a massive difference, and autonomous mobile robots.
In practice, it’s common to blend cloud computing and edge computing to get the best of both. Processing data on a local server (thick edge) or even compute resource built into the IoT device (thin edge) can increase responsiveness and help reduce bandwidth and cloud storage requirements, cutting running costs.
One of the critical decisions when implementing an IoT project is “build or buy”:
- Building a solution yourself means that you have total control, and you can build something completely bespoke. It could also lead to problems getting the right talent, project delays, and having to learn through trial and error.
- Buying a solution comes with the risk of paying more and having less control—though it doesn’t have to be like this. An experienced third-party could help you to navigate the pitfalls, reduce the total cost of ownership and bring in knowledge from other industries that could prove invaluable.
But why choose? It doesn’t have to be an either-or decision. A “buy and build” approach could give you the best of both worlds.
Buy and build: the benefits
Faster to build
- Avoid skill shortages
- Run with reliable, secure operations
- Accelerate value by learning from the experiences of others
Easier to scale
- Build scalability in from the outset
- Scale and make changes faster with a self-service platform
- Integrate with existing applications
Evolve with the market
- Leverage open-source to keep your options open
- Minimize total cost of ownership
- Enhance the customer experience
- Serve every stakeholder
2. Managing solutions
As the number of devices grows, device management becomes more challenging, but visibility of the entire device estate is essential. To make the most of IoT, you need to be able to connect new “things” quickly and update and maintain those things easily. That’s where an IoT platform comes in.
What is very important is that updating is designed from the very beginning, that means you integrate that on the hardware design (to be updated remotely). And very importantly it is using a powerful network management platform.
Make sure you choose a platform that’s based on open standards and is designed for rapid application deployment. This will enable you to connect devices fast—often without coding.
Check that the platform you choose has an open API with strong community support. This will be key to expanding your IoT capabilities and getting the most from your investment.
It’s also important that your platform supports over-the-air updates. This is particularly challenging with low-sophistication devices. These devices may have very little on-board computing power and very limited connectivity. Delivering an update could also have a significant impact on battery life.
3. Integrating and using the data gathered
Even the smallest IoT project can deliver meaningful business benefits, but the use of analytics to make better use of the data gathered is a key indicator of solution maturity and predictor of success. But few companies have the necessary integration and data analytics expertise required to get the most out of the IoT data they’re gathering. And there’s extensive research to suggest there’s a significant skills gap.
Many companies now have multiple IoT projects, each gathering data independently. While these projects may be successful in their own right, they could deliver greater benefits by adding analytics capabilities.
Data from an IoT project can often have multiple uses—for example, data from a fleet tracking solution might help improve maintenance routines as well as optimize route planning. The old saying about “the whole being greater than the sum of the parts” also applies. That same vehicle data, when combined with employee schedules, could identify the safest, most efficient drivers and who might need additional training.
IoT isn’t just about analyzing the past. Many companies are now combining IoT from a multitude of sources to create a “digital twin”. As well as helping to analyze data and understand dependencies, a digital twin can help you model the impact of potential changes. For example, you could see how reorganizing the factory floor to accommodate a new piece of equipment would affect operations.
Leveraging external expertise for integration and analytics could be much easier than trying to recruit and retain these skills internally. This could help improve achieve value more quickly and realize greater ROI.
While IoT technologies are maturing, customers’ expectations have changed from a technology-centered approach towards focusing on how to achieve measurable business outcomes delivered by IoT platform-enabled solutions.
As well as technical skills, a third-party could bring additional insight. A partner with extensive IoT experience could recommend ways to get more from the data that you collect.
Benefits of an IoT platform
An IoT platform can:
- Reduce development time and cost
- Cut time-to-market
- Increase security
Questions to ask when comparing IoT platforms
1. Designing and deploying solutions
- What are the technical barriers to entry?
- Are the costs transparent?
- Do the costs scale smoothly with use?
- Does the platform have an established ecosystem of partners?
- Does it have built-in security controls?
- Is it robust?
2. Managing solutions
- Is the platform scalable?
- Is performing day-to-day tasks easy?
- Can deployment and management be automated?
- Can you add new devices and protocols easily?
- Is it portable between cloud hyperscalers?
- Does it offer alerts for abnormal usage patterns?
3. Integration and using the data gathered
- Does it offer comprehensive and customizable analytics?
- Is it open, not reliant on proprietary formats?
We saw a high degree of commitment from Software AG. [Software AG] puts its best people on the project.
Don’t get left behind
Expectations of IoT have changed. That’s because IoT is so closely tied to achieving key business objectives such as increasing innovation and competitiveness, leveraging automation to improve efficiency and safety, making supply chains more efficient and resilient, reducing waste and improving sustainability, and getting closer to customers and delivering better experiences. As a result, projects are increasingly focused on measurable business outcomes.
IoT offers companies many opportunities to differentiate themselves. But to achieve this, they cannot rely solely on off-the-shelf software. They need to build their own business applications which enable new capabilities, while being tightly integrated with enterprise systems and processes.
Combined with the challenges of recruiting and retaining the right expertise, this is driving companies to look outside for support.
Choosing partners with the right technology, ecosystem and expertise can help to:
- Accelerate time-to-value
- Reduce burden on IT
- Support broader ongoing digital business transformation efforts
The time to act is now
Software AG understands what it takes to make IoT projects successful—no matter how many devices are involved. Wherever you are on your journey we can help you achieve more. Our approach focuses on going at the speed that’s right for your organization and customers, while always striving to deliver “faster to build, faster to value, and faster to grow.”
1 Year
A Forrester Total Economic Impact study found that a typical company using Software AG’s Cumulocity IoT platform achieved payback in one year.*15
Why Software AG
The connection of people, technology and processes creates the connected experiences that are expected by your employees, partners and customers. To deliver those experiences, you need a truly connected enterprise that turns your data into value through deeper analysis and insights that lead to new business models.
But the digital transformation required to meet those expectations is increasingly complex and more difficult to navigate with constantly changing needs. A misstep today can have a lasting impact on your ability to compete in the future.
We can help simplify the truly connected enterprise where systems integrate more seamlessly, technology connects more effectively, and processes run effortlessly enabling information and insights to flow more freely. But no two enterprises are alike; no two solutions identical. We have award-winning technology and expertise to be your partner. We will listen and understand your challenges and work side by side with you, anticipating the next challenge, to meet and exceed expected customer experiences so you can win against your competition.
Together, we can simplify the connected world by connecting people and technology for a smarter tomorrow.
Wherever you are on your IoT journey, Software AG can help you make the most of your investment and achieve the best outcomes for your business. Our enablement services and partnerships can help you develop and deploy your solutions faster while our proven project methodology, solution accelerators and reusable processes can accelerate your time to value.
In today’s rapidly changing environment, companies must leverage digital capabilities to develop compelling products and services, understand customers, and grow new revenue streams. Software AG’s Cumulocity IoT platform enables businesses to quickly deploy IoT applications, collect and act on data, and integrate IoT with a wide variety of devices and enterprise applications. According to customers, the platform removes technical complexity from IoT projects, enabling business leaders to focus on business outcomes.
