The Internet of Things is now on everyone's lips - and not without reason. It's about much more than just ceiling lights controlled via WLAN: The Internet of Things also offers small and medium-sized companies a wide range of application possibilities .
What is IoT actually?
According to Gartner's definition, the Internet of Things (IoT) is a network of physical objects that communicate using embedded technologies to sense and interact with their internal status or the external environment.
More and more companies are using the IoT for their products or services.
Anyone who wants to seize the opportunity and gain a competitive advantage by introducing new technologies should not wait too long.
However, caution is advised:
Poor IoT implementation is worse than no implementation.
After all, the Internet of Things does not offer any value in and of itself. As with software, the value of the Internet of Things lies in the benefits a company gains from using it . And while it has the potential to offer real added value, it also brings with it a lot of technical challenges.
Cloud represents the Internet of Things
The Internet of Things and false hopes: This is not how it should work
Relying on the Internet of Things is not always a success. Emberlight provides an example of a clear failure: The US startup caused a sensation in 2014 with an enormously successful Kickstarter campaign for smart light bulb sockets. The attachments screwed into the lamp transformed normal lamps with LEDs or light bulbs into intelligent, remote-controlled and dimmable lights. But in November 2017, Emberlight had to announce that it was going out of business because the competitive pressure had become too high - and buyers were bitterly disappointed:
It turned out that Emberlight products only worked with a permanent connection to the company's cloud servers . Every command to turn the lights on or off had to be processed by the server first.
With no company paying for the cloud servers anymore, customers were literally left in the dark. Emberlight products had become electronic waste overnight.
This example makes it clear: There is no such thing as a standalone IoT technology, but rather a networked ecosystem of data and devices. If one of these elements goes offline, the entire ecosystem is affected. For a private household, it is annoying but bearable to have invested unnecessary money in lamp sockets that will soon no longer work. For companies, investments can quickly run into millions.
By properly assessing the short-term risks and costs of IoT implementations, SMBs have a good chance of outperforming their competitors in the long term. They can make more informed decisions about IoT strategies, security and business value before making an investment.
In this article, we want to highlight the three main risks that SMEs should be aware of when using IoT and how they can counteract them.
Building IoT strategies – not always easy for small businesses
The challenge: Many companies start implementing IoT elements without having a clear goal in mind.
We often associate the Internet of Things with consumer products that can be connected to the home Wi-Fi network. But according to Gartner research, it is also used by many small and medium-sized companies: 47% of executives surveyed in the US in 2018 said they were relying on the IoT.
Graphic showing the use of Internet of Things technologies by industry
All percentages reflect the number of respondents in each industry who currently use the Internet of Things.
Despite this high number, we don't know how many of these projects are actually successful. According to Gartner research, companies find it harder to develop use cases for the Internet of Things than for any other technology. This has been the case in recent years and is not expected to change any time soon (the full research is available to Gartner clients):
"Developing IoT strategies will continue to be a challenge for companies: Companies find it harder to find a clear business and technical path for IoT than for any other type of innovation. Many IoT innovations are little more than proof that the technology works, they do not have a clearly articulated value proposition for the company in mind. This leads to false starts, which in turn lead to doubts about the value proposition of the Internet of Things."
Recommended response: Appoint a person as technical lead for the IoT implementation and give them responsibility for the IT architecture.
The Internet of Things can only add value to your SME if the technical requirements are truly understood. This is exactly the job of the technical director - to find out whether implementation is even possible in your company. This task can be carried out by your technical director, the chief developer or someone in a comparable position.
No matter who you hire to do it, it's a step you definitely shouldn't skip, even if it means creating a new full-time position or hiring a consultant. Hiring someone will end up costing you a lot less than a bad IoT implementation.
If it turns out that IoT implementation would be an option for your SME, you should start small and initially choose a pilot project focused on a specific use case.
For example, Gartner found that almost one in six US SMEs uses the Internet of Things for banking and financial services. Insurance providers, for example, can use the IoT to simplify damage assessment, prevent claims from occurring, or offer tailored tariffs.
The challenge: IoT ecosystems are vulnerable to cyberattacks.
Cybercrime costs companies an estimated $600 billion a year worldwide oman telegram data and poorly protected IoT devices are clearly one of the gateways.
They operate over networks and software solutions that increasingly need to withstand attacks. This is partly due to the growing emergence of cybercrime-as-a-service and other criminal industries, but your own colleagues are also a key security risk. Studies show that almost half of cybersecurity incidents are caused by careless staff , and in many companies only a small proportion of employees are truly familiar with IT security policies. There is clearly a lot of catching up to do here.
Although Gartner research found that most SMEs say they use data and information security technologies, 30% of the medium-sized companies surveyed by Forsa have already been the victim of a successful cyber attack and 43% of them have had to temporarily shut down their operations. Studies from the USA even found that 60% of SMEs there go out of business within six months of a cyber attack .
In 2019, Gartner predicts that security concerns will no longer be the biggest obstacle to innovation in the IoT space (full research available to Gartner clients). Instead, it will be security vendors who are not innovating fast enough:
"IoT security concerns have long been the bane of IoT innovators and continue to be the biggest obstacle to IoT innovation, but this is changing. While managing large, heterogeneous, and multi-vendor IoT ecosystems is far from easy, standards and practices are constantly evolving to reduce and address these issues."