IDC predicts that the worldwide installed base of Internet of Things (IoT) endpoints will grow from 14.9 billion at the end of 2016 to more than 82 billion in 2025. At this rate, the Internet of Things may soon be as indispensable as the Internet itself. Despite the forward momentum, a new study conducted by Cisco shows that 60 percent of IoT initiatives stall at the Proof of Concept (PoC) stage and only 26 percent of companies have had an IoT initiative that they considered a complete success. Even worse: a third of all completed projects were not considered a success. “It’s not for lack of trying,” said Rowan Trollope, Senior Vice President and General Manager, IoT and Applications, Cisco. “But there are plenty of things we can do to get more projects out of pilot and to complete success, and that’s what we’re here in London to do.”
Cisco released the findings at IoT World Forum (IoTWF), an event where Cisco convenes the industry’s best, brightest and most passionate leaders with the goal of accelerating IoT. We surveyed 1,845 IT and business decision-makers in the United States, UK, and India across a range of industries — manufacturing, local government, retail/hospitality/sports, energy (utilities/oil & gas/mining), transportation, and health care. All respondents worked for organizations that are implementing and/or have completed IoT initiatives. All were involved in the overall strategy or direction of at least one of their organization’s IoT initiatives. The goal was to gain insight into both the successes as well as the challenges that are impacting progress.
1. – The “human factor” matters. IoT may sound like it is all about technology, but human factors like culture, organization, and leadership are critical. In fact, three of the four top factors behind successful IoT projects had to do with people and relationships:
– Collaboration between IT and the business side was the #1 factor, cited by 54 percent.
– A technology-focused culture, stemming from top-down leadership and executive sponsorship, was called key by 49 percent.
– IoT expertise, whether internal or through external partnership, was selected by 48 percent.
In addition, organizations with the most successful IoT initiatives leveraged ecosystem partnerships most widely. They used partners at every phase, from strategic planning to data analytics after rollout.
Despite the strong agreement on the importance of collaboration among IT and business decision-makers, some interesting differences emerged:
IT decision-makers place more importance on technologies, organizational culture, expertise, and vendors.
Business decision-makers place greatest emphasis on strategy, business cases, processes, and milestones.
IT decision-makers are more likely to think of IoT initiatives as successful. While 35 percent of IT decision-makers called their IoT initiatives a complete success, only 15 percent of business decision-makers did.
2. Don’t Go It Alone. Sixty percent of respondents stressed that IoT initiatives often look good on paper but prove much more difficult than anyone expected. Top five challenges across all stages of implementation: time to completion, limited internal expertise, quality of data, integration across teams, and budget overruns. Our study found that the most successful organizations engage the IoT partner ecosystem at every stage, implying that strong partnerships throughout the process can smooth out the learning curve.
“We are seeing new IoT innovations almost every day,” said Inbar Lasser-Raab, VP of Cisco Enterprise Solutions Marketing. “We are connecting things that we never thought would be connected, creating incredible new value to industries. But where we see most of the opportunity, is where we partner with other vendors and create solutions that are not only connected but also share data. That shared data is the basis of a network of industries – sharing of insights to make tremendous gains for business and society, because no one company can solve this alone.”
3. Reap the Benefits. When critical success factors come together, organizations are in position to reap a windfall in smart-data insights.
Seventy-three percent of all participants are using data from IoT completed projects to improve their business. Globally the top 3 benefits of IoT include improved customer satisfaction (70%), operational efficiencies (67%) and improved product / service quality (66%). In addition, improved profitability was the top unexpected benefit (39%)
4. Learn from the failures. Taking on these IoT projects has led to another unexpected benefit: 64 percent agreed that learnings from stalled or failed IoT initiatives have helped accelerate their organization’s investment in IoT.
Despite the challenges, many in our survey are optimistic for the future of IoT — a trend that, for all its forward momentum, is still in its nascent stages of evolution. Sixty-one percent believe that we have barely begun to scratch the surface of what IoT technologies can do for their businesses.
By 2020, Cisco expects up to 50 billion connected devices to be in play, signaling a critical mass in achieving the promise of the Internet of Things (IoT). Cisco wants takes a leading role in securing that promise with the introduction of a product called IoT Threat Defense. This broad architectural and services solution segments devices on the network to provide adaptable, extensible protection for organizations at IoT scale. The first use of IoT Threat Defense is to secure vital services in advanced medical care, power generation and delivery, and automated manufacturing.
Escalation of Cyberattacks Can Cripple Vital Services
The escalation of ransomware and other malware events in the past year reveals that organizations are even more critically exposed, reflecting a long-held concern that “it’s not if but when” a business may fall victim to costly cyberattacks. The Cisco 2017 Annual Cybersecurity Report notes that CISOs find attacks can impact operations, reputation, and revenue. At stake is unauthorized access to networks, data and IP loss, and business shutdown.
These issues are compounded for those in manufacturing, with IT and OT challenges in how businesses securely connect devices, protect plant operations, and maintain functionality and uptime. While many device manufacturers are building in cybersecurity, implementation can take years. The logical move is to segment these devices to put them out of attackers’ reach. If devices are compromised, organizations can prevent them from being used as pivot points to move through the network, and to activate incident response processes to protect the business.
Segmentation Clears Obstacles to Securing the IoT
Organizations face two major hurdles in securing the IoT. First, most IoT devices can’t protect themselves. The resulting vulnerabilities create ample opportunities for attackers to exploit those devices and gain network access. The second complicating factor is scale, as businesses will be expected to connect billions of devices in the next few years.
Network segmentation is not new. Virtual Local Area Networks (VLANs) have been in use for decades. But the sheer scale of the IoT makes creating enough VLANs impractical, if not impossible.
Cisco has led the market in designing, deploying, and securing networks for over 25 years. It continues to build the equipment, invent the technologies, and develop the standards that help make the Internet possible. Cisco invented TrustSec, an extensible, automated, policy-based technology to solve problems of secure segmentation at scale for the IoT. It is supported across a range of Cisco equipment – ruggedized or non-ruggedized, from the data center to the factory floor.