April 23, 2013, 1:16 PM — When people talk about the Internet of Things (IoT), the most common examples are smart cars, IP-addressable washing machines and Internet-connected nanny cams.
But IoT is coming to the enterprise as well, and IT execs should already be thinking about the ways that IoT will shake up the corporate network.
[DEFINED: What is the Internet of Things?]
"Products and services which were previously outside their domain will increasingly be under their jurisdiction," says Daniel Castro, senior analyst with the Information Technology and Innovation Foundation, a Washington-based research and educational institute.
So, what are these devices?
Castro says that companies increasingly will be operating in "smart buildings" with advanced HVAC systems that are connected to the rest of the corporate network.
Many utility companies will be deploying Web-connected smart meters at customers' facilities to allow for remote monitoring.
Companies are tying their physical security to their network security, so that data from security cameras and authentication readers are coming under the purview of enterprise IT.
Retailers such as WalMart, Target and Best Buy already use RFID and other tracking technologies to manage supply chain logistics, says IDC's Michael Fauscette. IoT is a natural next step.
Then there's "operational technology," where enterprise assets such as manufacturing equipment, fleet trucks, rail cars, even patient monitoring equipment in hospitals, become networked devices, says Hung LeHong, research vice president at Gartner.
"Those types of assets are becoming Internet enabled," LeHong says. And even though they are managed by field operations or hospital services, he says, they could become end points on the corporate network, just like smartphones and tablets.
Other examples of operational technology might include companies deploying vending machines that are connected to the Internet, so that they can be automatically restocked when certain items run low. "These assets are becoming part of online world, and they could now be on the enterprise network," LeHong says.
Another key area where IoT is making an appearance is what Gartner calls the digital supply chain. That's when a company's end products, such as consumer electronics or large machinery, are Internet enabled so that the manufacturer can keep track of things such as maintenance schedules.
"The digital supply chain continues after you deliver the physical product," LeHong says. A growing number of the more expensive assets and products that are arriving on the market will have this capability, he says.
Another place where IoT is showing up is in consumer offerings such as home automation and the smart grid. IT executives in industries such as gas and electric utilities will need to stay abreast of developments such as how smart meters and other types of data-generating solutions will affect IT and the corporate network.
And finally, IoT is emerging in so-called smart cities, where all kinds of devices and assets such as traffic lights, parking meters and garbage truck fleets are gradually being connected to the Internet. Municipal government IT executives will need to be aware of how these assets tie in to the network.
IT and OT convergence
What will likely happen is a convergence of operational technology and IT. "As these machines go onto the corporate network the CIO or the COO need to start talking together about what the future is going to look like when traditional IT stuff and OT stuff are overlapping on the network," LeHong says.
"Who is responsible for providing security, for example," LeHong says. "There are skill sets that exist in IT that are very developed, but that are new or not a prime focus for the operations guy. There can be some synergies."
IT executives will need to prepare themselves for situations such as when an IP-based vending machine is creating software replenishment orders for out-of-stock items using an enterprise resource planning application, LeHong says.
"When it creates the replenishment order does the vending machine need a user license" for the ERP application, LeHong says. "CIOs need to get an understanding of this. Even if they are not going to own the vending machines, they need to worry about things like that. That's what we mean by convergence. OT and IT can't sit in separate worlds anymore. They need to discuss things like governance, security, software licensing and maintenance."
In terms of networking technology and strategies at enterprises, IoT will have a significant impact. According to a report on IoT trends published by Gartner in 2012, things will be connected, but not necessarily in the ways most familiar to companies today.
"Wi-Fi, 3G/4G cellular and Bluetooth are the wireless connectivity technologies we are most familiar with; however, they will not be the only way things connect to the Internet," the report states.
These network technologies and protocols consume lots of power and are designed for higher-bandwidth applications, the firm says, but many things (for example, a temperature/humidity sensor in a remote agricultural setting) will require low bandwidth, long range and very low power consumption.
In addition, things will need to be addressable. Every computer, smartphone and tablet is addressable on the Internet, directly or indirectly via IP, the Gartner report says, and "it follows that things will also need to be addressable so they can communicate with other things, applications and people on the Internet."
While not every "thing" will have an IP address, it will need to be addressable.
Then there are the data management issues. Getting the most value out of IoT requires an ability to manage data and gain insight from analyzing that data, Gartner says.
If everything has the potential to provide some type of data stream, companies will need technologies to manage, store and analyze the data. While some organizations might be able to leverage existing information management tools, many will need to bring in new technologies designed to handle the real-time and large-scale nature of the IoT.
Recent IT trends such as the move to the cloud and implementations of big data and analytics will likely come into play with the IoT, experts say.
"Are you going to procure cloud services for hooking up these things to the corporate network?" LeHong says. "And it's not just questions about the cloud, but about end-point management and architecture. Let's say you have a jet engine or a pump in an oil field that can produce a terabyte of information per day. That's a lot of data."
From an architectural standpoint, IT and operations will need to decide whether to store that data on site, in the cloud or in a corporate data store.
Looking ahead to the next few years, growth of the IoT will probably be greatest in areas such as inventory tracking and supply chain management, Castro says. But given the way technology is developing, it's likely that the IoT will be pervasive in many aspects of business.
Violino is a freelance writer. He can be reached at email@example.com.
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