As CIO at Boeing, Ted Colbert is no stranger to the Internet of Things. For more than a decade, the aerospace giant has deployed thousands of communications-enabled smart devices to sense, control and exchange data across the factory floor, on the battlefield, and within the company's 787 Dreamliner aircraft.
For National Football League CIO Michelle McKenna-Doyle, however, it's a whole new ballgame. Currently the league is experimenting with instrumentation by deploying sensors on the playing field, the ball, and the players and their helmets; it's even exploring ways to track fans.
The Internet of Things presents two opportunities for IT, says Chris Curran, chief technologist and principal in the advisory practice at PwC. "The first requires the CIO to insert himself into the product design and management process," he says. "The second is a new discussion for the CIO to initiate." One concerns product instrumentation; the other is about "instrumenting" the business itself -- equipping physical locations, vehicles, devices, equipment, people and so on with sensors and beacons to better understand, analyze and make decisions about the way the business processes perform.
To accomplish all of that, McKenna-Doyle says, "a tighter collaboration with customer-facing business partners is a must."
The Internet of Things (IoT) is set to explode, driven largely by the consumer market, where the number of smart "things" and everyday products equipped with IP-addressable sensors -- from wearable smart bands to smart refrigerators -- is multiplying exponentially. Research firm Gartner estimates that 26 billion IoT-ready products will be in service by 2020. That's an average of 3.3 devices for every man, woman and child on the planet. And that doesn't include the projected 7.3 billion smartphones and tablets.
While some of the first smart things were networked sensors used in industrial settings, the definition has broadened. Smart devices increasingly use IP or have access to an IP gateway that can feed data back over the Internet -- and over corporate networks. Michele Pelino, an analyst at Forrester Research, describes IoT devices as "anything that connects objects or assets or individuals [and makes it possible to know their] status in a real-time way."
Gartner analyst Hung LeHong's definition of the IoT includes any connected device or software that can sense and that you can control and use to exchange data. This includes apps that let people send recipes to their ovens, enable BMW owners to unlock their cars if they lose the keys or make it possible for Tesla electric cars to receive automatic over-the-air software upgrades, he says.
As with mobile phones before them, some of these new devices will walk through the office door with employees, while others will be embedded in products that connect to corporate systems from homes and other businesses. And the number of IoT applications spearheaded by lines of business will increase as organizations find new ways to improve productivity, streamline processes and fatten up the bottom line by instrumenting equipment, environments and people and analyzing the data streams generated by those systems.
Even seasoned veterans like Colbert are bracing for an onslaught. What's different now, he says, is the accessibility of many different types of data, the speed at which the data can be gathered, and the tools a business can use to get its arms around that data. "The pace of development of sensors is moving much faster than folks can keep up with," he says. And as the cost of developing and deploying sensors has dropped, businesses can capture more data faster and from more parts of more assets than ever before. "This is about solving hard business problems with better data," Curran says.
It's a sea change, says Vince Campisi, CIO at General Electric's Global Software Center. "Before, even if we had the ability to get the cost of the sensor down, we wouldn't have been able to transport, store and analyze the data." Now, with the evolution of tools for managing and analyzing big data, he says, "we have both."
Jim Noga, CIO at Partners HealthCare, reports that while networked sensors have been used in healthcare for years, of late he has seen a marked increase in both the number of medical appliances instrumented with sensors and the number of network-enabled sensors embedded into individual devices. "We're also seeing more and more of these sensors that live on our operational network," he says.
For IT, the cost of accommodating IoT initiatives is substantial. "These will be multimillion-dollar investments," and they will require significant R&D investments, says McKenna-Doyle. And business units will expect IT to "knit things together," she adds.
Supporting IoT projects will require more than basic computing infrastructure changes, says Colbert. "IT will need to retool its computing services portfolio to allow a richer number of simple applications to expose data from the IoT," he explains.
Here's a look at four steps IT leaders and analysts say IT should be taking as the Internet of Things proliferates.
1. Ramp Up IT/OT Collaboration
Going forward, upfront collaboration with lines of business and associated operational technology (OT) organizations will be essential. As sensor networks move toward more open architectures, the OT organizations that ran the formerly closed, proprietary systems within each line of business will need to work more closely with IT to resolve a host of issues ranging from integration to security. "IT and OT need to work together to decide who manages, controls and monitors what," says LeHong, "and it's no longer clear-cut." That creates a big opportunity for IT.
For example, if a vending machine can tell when an item is out of stock and send an order to the ERP system, does that mean IT needs another user license? And as OT moves to IP-addressable devices, IT must address network management and security issues. IT may also need to handle software maintenance and upgrades -- areas in which OT lacks expertise. All of those issues must be addressed "when things go on the Internet," LeHong says.
The Internet of Things presents two big security challenges, says John Pescatore, director of Emerging Security Trends at the security research, training and certification organization SANS Institute. Many IoT devices will be consumer-driven, and will therefore start out with weak security and little or no manageability. And even with enterprise-driven devices, IT will face a heterogeneous mix of systems. "IT has to learn how to manage devices that aren't all on the same image running the same operating system and the same version of all apps," he says.
CIOs must rethink the network architecture, according to Colbert. "You have to manage the data, manage the networks, and have multiple layers of security in place to allow access to the people and things that need access," he says. "That's hard work in the complex web of networks you have in a large corporation."
IoT at FedEx
Advanced package tracking
One result of the IT/OT synergy at FedEx has been the development of SenseAware, a sensor network that allows the shipping company's customers to track the status of high-value packages in real time. Among other things, they can check the package's location, the temperature and humidity level at that location, whether it's in motion and whether it has been opened. Customers can also configure the system to alert them when certain specifications exceed set thresholds or when the package comes within a specified distance of its destination.
That's a premium subscription service now, but the technology's cost and power requirements will drop to the point where FedEx can offer it for every package, says Kevin Humphries, senior vice president of enterprise infrastructure services. The initiative illustrates the value of using data collected by the sensors in real time, rather than just analyzing it after the fact. "It's not just about big data or access to real-time information. It's what you do with it," he says.
-- Robert L. Mitchell
There are challenges within OT. For example, Campisi says GE's Predix OT management platform works only with GE sensors, such as those embedded in its jet engines. The company has, however, developed partnerships to offer a more holistic look at optimizing airline operations, ranging from setting crew schedules to operating fleets more efficiently, he says.
But a consolidated management platform for the many different IoT devices out there doesn't exist yet, says Colbert. "There's no single pane of glass that can traverse all of the different types of technologies," he says.
That will change, says LeHong, as machine-to-machine cloud platforms such as Axeda, Etherios, MyKoots and ThingWorx emerge to fill the void.
Colbert agrees. "There will also be hubs, routers and gateways that will combine with cloud capabilities to bring together the disparate IoT," he says.
Right now, though, the underlying infrastructure to support it all is inadequate, says McKenna-Doyle. "These days, CIOs have to be the integrators of all of these specialty devices and capabilities," she says.
Fortunately, IT is very good at dealing with these types of issues. At Boeing, Colbert says, the IT organization has "locked arms" with the factory technical teams. But Curran says that level of upfront participation is the exception rather than the norm. "The tendency is for the product people to just build the product and then come to IT," he says.
CIOs can't afford to get involved after the fact, but that's an all too common state of affairs, says Forrester's Pelino. "The back-end stuff? The marketers don't think about that. This is something you have to be proactive about," she says.
And IT's involvement shouldn't stop there. Many projects create data silos, so IT can also add value by integrating data in back-end systems and performing analytics, Pelino says.
Saving time and money with IoT technologies
Users of Hitachi Medical's MRI equipment didn't always notice the light indicating a cooling system failure. In some cases, by the time technicians discovered that a machine was overheating the magnets had melted, resulting in a $75,000 part failure. Rather than wait for an embedded sensor, a Hitachi engineer wired in a Twine sensor and breakout box kit from Supermechanical. In a failure, the Wi-Fi-enabled device sends an alert to Supermechanical's free cloud-based service, which forwards a text message to the field technician. Total cost: $149.
Integrating a Wi-Fi-enabled chip such as Electric Imp or Intel's Edison into every product might cost $20 to $30 per unit -- an expensive investment, says Gartner analyst Hung LeHong. "But for $150 you can build a business case," he says. The Twine kit, with its point-and-click Web service and sensor options, allows rapid experimentation. "It really is easy for even nontechnical people to prototype interactions," says Supermechanical co-founder John Kestner.
Meanwhile, cloud ecosystem providers such as ThingWorx and SmartThings are providing developer environments and APIs for device makers. And the trend is for each machine to include its own APIs, so people can build the mobile apps they need, says LeHong. The question, he says, is this: "Will IT build that -- or not?"
-- Robert L. Mitchell
There's no reason IT can't take the lead in leveraging the Internet of Things for business benefit, says Don Fike, vice president and technical architect at FedEx Corporate Services. "A good place to start is to take a look at your business processes and how they might be impacted by some of the sensor technologies and real-time capabilities," he says. "Step back and say, 'How can this change my business process?'"
LeHong advises CIOs to take the business's top three products and core processes and think about how the IoT might help. "Can you create a better product or service or process?" he asks.
IT executives should also understand how IT can play a critical role in enabling the technology, operationalizing it and securing it. "The more you're aware of the dynamics, the more you can participate in the discussions," says Campisi, adding that when GE talks to businesses about Predix, the CIO is usually involved from the start.
2. Learn to Cope With Consumerization
If industrial sensors weren't enough to think about, IT organizations may be asked to engage with consumer devices they don't control, ranging from smart wristbands that monitor personal health to home thermostats. Some devices might walk in the door with employees or customers, while others might connect in from the home.
Smart things that employees bring to work present a risk-mitigation challenge. "Things will be more advanced in the future. And from a threat perspective, they could be designed to circumvent discovery," says Colbert, adding that that's a big concern for Boeing. IT will also need to develop services and policies for properly classifying data from these emerging smart things, and it will have to establish policy enforcement points to control access and enforce usage rights.