Enterprise IoT: What’s the State of Play?

The scope of the Internet of Things seems nearly endless, with devices ranging from industrial components to consumer-facing devices selling well

The enterprise, however, is shaping up to be one of fiercest arenas, and IoT adoption, which has been somewhat slow, is expected to rise significantly in the coming years.

The benefits of IoT devices for consumers is clear, as it’s easy to decide if the benefits of a particular device are worth the cost. Industrial entities have embraced the IoT as well, as the field already relies on sensors and it’s easy to predict the benefits of IoT investments. For enterprises, on the other hand, it’s not as easy to tell whether investing heavily in IoT devices will pay off in the future. This has led to sluggish adoption, as executives have been reluctant to invest heavily without strong evidence that the IoT will improve the bottom line.

Small Steps

Despite somewhat sluggish adoption, there are scenarios where IoT solutions are the clear choice for enterprises, and companies are investing. HVAC systems, for example, are far more efficient when fed IoT data, leading to lower energy costs with a relatively modest investment. Inventory tracking is seeing adoption as well; low-cost RFID tags, in particular, make it far easier to keep track of products both in warehouses and in stores. Fleet management is a natural field for IoT investment, and it’s common for companies of all sizes to invest in IoT technology for handling vehicle maintenance and tracking.

Although the IoT will have a significant impact on how typical businesses operate in the future, devices will have to carve out a role in offices that are already highly connected. A 2017 study by McKinsey found 98% respondents stating that IoT initiatives were already in their strategic roadmaps – particularly in service-related operations.


There’s no sharp line between IoT devices and “smart” devices, and laptops and smartphones can already accomplish much of what IoT devices can do. One of the driving forces behind IoT adoption is the low cost of devices, but enterprise-class companies already allocate a significant amount of money to giving employees digital devices. In order to make progress, IoT products will need to show a demonstrable benefit that can’t be attained on a smartphone or laptop.

IoT vendors are expecting a strong future for IoT in the enterprise, and there will be fierce competition. Established entities in the enterprise could have an advantage over the competition; many companies have relied on IBM for decades, so they might be interested in IBM’s Watson IoT Platform. Companies already invested in Microsoft technology might enjoy the relative ease of adopting the Azure IoT Suite. Amazon’s ascendant AWS platform has IoT capabilities as well, making it a potentially popular option. However, innovation often occurs first at smaller entities, so there’s a chance a smaller company may become a dominant player for enterprise IoT solutions.

An Iterative Approach

The IoT works in conjunction with other emerging technologies. For many sectors, IoT capabilities are central: Industrial entities, for example, often invest in the IoT because of the improved efficiency it promises. However, enterprise companies have invested more in the cloud and smart technology, and they may be more likely to take a piecemeal approach to IoT adoption by picking up small features tied closely to their cloud platforms of choice. Digital transformation is occurring in the enterprise at a rapid pace, and the IoT is just one part of this process. There may not be an inflection point for enterprise IoT adoption, as the process may be slow yet steady.

Enterprise-class companies are known for being slow to adapt new technology. On the other hand, growing or digital native companies are often more flexible, and many may find use cases that provide an advantage over their more established competitors. Smaller companies able to leverage the power of the IoT may end up forging new paths that become popular among enterprise companies, accelerating the pace of change. All disruptive technologies are difficult to predict, and the IoT is no exception. Even if current outlooks project modest but steady increases in IoT adoption in the enterprise, growth could explode if the value of IoT in the enterprise becomes more clearly established.

The Internet of Things is coming to the enterprise, but it might not resemble the army of small sensors that typify the IoT in other settings. The move might be subtle; whether is device is part of the IoT or merely a smart device is a judgment call without a clear answer. However, those working at enterprise companies, especially those making technical decisions, should prepare for the opportunities and challenges the IoT brings.