Organisations struggle to implement early IoT solutions

Long-term prospects for IIoT however remain ambitious, Bain & Company says in a new report

Majority of today’s users are still trying to figure out how to fully maximize the use of current solutions, said Dr Jemili.
Majority of today’s users are still trying to figure out how to fully maximize the use of current solutions, said Dr Jemili.

Customers’ expectations for implementation of IoT have cooled over the last two years as industrial companies have find integrating IoT use cases into their existing operational technology and IT systems more challenging than expected.  

That said, long-term prospects for Industrial Internet of Things (IIoT) remain ambitious, says a new report from Bain & Company.

Dr. Houssem Jemili, partner in digital practice at Bain & Company Middle East, shared, “The future looks bright in terms of prospects and opportunities surrounding industrial IoT in the Middle East—however, the strong outlook seems to remain untapped as majority of today’s users are still trying to figure out how to fully maximize the use of current solutions.”

The report, Beyond Proofs of Concept: Scaling the Industrial IoT, reveal that in 2016, 60% of respondents expected to be at the implementation stage by 2020. In the 2018 survey, expectations for IoT implementation dampened slightly, hovering closer to 50%, and survey respondents now believe it will take longer to reach scale than they originally anticipated.

“While short-term challenges abound in the industrial Internet of Things, we believe long-term progress remains on track,” said Michael Schallehn, a partner in Bain & Company’s Technology practice.  “Given the progress in sensor technology, 5G connectivity, edge computing and edge analytics, and an estimated 20 billion devices that need to be connected by 2020, there’s little doubt of the potential for IoT and analytics technologies to deliver vast improvements in efficiency.”

But first, industrial customers need to overcome several barriers to adoption.

According to Bain & Company’s 2016 survey, customers were most concerned about security, returns on investment, and the difficulty of integrating IoT solutions with existing IT and operational technology. In 2018, security and integration were still top concerns, indicating that tech vendors have not made much progress in addressing these. Additionally, recent research found that as an organisation becomes more technologically mature, concerns about security actually increase – so the challenge continues to grow.

In the 2018 survey, the issues that weighed heavily on industrial customers were those that arose during implementation – in particular, technical expertise, difficulties in porting data across different formats, and the transition risks.


Recent Bain research indicates that the industrial portion of the Internet of Things, including software, hardware and system solutions in the manufacturing, infrastructure, building and utilities sectors, continues to grow rapidly, and could double in size to more than $200 billion by 2021.

Capturing that opportunity requires device makers and other vendors of industrial and operational technology to dramatically improve their software capabilities – not a historical strength for most of them.

Additionally, to achieve scale, operational technology vendors and manufacturers will need to mobilize over the next year, to ensure they gain the necessary capabilities and position themselves for long-term success, the study concludes.

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