Business Systems Integration: IoT System Integration for the Internet of Things

Updated April 11, 2024

Key Takeaways

• The Internet of Things (IoT) continues to grow as economies of scale make devices cheaper and 5G becomes more ubiquitous.
• New devices connected by the IoT now outnumber new devices not connected.
• Worldwide spending for IoT system integration has grown to $1 trillion per year.
• After smartphones and computers, video entertainment devices—namely televisions and other streaming devices—make up the largest percentage of IoT devices, followed by smart speakers. Security, thermostats, and lighting make up the next three most common devices that are connected by IoT systems integrators.
• Security for IoT projects is constantly evolving. When it comes to business systems integration, technicians are primarily concerned about internet-connected devices that could impact critical operations.
• Consumers are more concerned with protecting sensitive IoT data collected by each device, so including IoT system integrators—professionals who work on IoT platforms—is a must for any IoT project.

2024 UPDATE: IoT and Business System Integration

As our previous article—and just about anyone paying attention—predicted, the Internet of Things continues to grow at an amazing rate. More than 12 billion devices are now connected to the internet as business systems integration grows and consumers realize the advantages and convenience that having connected devices provides. IoT solutions are all the rage.

The creation of IoT devices isn't slowing down, either. There are more IoT devices than there are people in the world. That number is expected to grow to over 25 billion in the next seven years. What used to be a novelty is now becoming the norm, as the percentage of new connected devices is greater than new devices that aren't connected. The number of platforms providing system integration for these devices is also increasing, as there are now multiple systems that allow data integration with the IoT...more than 400 IoT platforms to choose from, in fact.

Economies of scale, expanding high-speed internet, and growing 5G coverage all converge to make an increasing number of everyday items IoT-compatible. While IoT systems integration helps business owners improve the efficiency of buildings and inventory, there's no denying that consumers are still enamored with the ability to connect their smartphones to the coffee maker!

Secure Data Integration with Electronic Data Interchange

Security has always been a concern for any business utilizing IoT system integration services for business. As IoT system integration continues to expand, so does the amount of information it collects, making it more attractive to hackers.

Additional features can also open up additional security concerns on IoT platforms, giving bad actors more vectors of attack. Those in charge of business systems integration with IoT devices must be vigilant about security updates, stay alert, and provide secure electronic data interchange (EDI).

How IoT System Integration Is Changing for Consumers

The IoT revolution is increasingly making its way into the everyday lives of most people. When we originally wrote this article in 2016, the most commonly connected devices found in homes tended to be a smart thermostat or Amazon's press-to-order Dash button. While smart thermostats remain in people's homes, the Dash buttons were discontinued approximately five years ago as listening devices like Amazon Alexa became popular. (Voice-activated hardware seems to be in trouble, though, so check back in the future for updates about the IoT integration market.)

While the novelty of smart devices is still in full swing—people love to be able to access their thermostat from the airport if they forget to turn it down before a long trip—consumers are also becoming more aware of privacy concerns with IoT-enabled devices.

The more powerful and versatile devices become, the more information is being gathered. While it's likely the consumer has agreed to let the manufacturer gather information about the usage of the product, no one wants that information stolen and used for nefarious purposes after IoT system integration has occurred.

You don't want to make enemies of your customers, so make sure you find the best IoT system integrators possible.

How the IoT Is Revolutionizing Business and eCommerce

It's likely that you're already using some device in your home that would be considered part of an IoT system. Whether you have a smart thermostat, control your coffee maker with an app, shop with Alexa, or check to see who's at your front door with a smart doorbell, you're part of the growing number of people who have embraced the idea of connected devices and IoT integration.

The implications are perhaps even more staggering for the B2B market than the B2C market, with equipment being replaced or repaired before a problem arises. IoT system integration delivers advantages that could never be realized before IoT deployment.

IoT: An Overview

Believe it or not, the idea of IoT system integration is not a new one. In their article in Foreign Affairs magazine, MIT Professor Neil Gershenfeld and Cisco IoT Architect JP Vasseur describe how work on extending the Internet into Things began as early as 1995. However, implementation was limited by a relatively small, finite number of IP addresses and the cost of IoT integration being prohibitive.

Today, these limitations no longer apply. IPv6, easier data integration, business system integration, and work on the extension of protocols allow for a virtually limitless number of internet addresses for literally every device we could ever want to connect with an IoT platform. Microcontrollers measure just millimeters across, cost just pennies to manufacture, and use just milliwatts of electricity so that they can run for years on a battery or small solar cell.

Greater System Integration with Existing Systems

Most businesses plan to expand their reliance on IoT system integration in the near future. If Google's acquisition of the smart thermostat Nest is any indication, the reach of the IoT solutions is about to explode. This chart shows the expected business benefits of IoT implementation. Challenges include securing the web of interconnected systems and the ability of IT systems to adapt to change quickly.

McKinsey and Company breaks down IoT applications into two categories: information and analysis; automation and control. Within information and analysis, you have behavior tracking, situational awareness, data processing, and sensor-driven decision analytics that are interpreted by IoT platforms. Within automation and control, you have process optimization, resource consumption optimization, and autonomous systems.

However, both BI and McKinsey and Company fail to emphasize a tectonic shift in the way companies will do business and the way that business system integration connects nearly everything from multiple systems.

How the IoT Will Streamline Predictive Analytics

As a result of thousands of devices streaming information through networks, businesses will acquire a mind-boggling amount of data analytics regarding how customers use their products. Such data integration will allow these companies to garner invaluable business intelligence, enabling them to improve products, services, and marketing messages after IoT deployment is successful.

All of this is amazing and exciting, yet it pales in comparison to the most important factor. The revolution lies in the advent of predicting consumer demand and the corresponding ability to meet needs almost instantaneously. In the age of the internet—where everyone is used to getting what they want in seconds—such advances are irresistibly tantalizing. Bringing all of this together with IoT projects can launch you ahead of the competition.

System Integration at Amazon

Amazon is constantly updating predictive shipping and home delivery of fresh groceries via Amazon Fresh. Individual customers get their groceries exactly when they need them, and Amazon uses this data to streamline its business processes by predicting demand and adjusting strategies accordingly.

This ability to predict and instantaneously meet consumer needs results in a more pleasurable business experience for the consumer and makes them more likely to continue doing business with that company. This IoT system integration method is where companies can capitalize on better products and services to increase customer retention strategies that extend the customer life cycle.

Customer Retention through Automated Service

Convenience in the age of the internet cannot be overstated.  Automation brought about by IoT integration helps customers get what they want or need before they even realize they want or need it.

Make It Automatic

Take the air filter in my house, for example. Do I remember to check it monthly? No. Do I take my time bothering to replace it on the off chance I do realize it needs replacing? Yes. Am I highly likely to sign up for a service that automatically sends me replacement filters when needed? Yes. The same can be true of light bulbs, fish tank filters, dog food, groceries, game controllers, pool filters, and more.

If the customer has the option to search for a product they need only once, and then they never have to worry about that process again, don't you think they'd agree to a service that does just that?

Convenience is Key

As convenience, service, and product satisfaction increase, so does the likelihood of this kind of arrangement becoming more and more common. The key to this kind of retention lies within system integrations in eCommerce.

ECommerce, IoT, and Line of Business Application Integration

ECommerce is only going to grow bigger as more devices capable of making purchases are connected to the internet. If you don't have an eCommerce website and it's not mobile-friendly, stop reading this and get on top of that before your business keels over and dies like Blockbuster.

Keep Customers Informed

When a customer checks out of an eCommerce web store, their credit card and shipping information must be acquired to ensure payment and delivery. However, eCommerce allows the easy collection of extra data like email addresses, phone numbers, social profiles, and more. This system integration—often via an enterprise service bus (ESB)—helps companies avoid any misunderstanding by sending an email reminding the customer that you are replacing their coffee and eggs and that their card will be charged X amount of money. 

Line of Business Applications

However, system integration of this data with line-of-business (LOB) applications like CRM and ERP systems, among others, is absolutely essential. Pulling this information into individual CRM profiles, as well as information from the connected device they have bought, allows you to monitor their individual customer profile for replacement, repair, usage, and more.

As mentioned before, all these individual profiles aggregated can give you correlative insight into usage and the product itself. Without LOB business systems integration, not only is none of this possible, but your competition will swallow you alive. IoT, eCommerce, and LOB application data need the best systems integration to create one intuitive platform to take full advantage of this exciting new technology.

Challenges Moving Forward

Two obvious challenges are security and integration. Secure smart device networks with private data and sensitive information need safeguards that mitigate the possibility of theft or malicious attacks. Thankfully, cryptography is a blossoming field that will help stem a wave of security and privacy concerns. Layered security protocols and consumer education (<cough> people using simple passwords <cough>) can also help with the safe systems IoT system integration services.

System integration is challenging for most businesses. Companies worry about total cost over time, the ability to scale and adapt, the IT resources needed to maintain the system, time to deploy, and security. Additionally, IoT integration with eCommerce and LOB systems will require custom integration. In the end, it all comes down to the company chosen to build the custom integration.

We've created this comprehensive guide to integration projects that can help navigate you through a complicated process. Get in touch with Clarity to learn more about how you can make the most of our IoT solutions.