The Main Challenges OEMs Face When Integrating Advanced Technologies into Existing Infrastructures

The integration of advanced technologies into existing infrastructures presents Original Equipment Manufacturers (OEMs) with significant hurdles that can impact their competitiveness, operational efficiency, and market position. As technological innovation accelerates, OEMs across industries face increasing pressure to modernize their operations while maintaining business continuity. This comprehensive analysis explores the multifaceted challenges OEMs encounter during technology integration processes and examines potential strategies for overcoming these obstacles.

Legacy System Compatibility and Integration Complexities

One of the most formidable challenges OEMs face is the integration of modern technologies with outdated legacy systems. These legacy infrastructures, while reliable for basic operations, often lack the necessary architecture to support advanced connectivity features and emerging technologies.

Aging Infrastructure Limitations

Legacy infrastructure in the digital world refers to outdated hardware, software, and systems that struggle to adapt to modern technology and market dynamics, ultimately hindering business growth, innovation, and the ability to meet customer needs3. Manufacturing equipment, for instance, often has a lifespan of up to 20 years, which means many operational machines are not inherently capable of communicating with modern factory units13. This longevity creates a significant hurdle for companies looking to modernize their operations without completely overhauling their existing infrastructure.

Complex Custom Integrations

Without the right platform, custom integrations between legacy systems and new technologies can be expensive, error-prone, and slow to develop1. Legacy applications often have complicated architectures, making integration with modern systems time-intensive and prone to errors12. The integration of new applications with existing legacy systems frequently requires custom development solutions to address compatibility issues, ensuring seamless functionality during the modernization process.

Proprietary Protocols and Standards

Legacy systems often operate on proprietary protocols and lack standardized interfaces, making integration with IoT devices, sensors, and gateways difficult8. This incompatibility between old and new systems creates significant technical challenges for OEMs attempting to implement advanced technologies.

Data Silos and Information Management

A major hurdle for OEMs seeking true enterprise-class solutions is integrating disparate systems and breaking down data silos that impede the flow of information across the organization.

Fragmented Data Landscapes

Critical data often remains trapped within isolated systems like manufacturing equipment, ERP, CRM, and field service applications1. This fragmentation prevents OEMs from achieving a holistic view of their operations and customer experience, hindering their ability to identify root causes of issues, optimize designs, and proactively address service concerns.

Inconsistent Data Formats and Standards

Differing data formats across systems necessitate time-consuming data transformation and normalization efforts1. For OEMs, these inconsistencies create significant challenges when attempting to implement advanced analytics, machine learning, or other data-driven technologies that require clean, consistent information.

Limited Interoperability

Legacy systems and point solutions often lack the necessary interoperability for seamless data exchange and collaboration1. This limited interoperability restricts the potential benefits of advanced technologies and creates information bottlenecks that reduce organizational agility and responsiveness.

Cybersecurity Vulnerabilities and Risk Management

As IIoT adoption grows, so do cybersecurity risks, creating a complex maze for OEMs to navigate when implementing advanced technologies.

Expanded Attack Surface

IIoT systems handling sensitive data become prime targets for cybercriminals, leading to potential financial losses, reputational damage, and regulatory penalties1. The integration of advanced technologies significantly expands the attack surface that OEMs must protect, creating new vulnerabilities and security concerns.

Multi-Tenancy and Compliance Challenges

Ensuring data privacy across all tenants and adhering to evolving regulations like GDPR and CCPA adds layers of complexity and cost for OEMs1. These compliance requirements often necessitate additional security measures and governance frameworks that complicate integration efforts.

Supply Chain Risks

Vulnerabilities can exist anywhere within the IIoT ecosystem, from edge devices to third-party components, increasing the risk exposure for OEMs1. This distributed risk landscape requires comprehensive security strategies that address vulnerabilities across the entire technology stack and supply chain.

Lack of Visibility

Many OEMs lack comprehensive visibility into their security posture, making vulnerability identification and remediation difficult1. This limited visibility becomes increasingly problematic as systems grow more complex through the integration of advanced technologies.

Performance and Scalability Constraints

Legacy systems often face significant performance and scalability challenges when integrated with advanced technologies, creating operational bottlenecks and limiting growth opportunities.

Degraded Performance

Over time, legacy infrastructure slows down, hindering productivity, causing user frustration, and limiting competitiveness due to outdated vendors and technologies3. When advanced technologies are integrated with these systems, performance issues can become even more pronounced, affecting overall operational efficiency.

Scalability Bottlenecks

Legacy systems typically struggle to handle increased traffic, data growth, and new functionalities, leading to bottlenecks and frustrated users12. OEMs face significant challenges in scaling their operations when legacy systems cannot handle the increased demands placed on them by advanced technologies and growing business requirements.

Production Consistency at Scale

High-volume production often results in quality inconsistencies, which can disrupt supply chains and lead to costly delays5. For OEMs, maintaining consistent quality while scaling operations presents a significant challenge, particularly when integrating advanced manufacturing technologies.

Resource and Expertise Constraints

The integration of advanced technologies places significant demands on OEMs’ financial and human resources, creating challenges related to budget allocation and expertise development.

Budget Constraints

Budget constraints are a major obstacle in the modernization of legacy systems12. The financial burden of updating outdated systems to meet current and future business needs can be substantial, forcing OEMs to make difficult decisions about resource allocation and prioritization.

Skill Gaps

The shift to modern technologies often highlights a shortage of skilled professionals proficient in new software languages and systems12. Organizations may struggle to find developers who are skilled in both legacy and modern technologies, leading to delays in modernization efforts and integration projects.

Technical Debt

Technical debt stems from outdated programming practices and inefficient systems, making changes slow, expensive, and prone to errors12. For OEMs, accumulated technical debt due to delayed upgrades and patches complicates modernization efforts, leaving organizations with obsolete and vulnerable infrastructure that is difficult to integrate with advanced technologies.

Time-to-Market and Competitive Pressures

OEMs face significant pressure to accelerate their development and deployment timelines while still delivering high-quality, innovative products.

Extended Development Times

Developing custom solutions, such as over-the-air (OTA) software and data management systems, requires significant time, resources, and effort6. This approach demands an entire team dedicated to research, design, implementation, and pre-market testing to ensure compliance with safety and security protocols.

Build vs. Buy Decisions

To address the challenge of extended development times, OEMs must decide whether to build advanced functionalities in-house or invest in readily available technologies6. Each approach has implications for time-to-market, customization capabilities, and resource allocation.

Competitive Market Dynamics

Modernization has become more than just a buzzword in manufacturing; it’s a survival tool for established OEMs in the era of born-in-the-cloud competition7. As competitors embrace advanced technologies, OEMs face increasing pressure to accelerate their own modernization efforts to maintain market position and competitive advantage.

Conclusion: Strategies for Successful Technology Integration

Despite the numerous challenges, OEMs can implement effective strategies to successfully integrate advanced technologies into their existing infrastructures. By adopting a strategic approach that balances innovation with pragmatism, OEMs can overcome integration obstacles while maximizing the benefits of technological advancement.

Strategic Partnerships

Partnering with global leaders in product and customer lifecycle services enables OEMs to focus their internal resources on innovation while leveraging external expertise for necessary operational practices7. These partnerships can provide access to specialized knowledge and capabilities that facilitate smoother technology integration.

Digital Retrofitting

Digital retrofitting offers a solution for OEMs looking to modernize their operations without completely replacing existing equipment13. Unlike traditional retrofitting, which focuses on upgrading mechanical parts, digital retrofitting involves upgrading legacy machines with sensors and Internet of Things (IoT) components to enhance connectivity and data collection capabilities.

Platform-Based Integration Approaches

The Flex Platform and similar solutions provide robust integration capabilities and pre-built connectors to seamlessly bridge data silos1. By leveraging these platforms, OEMs can securely connect disparate systems, normalize data from various sources, and break down information barriers that impede advanced technology integration.

By understanding and addressing these challenges strategically, OEMs can successfully navigate the complexities of integrating advanced technologies into their existing infrastructures, ultimately achieving enhanced operational efficiency, improved customer experiences, and sustained competitive advantage in rapidly evolving markets.