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The Internet of Things (IoT) has significant potential in upgrading legacy production
machinery with monitoring capabilities to unlock new capabilities and bring economic benefits.
However, the introduction of IoT at the shop floor layer exposes it to additional security risks with
potentially significant adverse operational impact. This article addresses such fundamental new
risks at their root by introducing a novel endpoint security-by-design approach. The approach is
implemented on a widely applicable production-machinery-monitoring application by introducing
real-time adaptation features for IoT device security through subsystem isolation and a dedicated
lightweight authentication protocol. This paper establishes a novel viewpoint for the understanding
of IoT endpoint security risks and relevant mitigation strategies and opens a new space of risk-averse
designs that enable IoT benefits, while shielding operational integrity in industrial environments
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