The growing popularity of the Internet of Things (IoT) systems such as the smart grid, Body Area Networks (BANs), and the Intelligent Transportation System (ITS) is driving Wireless Sensor Network (WSN) systems to the limit in terms of abilities and performance. WSNs were initially designed for low power, low data rate, and latency-tolerant applications. However, this paradigm is changing because of the nature of the new applications. Therefore, instead of only focusing on power-efficient WSN design, researchers and industries are now developing Quality of Service (QoS) protocols for WSNs. In addition to that, latency-and reliability-critical protocol designs are also becoming significantly important in WSNs. In this paper, we present an overview of some important smart grid latency-critical applications and highlight WSNs implementation challenges for these smart grid applications. Furthermore, we develop and evaluate two novel optimization models that solve for the optimum values of the end-to-end latency and power consumption in a clustered WSN given lower bounds on reliability and other network parameters.