The Internet of Things (IoT) has changed from an idealistic ‘maybe’ to a snowballing reality. Supply chains stand to be, and are being, radically changed as a result. However, the IoT isn’t arriving in a one large hit, it’s happening gradually. At the moment businesses and individuals are in an experimental phase about how to use the IoT to their advantage – everyone is still learning, and technology is still advancing. However, we are at the point where we’ve seen enough to be able to start predicting what the Internet of Things will mean for the future in supply chains.
What is the Internet of Things for the Supply Chain?
Many people will still be thinking of the IoT in terms of electronic wearables, or possibly consumer lifestyle products: the way of making every aspect of our lives ‘smart’. For the supply chain it is more than this – it’s about bringing smart technology to every facet of the supply chain processes – from production to logistics. This bringing together of information benefits the business as a whole. Unlike creating the ‘smart individual’ or ‘smart home’, it’s about something so much greater – the ‘smart supply chain’.
Utilising various IoT sensors and devices, you gain greater applicable intelligence. For the supply chain this equates to more effective utilisation of supply chain data and the intelligence gathered. This can change and impact every element of the chain from automation in manufacturing, to smart warehousing, to streamlined efficient logistics.
There are a variety of key areas within the supply chain which will be profoundly altered by the IoT. Understanding these areas and how the IoT will change things is essential to future-proofing your business.
Machine and Asset Performance
There are a plethora of different variables that affect the success, efficiency, and bottom line of supply chains. Central to supply chains with manufacturing is the performance of their key machinery, and maintenance of that. Machine performance can make or break a supply chain.
If you add in the IoT to mechanisation, you can add sensors and connect the machine to the wider organisation giving real-time visibility on what’s happening, why breakdowns happen, or if maintenance is needed. The result is ‘smart maintenance’ – predicting maintenance and scheduling it for when the downtime will have least impact on output. By utilising the IoT you ensure maximised workflow and efficient operations.
The IoT brings visibility to the internal workings of the machines in a powerful way. Now you can see which pieces of equipment are likely to break down, and even go as far as utilising and analysing the data with variables such as labour and material consumption. You suddenly gain much more insight in to your machines and their performance.
In this way, the IoT transforms traditional asset management and stands to make things more efficient and reliable.
This isn’t the end of the road for the IoT and asset performance management though. It’s not just about preventing breakdowns, but about actively boosting and ensuring performance levels. Imagine the power you’d have as a supplier if you could guarantee production times. If you could reliably build your business strategy on cast-iron guarantees you would have an immense competitive edge. Service can become the central pillar of what you do.
The IoT, with smart sensors on machinery and equipment, can give you not only insight but control over the different elements that come into play in your production processes. Decision-making is more effective due to real-time data, and it’s easier to head down the right road for maximum profitability.
The Internet of Things and Apps for Industry
Combining the IoT with workable customised apps is the next big thing. It is apps that stand to make the IoT actually usable and comprehensible to individual businesses and their managers. They can be refined, and allow the business to use the IoT in the most effective and customised way. It enables supply chain managers to utilise the IoT beyond the scope of their original purpose.
Thus far we can see how some cloud-based platforms combined with the IoT are working in reality, for example through warehouse inventory control. In time these will bring greater visibility and centralisation to the process. For supply chain managers, having worthwhile and accurate feedback, that can be utilised going forward to continually refine the processes, is the key to success. The IoT makes this possible.
The Internet of Things and Logistics
We are already seeing immense shifts in logistics thanks to the IoT. An area rife with potential problems and inefficiencies, due to its wealth of ‘moving parts’, the IoT is bringing visibility and control. The IoT can allow the logistics element of the chain to become so much more agile and responsive.
Central to this is one of the main ways we are already beginning to see the IoT in action. GPS and RFID are becoming much more than straightforward routing and tracking tools. Additionally, supply chain managers can access the data gathered by logistics and provide visibility throughout the chain. For example, on a micro level, the IoT can allow temperature control to be managed on the road for temperature sensitive goods allowing for other variables such as weather, or delays, or more.
The IoT in logistics is about optimising the transport fleet much further than ever before in terms of fuel, vehicle downtime, labour management and more.
The Internet of Things and the Supply Chain
Overall, utilising real-time data collected from various sensors will provide a very high level of intelligence, visibility, and analytics. As the IoT gains momentum we can expect significant boosts in the productivity and responsiveness of supply chains.