What Does IoT Mean for the Supply Chain?
The general definition for “The Internet of Things” (IoT) is the concept of connecting any device with an on and off switch to the Internet (and/or to other devices). This includes everything from cellphones, coffee makers, washing machines, headphones, lamps, wearable devices and almost anything else you can think of. Within the supply chain space, what does this mean? The IoT emergence will allow supply chains to intelligently connecting people, processes, data, and so forth via devices and sensors. This will allow things to come to life in numerous ways with regards to intelligence and data. Let’s look at a few ways the IoT adds to the depth of a supply chain.
- Inventory and Warehouse Management – Active and passive RFID tags can provide information on the items that they are attached to. The difference between the two is that passive tags have an RFID antenna and a microchip for storing information, while active tags have their own battery power and can sometimes include additional sensors. Research shows that by the year 2020, seven out of ten supply chain managers will use IoT technology on a daily basis to maximize production at their “smart” warehouses.
- In-transit visibility – Cloud based GPS and RFID technologies (mentioned above) are the key to an effective in-transit monitoring This will allow for an accurate prediction of shipping arrival/delivery time and consistent observation of crucial quality control elements. As seen during this intense hurricane season, the IoT was able to reroute trucks and make changes to automated delivery systems. Maersk, a major shipping company uses in-transit visibility technology to monitor refrigerated containers’ important statistics like temperature, location and power supply.
- Data, data and more data – Data collected from IoT devices can show real-time results in terms of how a specific product is selling on the shelves. This helps companies segment customers better and work within their supply chain to increase or decrease delivery to a certain location. A recent survey of companies revealed that 73% of businesses are using IoT data to improve their business. Additionally, data such as fuel consumption, vehicle utilization, speed tracking and mileage logged can be invaluable in forecasting costs and making quick decisions in terms of labor and fleet management.