5 Keys Ways IoT Solutions are Streamlining Modern Supply Chains
This is a guest article by logistics content writer Kristie Wright
In 2016, Gartner predicted that by 2020, more than half of new businesses would incorporate one or more elements of IoT technology into their operations. It was also predicted that a thirty-fold increase in internet-connected devices would significantly impact supply chain operations.
Now, as these predictions come to fruition and commerce is becoming increasingly more intelligent, it’s easier to see how the Internet of Things is improving logistics and streamlining supply chains.
Supply chain management is a nuanced and multi-faceted field, and as a business scales, it can become highly complex. Dozens of operations and tasks can unfold at the same time during a single delivery. It’s up to supply chain managers to effectively streamline them.
IoT-based technology can help build clear visibility and large-picture supply chain views. This aids the development of functional and sustainable frameworks for the management of any supply chain.
In this article, we’ll explain how the Internet of Things works and outline five of the key ways that IoT solutions are being used to leverage supply chains.
What is the Internet of Things?
The Internet of Things, or IoT for short, is a term that refers to the concept of connecting a wide range of devices to the internet—and to each other. Essentially, the IoT is a massive global network of connected devices, appliances, machines, and the people using them. All the IoT-connected devices collect and share data about their usage and the environments they operate in.
The skeleton of an IoT system
The development of specialized devices and appliances that contain built-in IoT sensors makes this concept a reality. The sensors connect to a central Internet of Things platform. This platform collects and integrates data from different devices. It then uses analytical algorithms to identify and share the most valuable data with apps designed to address specific user needs.
In the world of supply chain management, IoT devices can provide advanced analytics to make business and production processes more efficient. Smart objects and connected systems allow for the automation of tasks that would otherwise use up hundreds of manpower hours and other important business resources.
1. Real-Time Tracking
The Internet of Things and IoT-enabled technology provide businesses and their supply chain managers with a legible stream of real-time data on their product shipments.
This data pertains to the location of the products, the transportation environment they’re subjected to in transit, and every step of the process in between.
Real-time tracking modules will immediately alert supply chain managers if a product shipment gets directed to the incorrect location, or lost during transit. These modules allow managers to monitor the delivery of ready products and raw materials. This ensures streamlined and efficient supply chain operation from start to finish.
2. Monitoring Shipments and Deliveries
A business’s logistical processes are often fraught with challenges if handled in traditional ways. IoT sensors can simplify shipping and delivering goods. These sensors are placed with product shipments to allow businesses to track the shipments’ locations, conditions, and even how they are being handled while in transit.
This information gives companies accurate estimates of when shipments will arrive. And they help to prevent problems associated with damaged or missing shipments.
Many modern IoT-based shipping and delivery solutions collect and analyze data from multiple sources. This allows them to offer end-to-end visibility at every stage of the supply chain. The information provided by IoT devices, port authorities, airlines, carriers, weather experts, news feeds and satellites can give businesses a clear picture of any stage of their supply chains. Access to this data enables them to predict shipment ETAs, as mentioned above, and to improve their abilities to plan and execute complete, intact, and timely deliveries.
3. Improving Inventory Control
The IoT has revolutionized the way businesses of all sizes conduct their inventory management processes. Advanced technology has made it possible to track goods at every touchpoint of the supply chain to ensure streamlined and highly efficient operations.
Companies can now position IoT-connected sensors with a variety of different components to assist in their inventory management. IoT inventory systems allow businesses to monitor all the most critical elements of supply levels in real time. This enables them to make smarter purchasing decisions and avoid shortages.
Analyzing the data from IoT systems can help to predict a business’s future inventory needs. In doing so, they can plan ahead in a way that meets customer demand and minimizes delays.
Over and above providing data insights and inventory management value, IoT systems can automate these tasks and free up human employees’ time. This can save a business significant amounts of money and manpower hours, which would otherwise have been spent manually tracking and handling inventory. IoT-based solutions allow human staff to focus on the most essential business operational tasks without the distraction of tasks that are easy to automate and readily handled by computers.
These solutions facilitate seamless, automated asset information updates. Instead of managers having to log data into spreadsheets manually, they can use IoT software to automatically update the statuses of business assets regularly.
The Internet of Things enhances asset tracking by attaching barcodes or RFID tags to consumer goods. This grants supply chain managers access to important insights on each delivery, including the contents of a package, storage manuals and more.
4. Monitoring Storage Control
Most IoT-capable sensors come equipped with sensitive environmental sensors. These specialized sensors allow supply chain managers to track the storage conditions of goods during the shipment process. The technology can measure the temperature inside a storage warehouse or logistics vehicle, the pressure that a shipment is being subjected to, and a variety of other factors that could compromise the integrity of a product.
Some can even alert businesses when shipments are tilted, rotated or incorrectly loaded. These actions could cause critical damage with sensitive electronics such as smart televisions and laptops.
Suppliers who have access to this information can contact their shippers and retailers while parcels are still on route. This allows them to address any potential damage issues before a compromised shipment arrives at its destination. Plus, they can address storage control issues with their shipping and delivery partners to ensure that goods get stored and handled appropriately in the future.
5. Improving Supply Chain Maintenance
Today’s supply chains rely on the optimal functioning of a wide range of elements, including the many machines involved in the chain. When any one of these machines malfunctions, it can slow or even stall the entire supply chain, causing untold headaches and significant expenses for the businesses that operate them.
Companies that place IoT-connected sensors in essential machines and equipment can monitor a spectrum of performance metrics. This enables their prediction of malfunctions and breakdowns, and allows them to plan preventative maintenance schedules in advance.
Those who use predictive maintenance techniques on the components of their supply chains are better equipped to anticipate and prevent problems ahead of time. Concurrently, they improve the lifespans of their equipment and reduce associated maintenance expenses.
The Internet of Things can help to reduce the operating costs involved in running a supply chain by identifying resource leaks and notifying supply chain managers about them. Having the ability to analyze this data determines the areas in which a company is overspending its resources. With this knowledge, the imbalanced expenditure is easier to address and rectify.
Additional Benefit: Ensuring Continuous Supply Chain Transparency
IoT has the power to improve the efficiency and quality of communications between all the parties and enterprises involved in the supply chain and logistics cycle. The interconnected nature of this technology allows managers to:
● Check if drivers are adhering to internal regulations
● If products are being stored and handled correctly
● If there are any delays between the warehouse and the product’s final destination
Supply chain managers who have access to real-time location, environmental, maintenance and productivity data can provide their employers’ and clients with accurate and prompt delivery status updates. This improves overall customer and client satisfaction, ensuring repeat business and consistent profit generation.
A Valuable Tech Resource
The Internet of Things is a relatively new form of technology. Yet it has already proven its considerable worth when it comes to intelligent supply chain management. McKinsey & Co forecasts that by 2025, IoT will have an inclusive economic impact of between $3.9 trillion to $11.1 trillion annually.
With the right software, tech and a few clicks of a mouse, it’s capable of drastically increasing the speed of modern supply chain operations. It offers more flexibility than on-premise supply chain management systems and allows for the more accurate sorting of data and finding patterns that can improve profitability.
Businesses that adopt and implement IoT technologies into their operations can gain the upper hand over their competitors. Plus, they’ll maximize their profit margins, and ensure the consistent efficiency of their supply chains for years to come.
Kristie Wright is an experienced freelance writer who covers topics on supply chain logistics, finance and management, mostly catering to small businesses and sole proprietors. When she’s not typing away at her keyboard, Kristie enjoys roasting her own coffee and is an avid tabletop gamer.
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