Just over a year ago, a Cisco survey found that the number one interest among more than three-fourths of supply chain management professionals was improving visibility. In an industry that still sometimes relies on technology from the 1980s, it is easy to understand why this tops the list – visibility unlocks the insights needed to improve efficiencies, velocity, and business results. We have found one of the best ways the supply chain management industry can achieve this real time visibility is through the Internet of Things (IoT). How can you take the right steps to ensure a successful IoT deployment and do more, better and faster?
The first – and most important – step those in the supply chain management industry should implement is to extend connectivity to new things and devices. It is impossible to achieve increased visibility without new connections, and previously it was often tough to do this across different companies, suppliers and modes of transport. However, by beginning with connection points that help to achieve real-time location visibility in the warehouse, factory and supply chain, we see businesses are typically able to quickly grow and extend visibility to a more detailed level, now even extending to pallets and boxes.
"The first – and most important – step those in the supply chain management industry should implement is to extend connectivity to new things and devices"
With connections across devices and silos increasing, businesses are able to achieve a new level of data insights. But with this massive amount of information also comes an increased need to understand it. It is not efficient to simply connect everything, and communicating data from across many types of IoT systems needs to be done in a way that is understood. By organizing the information in a way that makes sense for your business, however, it will no longer be necessary to rely on secondary sources for information. Instead businesses can directly follow a product throughout its lifecycle – from when it is built, to when it is shipped, reaches the warehouse, and is delivered.
We also have seen how IoT can enhance the customer experience. New connections will improve product quality by better monitoring temperature, humidity or shock during transit end to end from when the product is manufactured all the way to the consumer, all of which can be important for items like food and pharmaceuticals. By being able to connect to an exact package, businesses can confirm whether a package was actually delivered and track where it is with greater reliability.
With the help of these improved connections and visibility, the supply chain industry will also be able to tie production to customer demand. Orders and production will be better dictated by market need, as opposed to having to build stock or forecast. It can be described as “built to order” but in a new way — creating a new type of customer experience.
Logistics will also eventually evolve to an “on demand” model with the help of IoT. For example, with better connections, a company can know in real-time how many packages or pallets are on a truck and be more efficient with their delivery schedule. They will also have new visibility to spare logistics capacity, in time for them to potentially leverage this capacity in new ways. This type of capacity optimization can also reduce fuel use and wear and tear on vehicles, creating new efficiencies and savings.
IoT is here to stay in supply chain management, and it all starts with increasing your connections. These IoT connections will provide the visibility that so many supply chain management professionals want – and need – to realize their businesses of the future. We are just at the beginning of this journey.