Why Use IoT Solutions for Supply Chain Management?
You might have heard about IoT before and how it will transform every major industry - from retail to connected vehicles. However, one of the key areas where IoT is set to make a strong impact is supply chain.
Yes, IoT will revolutionize the global supply chain. Iot along with other emerging technologies like Artificial Intelligence, cloud computing and digital twins have the potential to streamline supply chain activities and make it more efficient. In today’s business world, supply chain isn’t only an option to deliver goods to your customers on-time. It’s a way to get past your competition by making it more efficient and less complex by embracing modern IoT development services.
Let’s explore the key reasons why your business must employ IoT in supply chain operations:
Table of Contents
- How IoT Solutions Affect Different Aspects of Supply Chain
- Benefits of Internet of Things In Supply Chain
- Challenges related to Implementing IoT in Supply Chain
- Why Use IoT In Supply Chain
How IoT Solutions Affect Different Aspects of Supply Chain
Streamline Asset Management
Unlike traditional systems where manual data logging was required to track asset conditions, IoT connected systems make asset information updates automatically in the entire supply chain network. By attaching an RFID tag on each product or shipment container, supply chain managers can get instant updates about the shipment location as well as delivery of parcels.
IoT application empowers a connected network that automatically locates and transmits goods from one place to another in a supply chain network. It is helpful at large warehouses owned by shipping & logistics companies. Automation in inventory tasks cut costs, reduces human errors and improves productivity.
Better Resource Management
Optimum resource utilisation and detecting errors are two aspects where IoT solutions assist supply chain managers the most. Managers can identify the areas in the supply chain where the company is spending more resources compared to the output. Predictive analytics principles can be applied by them while using connected systems to detect supply chain machinery errors before the inventory systems go down.
Benefits of IoT In Supply Chain
Improved Operational Efficiency: IoT includes a wide range of connected platforms that works together to streamline workflow. IoT along with advanced technologies and tools like smart glasses ensure warehouse staff require less time to finish common inventory tasks. IoT devices capture business-critical data that brings more awareness among supply chain managers related to resource management.
Higher Accuracy: Supply chain managers can get in-depth insights about goods turnover, delivery challenges or supplier issues with advanced IoT solutions. Chances of human error at production facilities decrease when IoT devices are used to track packages.
Better Decision Making: IoT along with other next-gen technologies like Artificial Intelligence and cloud computing helps logistics owners in analyzing critical data from every part of the supply chain loop. Real-time analytics and information at hand improve strategic decision-making capabilities.
Better Revenue Opportunities: The obvious use case of IoT is reducing supply chain costs by optimizing it carefully. However, another interesting application includes increasing supply chain transparency that can help you build better customer relationships. How? Here is an example. Use AR/VR along with IoT and allow your customers to see where your product comes from, how many countries it travelled, who made it and even whose celebrity hands touched it. Doing this, you can build a reputation of social responsibility and identify new revenue streams.
Improve Flexibility: With cloud-based IoT systems in place, all relevant parties of your supply chain network can access critical data anytime, anywhere. Supply chain managers get insights related to critical scenarios or events like delivery route problems, and can also guide their staff on how to overcome those challenges.
Challenges related to the Implementing IoT in Supply Chain
Lack of Knowledge and Awareness
Managing connected systems requires special training to warehouse staff and vehicle drivers. Due to lack of time and resources, many small shipping & logistics solution providers fail to integrate advanced systems powered by technologies like IoT, cloud computing, digital twins and more.
Finding a dedicated team who offers reliable technology support and custom solutions is a task too. With international supply chain tech talent shortage in mind, supply chain manages should focus on hiring skilled professionals.
Data Security Threats
A secure IT architecture is the key before fully transitioning supply chain processes to connected systems. As a logistics owner, you must know any data processing and security vulnerabilities can result in the loss of important company information and documents. It can also hamper your businesses reputation greatly.
To avoid loss of critical data, you must apply big data analytics concepts and cryptographic hardware monitoring or encryption techniques to mitigate outside security threats and store data safely.
Data Storage and Processing Challenges
Cloud-based IoT systems are a great advantage for supply chain managers today. However, with that power, securing data and acquiring enough storage power to process all collected data is crucial. Developing robust data governance and storage policies, and hiring expert data scientists is crucial for companies to overcome these challenges.
Poor Internet Connectivity
It's worth noting that IoT solutions require seamless internet connectivity. Since the fleet movement also happens in areas with poor internet networks- assurance of a reliable and connected network is never a guarantee. However, with 5G infrastructure rolling out soon in every country - this issue will resolve soon.
IoT-connected systems also require a lot of Bandwidth and high-level sensor farms in place. Keep these things in mind too before approaching IoT development services.
Reasons to Use IoT In Supply Chain for Businesses
Perform Real-time Asset Tracking
By Implementing smart IoT solutions, you can enhance your overall supply chain visibility. Tracking numbers and barcodes were the traditional methods used earlier throughout the supply chain. But, with IoT devices in place, that method has become obsolete now. With new RFID and GPS sensors, you can track products “from floor to store” accurately with real-time updates.
Granular information like how long the product was stored in cargo, container temperature and even how much time it took to fly off from inventory are easily available for manufacturers today with IoT applications. What you get ultimately from all of this is superior control on product quality, on-time delivery and product forecasting.
Monitor Storage Condition Of Assets
Apart from tracking shipment location, getting updates about container condition is important. Using IoT-enabled sensors, you can keep a bird’s eye on the environmental state of shipment containers. This will instil confidence that your goods are safely transmitted. Details like the temperature inside the container, pressure, humidity and other factors are vital for companies, delivering sensitive products like medical supplies.
For example, a pharmaceutical company would surely like to get updates about shipment container temperature, carrying its medical supplies. Any deterioration in medicines during transit would lead to serious public health issues and damage company reputation. With IoT-enabled solutions, retailers or manufacturers can move past these issues.
Forecast The Movement And Delivery Of Goods
The bulk of data supply chain managers today receive from IoT-enabled sensors improve the quality of decision-making and increase the accuracy of delivery forecasts. Not only that, triggering administrative tasks after validating product delivery also becomes easier for you, as a manufacturer. You can trigger tasks like supplier payments or onward shipping requests with confidence.
Easily Track Location of Goods At Warehouses
Goods at large warehouses need to be tracked immediately to fast pace the “picking-packing-shipping” process. By tagging goods with IoT devices, tracking becomes easier at distribution centres. You should definitely partner a reliable enterprise software solution provider to get custom IoT solutions that suit your supply chain goals. This will help you in the identification and management of goods.
Combining IoT with Artificial Intelligence you can also use autonomous vehicles or robots at your warehouse for good storage and retrieval from inventory racks. This will enable a seamless workflow with minimum human supervision.
Improve Contingency Planning
Contingency planning is one aspect supply chain companies focus a lot. Planning delivery routes, analyzing past trends for delays or accident events are common for supply chain managers while preparing flexible contingency plans. With IoT, curating data that’s critical for contingency planning becomes easier. Tracking the problematic areas in goods delivery and finding alternative routes becomes easier with IoT. Also, you can replicate the supply chain by using IoT-driven digital twins technology to track delivery problems.
Maintain Better Vendor Relationships
As discussed above, the asset tracking data you obtain from IoT devices can be used to improve your product schedules and secure sub-par vendor relationships. Here is an example: IBM Watson Artificial Intelligence solutions is a major resource to optimize the supply chain for global businesses.
Their data indicates up to 65% of value of a company’s products or services comes from its suppliers. How suppliers handle and deliver your products, once it’s made is critical. Because high-quality goods ultimately mean better customer relationships and retention.
Predictive Maintenance of Inventory Storage Items
Of course, you can use IoT-enabled sensors in your manufacturing facility to track the “wear and tear” in containers or other storage items. And, plan the predictive maintenance to prevent needless downtime that cost you business greatly.
Reinvent Your Supply Chain with Powerful IoT Solutions
The Internet of Things probably has the most effective use cases in the supply chain arena. Research shows nearly 70% of the retail and ecommerce business are already using cutting-edge tech like IoT, AI and digital twins to transform their supply chain. And why not, IoT brings automation, better efficiency and more transparency in the supply chain.
If you are also looking to streamline your supply chain operations, the time is right now. Join hands with A3logics. We’ve been offering reliable IoT development services to reputed clients worldwide for the past 10 years. Our experts have delivered IoT solutions for retail, banking & finance, supply chain and other major industries.
Drop us a line to discuss your next IoT development project. We are ready to help!