The world we live in wouldn’t be the same without the Internet. The instant access to information and the connectivity it provides us to all corners of the globe have forever changed the way we live and the way we work. The way we communicate with each other today is vastly different than how communications occurred pre-Internet.
Furthermore, it should come as no surprise that the development and widespread utilization of connected technology, otherwise known as the ‘Internet of Things’ (IoT), is poised to forever change the world of logistics and supply chain management. Through this fascinating technology, companies are gaining greater insights in to the effectiveness of their logistics operations than ever before and achieving levels of efficiency that were simply not possible before.
In this article, we will explore some of the biggest impacts the Internet of Things has had on supply chain management, and what these types of technologies can mean for the future of your business.
Asset Tracking with RFID & NFC Technology
As products move throughout a supply chain, traditional methods for tracking progress and location of each item would generally involve scanning barcodes or manually inputting data at certain checkpoints throughout the warehouse and transportation stages.
These traditional methods of asset tracking carry certain disadvantages, such as the possibility for human error, and the delays that would be inherent in waiting for items to pass from one stage to another before the data in the systems could be updated. Now, these disadvantages can be removed through technologies known as near-field communications (NFC) and radio-frequency identification (RFID).
Radio-frequency identification (RFID) relies on a small chip to be implanted or attached to products or packages at the beginning of the supply chain. This chip emits a signal that can be picked up by receivers and scanners throughout the various stages of your logistics facilities and transportation assets.
Once these signals are received by Internet-enabled devices that are equipped with near-field communications (NFC) technology, the data can then flow in real-time throughout your business systems. This flow of data means you can track the exact location of large shipments, packaged orders, and even individual products at any time throughout the entire supply chain.
With this level of insight in to the flow of items through your supply chain, you can provide increased transparency with customers on the status and ETA of their orders. In addition, this constant flow of information allows you to pinpoint previously hidden bottlenecks or trouble spots in your supply chain that can then be optimized for greater efficiency. Inventory management becomes easier and more accurate thanks to the Internet of Things.
Transportation Management & Connected Vehicles
The Internet of Things has also provided many enhancements to the capabilities of transportation fleets. Connected vehicles provide instant shipment tracking information at any time and can assist drivers with the most efficient route between locations, factoring in weather, traffic, and other potential delays with up-to-the-minute accuracy.
These enhanced transportation technologies don’t stop there, however. Connected vehicles can also be configured with sensors to track everything from gas mileage to tire pressure. This incredible level of granular data allows fleet managers to model their transportation networks, analyze routes and even preemptively plan service and repairs, minimizing vehicle downtime and maximizing the useful life of transportation assets.
Automatic Replenishment & Proactive Ordering
These amazing advancements in asset tracking and transportation management have also enabled the Internet of Things to deliver many benefits to the processes in other areas of logistics, such as purchasing and sourcing. Systems can be implemented that leverage the data provided by RFID and NFC technology, combined with Internet-connected devices to signal for automatic replenishment or reordering of raw materials, supplies, packaging, and other products and equipment needed throughout the supply chain.
This technology also has many applications on the retail and e-commerce consumer side of things as well. One of the earliest adoptions of these concepts to consumer products was the introduction of the Amazon Dash system.
This simple system consists of a small, inexpensive ‘button’ device that connects to the Internet through the WiFi in the home. When pressed, the Amazon Dash button sends a signal to the consumer’s Amazon account to automatically place a pre-configured repeat order for many of the common consumable products that they use in their home, such as laundry detergent, pet supplies, health products, and more. This ensures that customers are able to quickly and easily replenish their household products at exactly the right time. This was also a clever way for Amazon to increase repeat order revenue, and at the same time, increase the average lifetime value of a customer, both are important elements for any ecommerce retailer.
Implications of the Internet of Things for Your Business
While these examples are just the tip of the iceberg, you can inevitably see the vast range of possibilities that the Internet of Things can provide to your company in many different areas.
First and foremost, the added insight and efficient flow of data throughout your entire supply chain is a huge asset that can drastically improve your logistics operations. With this data, you can achieve higher levels of efficiency and make smarter decisions on how to optimize your supply chain and the assets within it.
You’ll also be able to invest in transportation resources that have longer useful life and lower operating costs, and then leverage those resources to move more products in less time than ever before.
The Internet of Things helps to reduce friction points at all stages of your supply chain, as well as in the lives of your customers. By making it easier and more convenient to place orders for the products and supplies they need, your customers are more likely to continue doing business with you and less likely to jump to a competitor.
Planning on a Connected Future
Right now, there are things that you can do to help your company benefit from the Internet of Things and also set the stage for future success as technology continues to advance towards an even more connected future.
Now is the time to start investing in mobile technology to enhance the productivity of your logistics teams, adopting cloud-based information systems to seamlessly pass information throughout your supply chain, and training your teams to understand and analyze the data to gain insight in to how to best optimize your operations.
If your business is ready to take the next steps in integrating the Internet of Things in your logistics operations and supply chain, contact the team at SCI today for a no-obligation consultation.