Understanding Internet of Things applicability in the Supply Chain

To the everyday person, the emergence of the Internet of Things (IoT) has been more of a “so what?” than an “oh, wow!” movement.

Knowing that your refrigerator has an Internet-bound sensor that can tell you when you need a new water filter is convenient, if not earth-shattering. In fact in recent years, IoT has been in the news more domestically for the problems it can cause, such as hackers breaking into devices like baby monitors that don’t have adequate security.

But for supply-chain management players, IoT is like being able to shrink yourself down to the size of a thumbtack and hitch a ride along with your products to see how well they fare on a trip throughout their journey.

With careful planning, the IoT can be your company’s eyes and ears as your products move from one destination to the next. Not only will this give you an inside view on things like quality control, time of delivery, and whether all security protocols are being met, but it also encourages collaboration across business areas that can expose the location of bottlenecks and slowdowns that might otherwise be missed if they were only viewed in retrospect.

IoT in Supply-Chain Action

There are an estimated 31 billion IoT devices in existence in 2020, with that number reaching as high as 75 billion in 2025. That can make it a bit overwhelming to imagine how they can be harnessed. So let’s break it down with an example that tracks our stock from one end to the other. For the purpose of this example, let’s say our company manufactures tasty ice-cream cone based desserts. Thus, things like temperature, speed, and quality checks are all vital to us. For our purpose, the IoT can be used to:

Monitor storage conditions of our products: We need ideal conditions for the ice cream to be added to the cones and then packaged. IoT sensors can take readings and monitor things like temperature, humidity, and exposure to atmosphere that can critically alter the quality of our products. These devices can even be programmed to sound an alarm if a certain temperature or level of humidity is breached, which can cut down significantly on the time it takes to spot a problem and remedy the situation.

Track speed of movement on deliveries and know in advance when products will arrive: Is there anything as annoying as punching up a dashboard and being told that your product is “En Route” or “On the Truck” or even simply “Scanned”. Technology works too well to rely on such rudimentary descriptions of the most pivotal step. IoT sensors can work as well as GPS to track their own positions, and that information can help the likes of distribution centers be ready to go in advance of the delivery.

Locate goods in storage: With the cavernous size of the modern warehouse, one mistyped code on a computer keyboard can result in big-time problems when the shipment that needs to be on the truck right now is nowhere to be found. IoT sensors eliminate this problem completely as their tags can be scanned the minute they arrive at the distribution center. This makes relocating them and confirming they are the product required as simple as scanning a barcode.