How Can the Internet of Things help remove supply chain barriers?

Over the years, a number of barriers have been experienced towards achieving the desired level of visibility, when it comes to industrial supply chain. It is not surprising that all stakeholders of the supply chain, from the consumers, the organizations and to the industry as a whole, have been at the receiving end, due to these barriers.

Timing has to be the most important barrier. Industrial supply chains related to electronics, pharmaceuticals and other manufacturing giants usually last for longer durations. As goods are transported through manufacturing hubs, testing centers and distribution facilities, it takes way too much time for comfort and effective tracking of such in-transit shipments becomes really challenging at times.

Secondly, large industrial manufacturing involves a multi-modal and multi-country set up where supply chain stretches across oceans. It may also have carrier segments on air, railways or roadways. New and challenging layers of complexity creep in while tracking such goods every time they cross international borders.

Apart from these generic bottlenecks, some specific bottlenecks also appear while handling manufacturing supply chains. These include the trucking terminals or ports that create sort of blind spots for logistics managers. Shipments can suddenly disappear, giving the managers no clue or insights regarding their whereabouts. Such a scenario can continue for months when shipments are stuck in such bottlenecks.

Conventional tracking systems of course exist but these are more tailor-made for the consumer world and are less effective when it comes to large supply chain system of the industrial world.

The new horizon in the industrial supply chain

Thankfully, the technological advancements in logistics operations have brought in an improved level of visibility into the process of supply chain management. The Internet of Things (IoT) has made a breakthrough progress and has completely transformed the conventional delivery systems into modern, data-driven supply chains. This has also made it possible for both the receiver and the shipper to have real-time visibility about the condition and location of the shipments all throughout the nodes of the supply chain process.

IoT and its operational impact

Due to the application of IoT in logistics, it has been possible to involve constantly connected trackers in supply chain processes. These trackers can monitor the condition and location of the goods in transit and send these data to the users in real time. Various other technological improvements also have facilitated the application of the IoT tools. Because of the improvement in sensor and battery technology, the tracking devices now can monitor everything from humidity, temperature, location, shock and other important parameters. The digital and wireless revolution happening worldwide has taken the communication network to new heights. The IoT devices can take help from the ever-functional global communication network to transmit real-time data to users sitting in any corner of the world. All these have made the supply chain tracking system highly reliable, yet, less expensive

These real-time tracking solutions are already making lives much easier for the supply chain management of any logistics organization. Easy access to condition and location data has made it possible for the managers to respond faster to logistics issues. For temperature-sensitive shipments transited widely in the global pharmaceutical sector, IoT – driven tools have worked wonders. IoT trackers can continuously monitor the temperature of such sensitive products throughout the journey of the shipment and can alert the manufacturer if anything goes wrong any time. The supply chain manager, armed with the real-time visibility provided by IoT tools, can immediately get in touch with the shipper and have the container reset to the correct temperature, thereby, saving the product.

Additionally, having real-time access to the contextual data can expedite the root-cause analysis of the long-standing issues related to the supply chain. As managers gain precise information about the location and time regarding the occurrence of an issue, they can destroy the source of the issue and prevent it from occurring again. For example, in case of a frequent occurrence of harmful shock events in a particular route, the IoT data can help a manager to pinpoint the location and timing of the damage. Then he can change the route of future shipments well in advance, in order to avoid the problematic area.

Thus, IoT tools make it possible for the manufacturers to handle an issue proactively and hence, can have a tremendous impact on the everyday operations of a modern supply chain management.

How Can the Internet of Things help remove supply chain barriers?

Data-driven approach and supply chain

These tools also provide access to new data sources to the logistics companies so that these companies can incorporate big data analytics and other data-driven strategies into their supply chains. In this way, they can increase efficiency, eliminate waste and optimize their supply chain system on a macro level.

Manufacturers can make use of the data analysis tools such as Statistical Process  Control (SPC) to improve their supply chain quality levels. SPC can compare any metric accessible through an IoT tracking system ( damage rates, delivery time etc) to previous high, low or average levels. In this way, problems can be addressed in a systematic manner rather than depending on guesswork to figure out how and when to act.

Also, when managers get access to contextual data, they can easily apply all available tools of modern techniques such as the Six Sigma frameworks to their supply chains. Lean and Six Sigma methodologies further enhance the industrial supply chain by providing a data-driven and quantitative approach to improve quality and reduce waste.

Big data analytics open up a lot of possibilities for the supply chain management. be it the access to real-time location data or the reduction of safety stock levels and so on. The manager these days get to know, well in advance, when there will be a delay in shipments and how much buffer stock need to be kept precisely, to address the same. They can also use temperature data to differentiate quality levels for carriers and thus, can enforce pinpoint and measurable standards of quality across every phase of the supply chain.