What are the supply chain applications supported by the Internet of Things

As companies continue to narrow their business scope to core processes through third-party outsourcing, the global supply chain continues to grow. This creates the need to track and control a large number of assets and processes. To keep up with this trend, companies are adopting IoT-enabled supply chain management.

Almost every business, regardless of its area of operation, will operate as part of a larger business network. Even services, such as health care and education institutions, form part of the supply chain. These supply chains may involve multiple people, facilities, assets, and businesses that need to coordinate and manage the flow of goods and services from major production locations to final sales and consumption locations. The larger these supply chain networks, the more difficult it becomes for owners to monitor and manage these processes. This difficulty is mainly due to the complexity brought by many variables when more people, processes and businesses are added to the chain. The introduction of the Internet of Things (IOT) helps companies overcome these challenges.

Supply chain management supported by the Internet of Things is becoming a viable solution to the problem of supply chain management control and visibility, while also adding more value and solving more problems.

IoT-powered supply chain: applications

The supply chain supported by the Internet of Things connects manufacturers (such as farms, mines, etc.) with end consumers (businesses or individuals) through a network of smart devices. This network not only collects and transmits real-time information from one end to the other in the finest form, but also enables supply chain owners to control activities at each stage. This will ensure that the supply chain can deliver the right amount of goods or information to the right people at the right time. Several aspects that the Internet of Things can add value to the supply chain are as follows:

▲ Track cargo movement

Logistics is a key enabler of the supply chain because it is responsible for moving goods and resources from one end of the supply chain to the other. Logistics is usually provided by third-party service providers. Although the transportation status of goods can be reported at fixed time and distance intervals, the estimated arrival time of goods is often misjudged, which may cause unnecessary trouble in the supply chain. In addition, perishable goods such as meat, milk, and agricultural products must be transported under appropriate storage conditions, which means that the carriage must be maintained at a specific temperature and humidity level.

Using the Internet of Things network, companies can monitor the maintenance conditions of goods during transportation. When these conditions reach non-optimal levels, storage conditions can be changed remotely, or the Internet of Things network can also automatically adjust the temperature in the cargo box according to the situation. The Internet of Things can also help protect goods in transit from theft and loss. Stakeholders can use GPS and other tracking methods to know the location of the cargo at any time.

What are the supply chain applications supported by the Internet of Things

▲ Monitoring inventory

Modern supply chains always maintain the optimal amount of raw materials in their inventory for lean manufacturing operations. To do this, they need to maintain sufficient supply to avoid depletion and cease operations while ensuring that there is no backlog of cargo. This requires them to order supplementary raw materials based on multiple factors when their inventory reaches a certain level. IoT sensors can be used to monitor a manufacturer's inventory and notify relevant personnel when the quantity drops to a critical level. This enables manufacturers to order replenishments in a timely manner to ensure the lowest cost, least waste, and uninterrupted operation.

▲ Maintenance equipment

Supply chains often involve many equipment, whether it is a production tool (heavy machinery) or a transportation tool (truck). These devices must always be maintained at optimal levels of health and performance to ensure the continuity of business operations. Any downtime due to equipment failure can trigger a chain reaction that affects the entire supply chain and can lead to severe financial losses.

IoT sensors can be used to continuously monitor manufacturing processes and equipment to monitor any anomalies. This allows maintenance personnel to check and fix any issues before they become serious. Performing such maintenance operations in a timely manner not only helps prevent any unnecessary downtime, but also prevents serious, irreparable equipment damage that could lead to huge future costs. IoT sensors can also be mounted on vehicles to track their performance and health. This minimizes delays in the transportation and delivery of materials, components and finished products by triggering preventive maintenance when needed.

▲ Assessing needs

The Internet of Things has played an important role in the transformation of the retail industry, and retail stores are the sales and distribution channels of the supply chain. IoT sensors can be installed in stores to track the number of different items on the shelf. These sensors can be connected to other parts of the supply chain, including warehouses, distribution centers, and manufacturers. When a certain item in a store is about to be sold out, sensors will detect it and notify the nearest warehouse via the IoT network. When there is not enough stock for a certain item in the warehouse, they can notify the manufacturer, which can trigger an IoT device located there to communicate with the supplier, and so on. As a result, IoT networks can automate coordination between different parts of the supply chain to maximize overall productivity.

IoT-enabled supply chain: benefits

In addition to industry-specific benefits, the IoT-enabled supply chain offers the following benefits:

▲ Visibility

All other members of the supply chain have real-time visibility into the processes and needs of other partners. This enables all supply chain partners to synchronize their operations for maximum efficiency.

▲ Control

In addition to being able to monitor their own and partner's processes, they can also automatically and instantly control process parameters to better respond to emergencies. A supply chain fully supported by the Internet of Things can minimize the waste of time, materials and money. In addition, the IoT-supported supply chain achieves perfect coordination between partners through continuous communication, visibility, and control, which means that the right amount of goods or resources can be provided at the right place and time-ensuring maximum Operational efficiency.

To cope with increasingly complex supply chains, businesses will need multiple forms of digital technology, and the Internet of Things is just one of them. In addition to the Internet of Things, the application of artificial intelligence and blockchain technology in supply chain management is also believed to bring revolutionary changes to the industry. However, any new technology introduced in the industry must be built on and integrated with the IoT-enabled supply chain framework.