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IoT in focus: Transforming the supply chain

  • Supply chain IoT helps business leaders make decisions that save time, expand operations and bolster revenue.
  • A connected supply chain can quickly react to new trends — adjusting production schedules within days, not months.
  • GPS and fleet management solutions can optimise route finding for freight vehicles and automate communication to further boost efficiency.

The Internet of Things (IoT) is powering a major digital transformation in supply chain management that's set to touch every part of the chain from floor to store and beyond.

Whether it's asset and inventory tracking, maintenance, vendor relations, fleet management, planning or any other operational element, supply chains can now be connected, monitored, managed and optimised from top to bottom with IoT-based technology.

Here's a sampling of what the connected supply chain could soon do, or is already doing, to help businesses innovate and grow. 


Asset tracking and fleet management

RFID tags, SIM cards and Internet-connected GPS sensors attached to products and other assets allow supply chain managers to track their whereabouts at all times, to ensure not only that they get safely where they need to be but also that they get there in a timely fashion. 

Complementary assets and other stages in the supply chain can be better coordinated with this data, too. Forklifts, cranes and factory hands might be readied for loading and unloading, for instance, coordinated down to the minute thanks to the coupling of this near real-time data with cloud computing and predictive data analytics. 

Efficiency gains are then further boosted by GPS and fleet management solutions that can optimise route finding for freight vehicles and automate communication so that every stakeholder can get all the data they need to make key decisions right when they need it. 

New business opportunities

IoT sensors in the supply chain can also create major new business opportunities. Take fresh produce exporter Peloris Global Sourcing for example: 

It's crucial that the temperature of fresh milk stays between 0 and 4 degrees Celsius throughout its journey from farm to supermarket shelf, and that the milk gets consumed within three weeks of production. Both of these used to be a stumbling block for milk exports to China, which normally involves a lengthy approval process that’s as long as the milk’s shelf life.

But now with location and temperature monitoring technology that's been endorsed for rapid border clearance (of around 36 hours) by China's Inspection and Quarantine Bureau, Peloris can sell fresh Australian milk — and other fresh Australian produce — in China with a 100 percent compliance record. As of September 2017, the company was responsible for around 30 per cent of fresh milk exports into China worldwide. 

But now with location and temperature monitoring technology… Peloris can sell fresh Australian milk — and other fresh Australian produce — in China with a 100 percent compliance record.

Similarly, trials of temperature and location monitoring tech in Australian mango exports to the United States during the 2017/18 season indicated that their quality may be compromised by unexpected delays in the distribution chain. These delays caused an undesirable amount of temperature variation within the mango pallets, which in turn may have reduced the quality of produce — a problem made worse by its market positioning as a premium fruit product. Without IoT tech, this probably would have continued to go unnoticed.

Tracking technologies like this could shake up vendor relations by exposing instances of poor handling or needless delays, which might lead — for better or worse — to suppliers prioritising business with the vendors that treat their wares the best. Either way, streamlined data collection and monitoring from one link in the supply chain to the next will likely improve efficiency, productivity and quality control, and for consumers and other end-users it could translate into better, cheaper and more reliable products and services. 

Man on iPad in bakery

Optimised production

The latest IoT sensors can do more than just passively record data and beam it up to the cloud; they can actively tweak, refine and even outright control operations of equipment and machinery in factories and warehouses — all according to data-crunching algorithms and AI routines.

Maintenance schedules can move to predictive rather than reactive or set patterns, based on detailed analysis of actual equipment condition, operation and performance metrics. And AI powered IoT might uncover underutilised areas of production and storage capacity or previously-unnoticed bottlenecks that hold up greater efficiency gains.

Better yet, with a complete view of the supply chain, managers can make more accurate forecasts and smarter decisions to elevate their business to the next level. And if businesses can shift to a fully-integrated supply chain they can then become wholly demand-driven, reacting instantly to fickle consumer trends.

Transforming the supply chain to invent new markets

On top of all these efficiency and productivity improvements, IoT could completely transform the interaction between the two ends of the supply chain. For many types of products, embedded sensors and IoT services could remain active through the lifetime of the product.

For fresh produce like milk, seafood, fruit and vegetables, this ensures consumer confidence in the quality of products — as it means that brands can protect their produce from any unscrupulous fraudsters who might sneakily swap low-quality food into the premium pool.

For other types of goods, this change could require an overhaul to sales, operations and R&D to account for a shift in value proposition from physical products to complete integrated solutions. A connected supply chain is also one that can quickly react to new trends — adjusting production schedules not months in advance, as was the norm just a few years ago, but rather within mere days, so that stores can meet demand for whatever the flavour of the week is on social media.

But for all industries, no matter what their product type, IoT in the supply chain promises to empower major transformation. It helps business leaders make great decisions that save time, expand operations and bolster revenue, with a game-changing, customer-focused impact across the whole supply chain. And most critically, IoT solves problems that can open entirely new markets.     

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