IoT for Smarter Supply Chain and Logistics Management
Internet of Things (IoT) solutions enable significant optimization of supply chain and logistics management processes, providing transparency and cost efficiency that cannot be achieved without using these advanced technologies.
If you are new to IoT, here is how it works in SCM. Internet-connected devices (e.g., image, temperature, humidity sensors, GPS trackers, etc.) allow real-time data collection on stored and transported goods, inventory levels and shipment status, environmental conditions in warehouses and vehicles, etc. The collected data is processed, stored, and analyzed in the cloud, enabling continuous end-to-end supply chain monitoring and quick response to any changes. For example, if sensors detect deviations from the set temperature in cold rooms, the controlling application sends a command to adjust the temperature to actuators and notifies supply chain operators.
Advantages of IoT for Supply Chain and Logistics Management
Supply chain management is a multistep process often involving several participants. Each participant can leverage specific IoT advantages.
Raw Material Suppliers use IoT solutions to track technological processes, for example, collect real-time data on crop conditions and livestock health in agriculture and farming, monitor fires and logging in forestry, analyze oil composition in pipelines during oil extraction, etc. The data helps them increase actual production volume, improve raw material quality, reduce energy consumption, and ensure profitability.
Manufacturers implement IoT solutions for real-time monitoring of production operations and equipment status. Continuous control allows identifying bottlenecks and making necessary adjustments, reducing downtime, increasing equipment utilization, and improving production efficiency. IoT also contributes to environmental safety: tracking electricity and water consumption, as well as monitoring emission levels, helps comply with environmental regulations and implement green strategies.
IoT provides transparency and accuracy in logistics, as logistics operators receive real-time data on the location and condition of each asset. With this data, they can track and optimize the entire delivery route in case of changes or delays. IoT solutions also help manage cold chains and ensure the integrity of perishable goods by detecting deviations from recommended transport conditions.
The Internet of Things facilitates inventory tracking and increases visibility and accuracy of warehouse operations. IoT solutions also help preserve perishable goods by monitoring storage conditions.
Retailers benefit from optimizing the picking and loading/unloading process with IoT solutions, improving picking accuracy and handling efficiency. IoT solutions help track product movement on shelves, ensuring maximum inventory visibility, and monitor store traffic to optimize product placement and space utilization.
How Global Brands Are Transforming Their Supply Chains and Logistics with IoT
Global brands quickly recognized the benefits of IoT and began using this technology to further improve their SCM and logistics processes.
For example, Amazon improved its warehouse management with IoT devices that scan QR codes and identify products. Automation allowed the company to use personnel more efficiently, reduce operational costs, and increase overall warehouse efficiency.
DHL's IoT-enabled system provides operators with data to ensure high availability of roller cages. Another DHL IoT initiative uses smart HVAC systems and adjusts their operation in real time based on weather conditions, building occupancy, etc., to minimize energy consumption.
Companies Volvo and Nissan also benefit from IoT. The former uses IoT to track vehicle deliveries to international customers, and the latter implemented an IoT-based warehouse management system at its UK plant.
Maersk, a leading Danish shipping and logistics company, implemented a system called Remote Container Management. It monitors temperature and humidity in sea containers and helps operators prevent spoilage of perishable cargo, reduce waste, and improve transport planning accuracy.
Agri-tech company Aker Technologies offers agricultural suppliers an IoT system that uses drones, 3D video sensors, big data solutions, and machine learning to detect crop damage from various factors and promptly take necessary measures.