How IoT is shaping the future of supply chain visibility
The supply chain is one of the most visible beneficiaries of digital technology. Currently, 87 percent of all manufacturing companies have either already adopted or are in the process of deploying a digital strategy to improve supply chain visibility, and IoT is the cornerstone of that transformation.
The complexities of managing scale and increasing global demand are driving the trend. Companies like Walmart, for example, may have more than 100,000 suppliers, making it particularly challenging to keep track of goods in transit.
Preventing loss, ensuring integrity
By some estimates, more than 1,400 shipping containers are lost each year. When you factor that into the total number of containers on the sea at any given time—a quantity somewhere between five and six million—that may seem like a drop in the bucket, but the losses can add up significantly over time.
Whether the losses are attributable to theft, piracy, negligence, or natural disasters, the result is the same. With more than $30 billion in losses just in the United States, end-to-end supply chain visibility is needed to identify the source of potential problems and prevent these losses from occurring.
The Internet of Things (IoT) proves its value by offering complete visibility into every aspect of the supply chain journey. From individual packages to entire containers, companies can monitor location, condition, integrity, and other critical information about their shipment that is not ordinarily available in the realm of traditionally managed logistics.
Without the benefit of IoT, companies would only be able to track their shipments as they arrived at checkpoints, but not in-between. With IoT sensors applied, shipments can be monitored at every stage, allowing complete quality control and quality assurance while minimizing loss. A good example of this would be in perishable food supply chains, where sensors could detect freshness and quality in real-time.
IoT with blockchain
Other transformative technologies, like blockchain, for example, rely on IoT to operate. In terms of visibility, this combination—IoT and blockchain—make an unbeatable duo. Blockchain encourages wider IoT adoption and offers a way to eliminate loss, whether from fraud or errors in routing. With the ability to accurately track and trace, companies can realize substantial cost savings, boost efficiencies, minimize damage, and ensure shipment accuracy.
Wider IoT adoption is needed to realize the most significant change
Despite its infinite potential, IoT is only as good as its connections. If only a handful of suppliers are connected to that network, progress will be limited. Were sensors to be embedded in everything from parts to raw materials, complete visibility into the supply chain would become real, allowing companies to achieve gains in areas that include:
- Supply chain management, logistics, and asset tracking solutions
- Inventory and warehouse management, leveraging passive RFID tags
- Fleet management, enabling better asset tracking and other efficiencies
In conclusion, IoT is transforming industries worldwide, offering solutions that deliver quantifiable value from end to end. If you would like to learn more about what IoT can do for your business, reach out today.