Supply Chain

IoT in supply chain management

Consider a warehouse that handles a few thousand products for an e-commerce company. The warehouse leverages data from its internet-of-things (IoT) devices that automatically track the quantity of each product and raise an alert or automatically place an order to replenish the stock once it falls below the defined threshold. That is just one of the many transformations IoT can bring in managing supply chain and logistics.*

Some examples of companies successfully leveraging the power of IoT are Amazon, Volvo, and Nissan Motor Co. Volvo uses IoT supply chain to track its vehicles’ components from several countries and vehicle deliveries to its global customers. Nissan uses IoT supply chain to link its multiple industrial units. Amazon has been using a fleet of IoT-enabled robots to manage warehouse operations by scanning the QR code on packages. The role of IoT in supply chain management is vital for a business to grow. Let’s look at a few benefits and challenges of IoT in supply chain management.


The benefits of using IoT in supply chain management

The COVID-19 pandemic and the subsequent global geopolitical events have demonstrated that supply chains are not as resilient as one might have assumed. As goods travel larger distances and exchange more hands, there are more chances of disruptions. In such a scenario,  IoT can help businesses in managing such unprecedented situations.

  • Track real-time location: IoT devices can help you track the position of goods at all times, be it inside a large warehouse or on a ship. If you ship the products on a wrong route, the IoT system delivers automatic alerts to fix the problem.
  • Monitor storage condition: Many goods are prone to damage from environmental conditions such as humidity, heat, pressure, and cold. IoT devices can gather the environmental data from a warehouse or a truck and automatically adjust the conditions.
  • Locate goods within the warehouse: Finding the right product and constantly tracking its quantity in a large warehouse can be difficult. IoT in supply chain management increases efficiency and boosts employee safety. When IoT is used in combination with artificial intelligence (AI), it can fully automate the warehouse with minimal human supervision.
  • Improve contingency planning: With IoT and data analytics, managers can predict and plan for contingencies such as traffic, weather, possible accidents, or other delays. Managers can develop flexible contingency plans based on the movement of goods and use real-time alerts to mitigate risks.
  • Enhance total supply chain performance: Equipment breakdown can affect the performance of supply chains. IoT sensors used for predictive maintenance can schedule appointments with technicians to proactively fix the machines that handle goods throughout the supply chain.
  • Better segmentation of goods: Data from IoT devices can help logistics managers better segment the goods throughout their life cycle according to their target market or other segmentation parameters. Managers can understand the marketplace better and build relevant strategies.

Challenges of IoT in supply chain management

A successful implementation of IoT in supply chain management has its own set of challenges, which can be resolved with the right vendor and technology.

  • Skill gap: The warehouse staff and vehicle drivers need to be trained and educated about the security practices and the guidelines for using corporate IoT-based supply chain management platforms.
  • Data storage challenges: The large pool of data that IoT systems generate is both a benefit and a challenge. There needs to be enough server power to store and process the collected data. In addition, there must be data governance policies to derive the right conclusions.
  • Security threats: Before switching to fully connected systems, you need to have a secure IoT architecture. Vulnerabilities in data can result in outside attacks and leaks. By implementing machine learning (ML) and cryptographic hardware monitoring, managers can mitigate security threats.
  • Connectivity issues: IoT platforms and devices rely heavily on internet availability and other short distance technologies such as Bluetooth and NFC. As the internet coverage increases and 5G becomes available, this issue will resolve automatically.

How can Infosys BPM help?

Infosys BPM partners with organisations to streamline and digitise their supply chains. The end-to-end solutions across consulting, technology intervention, and managed services help run supply chain planning as a service. The solutions include:

  • Supply chain diagnostics
  • Supply chain shared services advisory
  • Supply chain control tower
  • Forecasting as a service
  • Inventory optimisation

View the supply chain optimisation services from Infosys BPM.

*For organisations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organisational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organisations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organisations that are innovating collaboratively for the future.



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