Implementing IoT in Supply Chain ( Pros and Cons )

Implementing IoT in Supply Chain ( Pros and Cons )

As we all know, inculcating IoT can equally solve a number of problems faced in the supply chain today. For example, sensors can be tagged on products or shipments which will possibly allow interested parties to easily track items throughout the product cycle. However, this is especially crucial in the retail sector, where efficient and effective inventory management is necessary to avoid issues relating to stockouts, stock obsolescence and futile trade marketing efforts etc to mention but a few. So with real-time tracking of inventory, a business can be managed effectively and efficiently through the insights received from the supply chain process. This on the other hand also helps in effective decision making, vendor relations, accountability, maintaining customer and, proper fund management etc as the case may be. More importantly, IoT offers the following benefits and importance to supply chain, they are as follows:

• Stock management
• Higher reliability of operations
• Higher reliability of operations
• Sales data insight
• Improved profitability
• End-to-end visibility of products

As we have it, Discovery and Tive are two such companies presently which are seeking to effectively disrupt the traditional supply chain process with their efficient IoT solutions. Discovery is working earnestly is building an IoT network for supply chain and is creating a printable self-charging IoT tag, which they call Cliot, priced at $0.10. Cliot utilizes backscattering technology to power itself up. Morealso Cliot is being built to support a number of sensors such as an accelerometer, IR, temperature sensors etc to mention but a few. However, besides utilizing edge computing, Discovery has gone a long way in creating a highly scalable network, where, their tag (Cliot) transfers data to nodes in the network formed by a community of smartphone users, this data is then immediately processed on smartphones and thereafter uploaded on the cloud.

Furthermore, on the contrary, Tive utilizes a tracker that houses multiple electronic sensors for sensing temperature, motion, etc. to mention but a few, which transmit data using a basic cellular connection to the cloud to be processed further and receive insights into the data. As clearly seen above, such solutions can effectively resolve the existing issues faced by supply chain by easily addressing all concerns related to the inventory management, visibility, fluctuating customer demands, supplier networks etc. to mention but a few. For example, Nestle could easily tag each chocolate produced by them at the company and with the help of powerful analytics tool, Nestle could see the Consumer Purchase Data across all markets and strategize their production and business in a much more effective manner, thereby, boosting their net revenue as the case may be. Morealso, authentic insights into Consumer Purchase Data and behavior can easily assist them in making effective marketing campaigns. This can easily take away the crucial need for traditional data and other time-consuming approaches of market research.

Despite all the advantages and ease of business that IoT provides for supply chain industry, there are also certain challenges in implementing them. As IoT is not a matured technology yet, some of the issues faced in its implementation may also be unanticipated.

below are some that i have taken my time to high light and briefly explain.



Skill Gap

In a report by BPI network, based on a survey of 350 executives, 90% of the respondents mentioned that Industrial IoT (IIoT) is a strategic focus whereas only 9% said that they began a widespread adoption of IIoT. Still in the survey, 60% of the executives cited major skill gap to be a major reason for such a dismal state of IoT adoption. As IoT requires multiple skill sets such as data analytics, hardware expertise, embedded software development, app development and etc., it is not surprising that relevant skills are hard to find. In a report by Canonical, the maker of Ubuntu, it was found that 68% of businesses struggle to find the right talent for IoT.

Managing Data

IoT's attractiveness lies in its ability to gather a large amount of data and provide unprecedented visibility into processes. Although, getting data isn’t the sole reason for implementing IoT, storage, and analysis of data is what makes the data useful. In order to extract IoT's complete usefulness in the supply chain, there need to be efficient data handling systems in place. In essence, sophisticated data management tools are necessary to gather data and make sense of what is received from the numerous sensors.

Security

Anything that has to do with network communication is susceptible to hacking and cyber attacks. As supply chain is a large part of every industry, widespread adoption of IoT also risks critical security issues. In the event of a cyberattack on an enterprise's supply chain, complete operations can come to a standstill causing enormous revenue loss for enterprises. The 2016 Dyn cyber attack was a blot to IoT and is still a reminder of the vulnerability posed due to connecting things through the internet.

In conclusion, at a time when market competitiveness is extremely high, business strategies need to incorporate innovative as well as creative ways to stay relevant. Supply chain being a major component of every consumer based industry; bringing innovation to its management will undoubtedly increase the competitive edge of any enterprise. IoT is one such solution that can drastically improve supply chain management by providing numerous benefits, which in turn would bolster any company's business. As consumer trends and their preferences change over time, consumer product cycle shall also adopt those changes and hence, smart and efficient solutions are enabled by incorporating technologies like IoT.

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