In the Supply Chain, IoT Means “Internet of Truth”
From Loic Barancourt, CEO, Thinxtra, The IoT Telco
Businesses in general, and supply chain and logistics organisations in particular, understand the concept of the Internet of Things, but many have been wary of implementing IoT until recently, not least because of the hype around it, and the risks, expense and complexity perceived while assessing the business case. However, the Industrial IoT (IIoT) space is surpassing the hype and has matured significantly in terms of technology viability and operational feasibility over the last three years.
Being able to deploy accessible, achievable and affordable IoT solutions at scale to track and trace supply chain assets in real time, to reduce costs, and remove inefficiencies and delays, has never been more appealing as supply chains are rebuilt to accommodate national and international constraints around the world.
There is another factor also at play: the motivation to have a clear picture of the truth within the supply chain, to be certain about the status of assets and goods moving up and down the supply chain, and to increase the clarity around accountability along the supply chain.
It’s our experience that anyone working anywhere in a supply chain, whether it’s the manufacturer, the asset pooler, the shipper or the customer, will have been unclear at some point about the true status of the location of assets, the condition of goods, or the status of delivery schedules. Supply chains are by their very nature complex, but whatever the reason for errors or missed deadlines, the consequences are expensive, and customer experience is degraded.
In the supply chain, “IoT” can also therefore equate to the “Internet of Truth” – where “truth” means clarity, accountability, and all the data required to make better decisions, with certainty, around assets, movements and logistics.
Here’s a recent example – one that affected Thinxtra itself. One of our project managers had to explain to a customer of ours that their IoT devices were going to be delivered one week late. Beyond the obvious and immediate annoyance lay a real business consequence: our customer had taken steps to fit these devices to their assets and had subcontractors mobilised and ready to install 1,000 trackers in one day. So a delivery in batches of 200 per day was not good news.
The reason given for the delay by our manufacturing partners was COVID-19, but there was no means to verify this because we ourselves could not immediately see where the order was in its journey from the manufacturer to us.
Inevitably, my inner mind asked three questions: Is this true ? Or are they seeking to avoid liquidated damages for breach of contract? And are the new dates I have been given reliable?
What really worried me was that our customer (a world-leading supply chain expert who knows the industry well) would have gone through the same thought process with the same lingering doubts.
We were able to manage the situation as we always work with a great degree of transparency and collaboration to ensure we are all sitting on the same side of the table.
Supply chain realities are harsh. Things hardly ever go to plan in complex supply chains, where human errors, loss and theft issues are just the beginning of day-to-day challenges.
That makes assessing and implementing supply chain IoT solutions a compelling option.
What the IoT does, as the Internet of Truth, is to enable accountability throughout the supply chain. And this enables control over your supply chain. Trust is good, control is better, and you can’t control what you can’t track. It’s actually that simple.
Is the Internet of Truth reserved for large organisations operating global supply chains, or can smaller organisations now consider IoT options?
The choice of the right supply chain IoT solution isn’t trivial. IoT solutions don’t come out of the box, one size never fits all.
Proven IoT specific technologies and infrastructure, like the global 0G Network we own and operate in Australia and New Zealand, powered by Sigfox technology, are the game changers which reduce connectivity costs and achieve operational viability over many years. Our 0G Network is a low-power, long range wide area network (LPWAN) which offers an alternative to traditional 3/4/5G networks which deliver more bandwidth, but come at a higher cost and shorter device battery lifespans.
Here are some key considerations for supply chain operations when considering any IoT solution:
- What is the business problem you are trying to solve and what is the data you need to gain the insight you need?
- What operational requirements do you have to make a solution viable for the long term? Have you considered the deployment process when it comes to installation of devices and they operating conditions they will be exposed to?
- What are the technology requirements across the device, network and data platform to get the right end-to-end solution? Can you be certain about the longevity of the solution once deployed and operational over many years?
- Ultimately, does the business case stack up, is it financially viable in the short-term and long-term? Is the total cost of data production lower than the total value you want to realise?
The questions are not always obvious. The answers are not easy and have to go into a great deal of detail to arrive at a robust business case that will actually have the anticipated value.
The application of an IoT-specific methodology, input and guidance from experts with hands-on experience helps greatly to mitigate risks and speed up timeframes.
The supply chain industry can now harness the advantages of mature IoT solutions at scale and across the world to deliver new resilience, control and flexibility in logistics operations.
Transparency needs to sit at the heart of any such IoT solution, but it must solve a specific business problem, deliver a defined long term ROI and it must deliver more customer value as a result.
To make an IoT project real in the supply chain requires new thinking about what data we collect, how we collect it and how we use the data to gain valuable insights.