The Internet of Things in Supply Chain and Logistics
As supply chains are strained under competition, technology is proving to be a valuable differentiator and competitive advantage. In a recent study, that rationale emerged as the main driver for companies to invest in real-time monitoring or data collection through the Internet of Things.
That study, released by eft, polled 600 supply chain decision-makers to learn about their plans for leveraging IoT within their operations. The study is a follow-on to an earlier report issued in 2014.
Supply chain partners are also looking to be more and more connected to the whole ecosystem, meaning they are increasingly demanding more data from suppliers and providers alike, the study concluded.
IoT technology investments have taken off between 2014 and 2016, with the number of respondents using a variety of technologies having increased. Five percent more were using GPS and satellite technology, data logger technology increased by 14 percent, while IoT sensor and monitoring technology increased 19 percent.
A large majority—80 percent—of those studied are are looking for IoT solutions for land shipments, followed by 50 percent for air and 33 percent for ocean shipping. “Given the number of variables of land shipments, it’s not surprising to see it as the area of most need,” the study concluded.
A majority of IoT network users—59 percent—said they were using the technology for alarms and real-time monitoring rather than for optimization and prediction. Alarms and real-time monitoring often serves as the entry-level application of IoT, the report suggested.
“As an organization’s IoT strategy evolves, optimization and prediction play a greater role,” said the report.
Improving customer service with better information was cited as the main driver for further deployment of IoT.
Between 2014 and 2016 IoT jumps into the lead as the go-to technology for operational visibility. The reported noted a shift in preference towards IoT and away from some traditional visibility tools, such as bar codes and RFID. “This trend is only going to be further entrenched as companies continue to see ROI from their IoT investments,” the report said.
The majority of respondents—69 percent—say they expect to see return on investment in the next 24 months. However, the report noted thata growing contingent believe they will see an ROI in the first 12 to 18 months as ROI has accelerated over the last two years.