Supply chain management has become a complex and demanding profession in its own right. Fortunately, technology is evolving to help supply chain managers meet these often-conflicting needs.
In this article, we have mentioned 5 ways how the Internet of Things is transforming supply chain management as we know it.
1) Creating True Transparency
The Internet of Things is providing greater transparency to all levels of the supply chain. RFID tags and sensors are increasingly used to monitor the temperature, humidity, and other factors of perishable items, whether they are medications or ripening fruit.
Then you can make informed decisions before you run short since you can estimate when goods will hit the warehouse even as orders are coming in. This process has the side benefit of strengthening accountability. Quality control improves, as does product forecasting.
More transparency also means fewer chances for counterfeiting. By being able to follow a certain product at every single stage in the supply chain ensures its provenance, and could be a game-changer in industries like high-end fashion, or jewelry for instance.
2) Gaining Greater Customer Knowledge
RFID tags plus closed-circuit TV cameras are not just there to deter theft but also useful to track customer behavior. It tells you how they navigate around the store and how many items they put in the cart. You can see how they react to endcap displays and sales. This allows companies to implement dynamic pricing and even user-specific deals.
It also provides information on how they could better arrange stock to improve sales. For example, RFID sensors can tell how people picked up an item, and how often people picked it up but decided not to buy it.
3) Reduced Labor Requirements
Retailers have traditionally relied on huge warehouses to stock goods. However, they can’t afford to maintain massive warehouses when technology may allow them to reduce inventory levels without hurting delivery metrics.
But with IoT, employees know exactly where to go to find the item they need and also locate the misplaced items and put them back. In some cases, IoT can give employees the shortest, fastest route necessary to fill their order, saving everyone’s time. Few warehouses are already setting up self-driving carts that can replace most of their staff.
4) Enabling Mass Customization
The IoT is key in delivering mass customization at a reasonable price. For example, the system can offer unique, exclusive, and personalized ads and discounts to customers. The IoT can also help staff locate and assemble items to create the customized final product the customer has requested.
This is a growing area that businesses need to learn how to serve, and supply chain managers who have a great understanding of how to use these new tools will be needed. Schools are listening too.
5) Improved Performance of Assets
The health of machinery is vital for any supply chain, and equipment that is down will eventually lead to delays and inefficiencies. Manufacturing units are already using IoT technologies to track production system performance and predict when equipment needs maintenance.
Retailers can also use IoT technology to track their fleets in transit and determine when they need to repair a truck before it is stranded on the side of the road. This allows you to schedule maintenance and prevent costly unplanned failures.
The Internet of Things is affecting app development and the power grid. However, the greatest impact is on the flow of products from the shop to the retail floor to the customer’s door.