The real value of IoT in supply chains

Samuel Morse was a 41-year-old artist when he overheard two men talking about new discoveries in electric magnetic technology aboard a ship sailing between Europe and America in 1832. His subsequent fascination with this technology would lead to the invention of the single-wire electric telegraph – widely considered the world’s first interconnected device. It was a groundbreaking discovery and the catalyst for a revolution in machine communication. 

It would be an understatement to say that a lot has changed since then. Today, almost 200 years later, we live in a connected world. We can send or receive any kind of message, or any piece of information, from the palm of our hand. Connectivity is so prevalent it’s taken for granted.  

That’s not the case in many of today’s supply chains, although it should be. For some two decades, the business world has been discussing the benefits of an Internet of Things (IoT) – a network of automated smart-enabled devices communicating with one another without manual (human) input. We’ve been asking ourselves how we can merge informational and operational technology to improve all kinds of industrial, manufacturing, and – yes – logistics processes.

Here’s the thing: we already use IoT to improve transport and logistics. But many people – including corporate supply chain managers – aren’t aware of just how established IoT technology is. And that means they’re not taking advantage of it.

IoT – a (very) brief history

We have come a long way from the first telegraph machines of the 1830s. The internet was born in the same year that Neil Armstrong first stepped on to the moon’s surface and famously declared “one giant leap for mankind.” On October 29, 1969, NASA’s ARPAnet (considered the first workable internet prototype) sent its first message: a “node-to-node” communication from one computer to another.

It took over a decade before the first truly automated IoT device was invented. In the 1980s, university students connected a campus vending machine to a remote network using microchips to keep track of whether the machine was full or if the cans were cold. 

Nowadays, more than a few leaps and cans of soda later, machines and humans are more connected than ever. 

There is no shortage of examples of how IoT already impacts our lives, but a smart heart rate monitor is a good example. This connected device continuously feeds your current pulse to an app on your phone. It can also transmit data to an external network. While athletes use them to track their fitness levels, doctors can monitor their patients’ health. 

The amount of data collected from IoT devices today is mind-boggling. In 2020, it reached 44 zettabytes (44 trillion gigabytes) – and it’s doubling every two years. 

IoT in supply chains today

Five years ago, the Internet of Things was a satellite, low-impact trend on the Logistics Trend Radar – a development to keep an eye on. Well, that’s precisely what we’ve been doing, not to mention integrating the latest innovations, such as the SmartSensor, into supply chains. Today, IoT has an enormous impact on logistics, providing unprecedented transparency, and transforming what we can achieve. 

But it doesn’t stop there. In fact, this is where IoT comes into real play. Now that we know where everything is and what condition it’s in, we can use the latest applications and analytics solutions to create insights into the future – predicting what could happen next and prescribing possible next steps. In other words, IoT delivers the resilience everyone has been talking about in recent years. 

What’s more, the price of this technology continues to drop. IoT devices have always been relatively affordable, but the latest innovations are bringing the price point down further. They are getting smaller and using energy harvesting or new battery chemistries, such as zinc-polymer rather than lithium-ion. This means we can now get excellent device lifetime, high functionality, and a low price – a normally unattainable triangle. 

IoT technologies are not only getting smaller and smaller but also offering global connectivity. Technologies like low-power global area networks (LPGANs) utilize low-earth orbiting satellites (LEOS) to connect remote areas of the world that were previously black holes in the supply chain.

As you’ve undoubtedly noticed over the past couple of years, supply chains are highly volatile. This makes supply chain visibility more vital than ever, regardless of whether goods travel by air, ocean, road, or rail. IoT provides that visibility, which allows you to monitor the location and condition of items across your supply chain but take preemptive, actionable steps to ensure things arrive on time and where they need to be, no matter what is happening across the supply chain. 

Shipment monitoring for security and loss prevention

Today’s shipment monitoring goes well beyond simple track and trace. IoT is becoming a key enabler for security and loss prevention in logistics and supply chains. We can now monitor items as they move around a warehouse or distribution center as well as across the entire supply chain. When everything is networked and online, we can observe a shipment from the moment it is picked up to the moment it reaches its final destination. 

Devices using GPS technology have been around for a long time, but it’s only recently that they have the capabilities to add real value to logistics. Small sizes, long battery lives, and strong signal strengths have made them a perfect solution for quality control and loss prevention in small package shipping. Today’s devices come in all shapes and sizes and can detect temperature, humidity, light, vibrations, etc. 

For example, using a light detector, we can tell if unwanted light is inside a package. This indicates that the package may have been damaged or tampered with. 

Today’s devices are so small that people don’t even recognize them or know they’re in there. In the case of theft, IoT devices can support the investigation and help locate the missing goods. 

Next-generation freight stations

IoT is changing the way warehouses and distribution centers operate. Beyond monitoring conditions, both passive and active scanning technologies are revolutionizing how inventory is recorded and located. 

Handheld scanners are slowly becoming obsolete as small golf-cart-sized vehicles travel the aisles, loaded with sensors, reading RFID labels on the freight as they drive by. Forklifts fitted with the same devices can capture locations any time a pallet is moved. And using an overhead dimensioning system, forklift operators merely need to drive through the system to scan the size and shape of their cargo to ensure it fits the intended location. 

Smart labels with RFID chips and innovative uses of IoT are making it all possible. The goal is to make freight intelligent and automate all facets of the supply chain. With IoT, the cargo itself is self-updating the system, giving you immediate visibility. With rules and exceptions to trigger flags and notifications, the possibilities are endless. Lost freight will become a thing of the past. 

Future-proofing supply chains

Logistics companies should no longer be flirting with a future in IoT. Instead, we should be embracing it. From a single, sensitive item express shipped across the Atlantic to global warehouse networks and production supply chains, we must constantly look for new ways to connect the unconnected and maximize transparency. 

The potential of IoT is far from fully tapped. The trend will continue and, in doing so, transform entire supply chains. Whether you have products to ship or are in the shipping business, there has never been a better time to experience the real value of IoT in your supply chain.