May 2018 | Commentary | IT Matters: Logistics & Supply Chain Technology

Can You Handle the IoT Big Data Onslaught?

Tags: Logistics, Technology , Supply Chain

Jim Hayden is Chief Technical Officer, Savi, 571-227-7950

Supply chain managers (SCMs) recognize the potential benefits of big data platforms, leveraged and fed by the Internet of Things (IoT). Yet, the combination of IoT and real-time data collection creates an overwhelming data flow, threatening to drown organizations unprepared for the influx of that data. Companies need to understand their analytical goals and underlying architecture in order to find the appropriate IoT platform or other solution.

Millions of data points from a manufacturing and logistics operation allow for predictions about future performance. Precise predictive shipment ETAs are a potent tool for SCMs. Accurate predictions confidently estimate arrival times, lessening the need for slack in many processes and saving money through shortened delivery windows, reduced buffer stock, and more.

Live streaming IoT facts give SCMs an unbiased source of truth. Real-time data allows SCMs to make decisions about disruptions before losing money and time. Consistently meeting service level agreements means higher customer satisfaction and fewer stockouts, creating more agile and efficient supply chains.

However, to take advantage of the influx of supply chain data, SCMs need the architectural assets to collect, manage, and analyze both real-time and historical data. They need to first establish high-quality, real-time data sources. Most organizations still rely on the old electronic data interchange (EDI) format; these data are not real time and are often human-generated and susceptible to error.

By integrating data from already available sources such as enterprise systems, telematics devices, and real-time data feeds, SCMs can establish a stream of accurate, real-time data.

Integrating new real-time data with historical/third-party data is challenging. To tackle integration challenges, SCMs have three choices:

1. Build your own IoT platform. Controlling and customizing features for your unique needs is naturally appealing. The problem is the sheer amount of time, money, and expertise required to build and maintain an IoT platform. You are not likely to have experts in the relevant hardware devices and software components in your company—and that's before considering that the platform has to align with other IT initiatives.

2. Purchase IoT software through your ERP or CRM solution provider. Buying software from a company that is familiar with your business processes makes sense, but their architectures may or may not be able to handle real-time processing of hundreds of millions of daily events or scale to IoT industry volumes.

A semi-functional mix of third-party components often is what ends up in use; however, it frequently can't do the critical work of sharing data with external parties in your global supply chain network.

True visibility requires information sharing and communication between all parties. IoT can create a connected global ecosystem of data producers and consumers, but not if it is a completely closed-end system.

3. Partner with an IoT platform provider. This speedy path to delivering value allows SCMs to focus on the applications instead of the underlying platform. But pay attention to data privacy. Using a third-party broker usually allows organizations to share just the relevant data for more informed decisions without a full integration and its security risks.

Any company can generate insight from the mass of data, no matter what solution they pursue. Big data is leveling the supply chain playing field.

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