Commentary | IT Matters

How to Wirelessly Enable Your Supply Chain

Tags: Logistics I.T., Manufacturing, Technology

Thomas McKay is the Director of Marketing and Communications at Numerex Corp., 949-608-0276

Just in time is challenging enough. It’s even more so when it involves high-value assets such as construction, forestry, and agricultural equipment.

That was the case at one major U.S. manufacturer who supplied those kinds of equipment. For years, the company’s supply chain used specialized containers to shuttle work-in-process inventory between multiple suppliers and manufacturing facilities around the country. Any transport delays would quickly ripple throughout the company and its partners in terms of overtime and other costs. Plus, the company had dissatisfied dealers and customers when the equipment didn’t arrive on time.

Tracking all of those containers was time consuming and labor intensive. This manufacturer already offered its own customers multiple cellular-based solutions for tracking and managing their equipment. As a result, it knew that adding wireless machine-to-machine (M2M) capabilities to its internal tracking would be key for maximizing that system’s efficiency and effectiveness.

By upgrading its supplying chain with M2M, the company wanted to achieve several goals:

  • Minimize the need for additional containers, whose unique designs make them expensive. Those savings increase profitability.
  • Avoid shipments in unauthorized containers, whose standard designs literally weren’t a good fit.
  • That reduces the risk of damage, and the costs and delays that come with it.
  • Allocate resources more efficiently.
  • Reduce operational costs, including by minimizing or eliminating labor-intensive manual tracking of assets.
  • Minimize theft and loss by having visibility into every step of an asset’s journey.

 

Other companies’ experiences shows that all of those goals were achievable. M2M directly benefits a company’s bottom line and competitive position, according to a report by Accenture: “M2M technology can be a vital link between the supply chain and shareholder value, both enhancing net income and increasing the value of assets,” Accenture said. “Fleet tracking, event-based monitoring, field force management, inventory-condition monitoring, asset tagging, preventative maintenance and smart warehouses/supply chain facilities can all help reduce operations costs, while inventory-level monitoring can also lead to higher sales revenues.”

Why an End-to-End M2M Solution is Key

The company chose an end-to-end M2M solution: hardware such as tracking devices for each container, wireless service, and software for tasks such as monitoring assets and performing analytics to identify additional efficiencies. The solution was deployed across the company’s U.S. facilities, as well as those of its vendors, to provide visibility across the entire supply chain.

When companies are choosing an M2M solution, one major consideration is whether to use cellular, satellite, or both. Often the decision comes down to factors such as where their assets are, whether they need uninterrupted connectivity and how much they’re willing to pay for service.

Say a company frequently transports high-value, perishable goods, such as lobsters, often along rural interstates, where cellular coverage is spotty or unavailable for long stretches. That company might be willing to pay a premium to have satellite as the primary or fallback service, because it’s cheaper than losing a load to, say, a refrigerated container that fails while in the middle of a desert interstate. For other companies, cellular service alone is comprehensive enough because of where their assets travel or because brief interruptions in connectivity don’t create problems.

M2M software can be key for automating processes that previously required manual oversight. For example, the solution automatically collects data from all of the tracking devices and then compiles periodic reports. If it detects any abnormalities, such as a delay, the solution automatically sends an alert via email and text message.

It’s cliché to say that knowledge is power, but it’s also true. Manufacturers, fleet owners and other companies worldwide are increasingly using M2M to maximize operational efficiency, minimize loss and theft, and better serve their customers and business partners.

 






Visit Our Sponsors