Supply Chain Commentary: Taking the First Steps to Digitizing Your Supply Chain

The clarion call to digitize the supply chain is louder than ever before. In order to meet consumer demands and gain competitive advantage, shippers are retooling their supply chains to be more agile, efficient, and transparent. But where do you start? What steps can you take today? And how can you use existing IoT analytics to benefit the supply chain?

The benefits of digitizing—or starting to digitize—your supply chain are many. Chief among them is visibility. Whether you’re sending out goods or awaiting delivery, what you don’t know about your cargo can hurt your business. According to the 2017 Supply Chain Worldwide Study, 77 percent of firms have zero or restricted visibility into their supply chain.

Here are three initial steps you can take to start digitizing your supply chain today.

Step 1: Identify Trouble Spots

An essential first step is to inject visibility technology into your supply system—but not all at once.

Instead, start by identifying glitches in your supply chain and inject visibility at these points. This could be a problem route, where goods go astray or are consistently delayed. It could be a problem customer, who consistently complains about an issue like compromised pharmaceuticals, where you have no visibility. Or it could be a problem SKU, such as 60-inch TV sets that consistently reach their destination damaged.

Incumbent technologies for tracking inventory and shipments lack the high-level location-based intelligence into physical goods and assets that’s needed to run today’s dynamic supply chains. I’m referring to RFID, barcode scanning, GPS, and other geolocation services. The data that these technologies provide is not sophisticated enough to meet the demands of a dynamic global enterprise.

While RFID tags are still good for simple check-in/check-out logistics, Bluetooth-enabled IoT sensors allow for parcel-level, global tracking and condition-monitoring of goods in transit by ground, sea, or air, or assets or equipment in the field. In addition to current location, IoT sensors can report on temperature, humidity, ambient light, air pressure (altitude), shock, tampering, and VOC gas. They can alert users to delays including changes in ETA, motion including non-permitted movement, tampering, GPS jamming, deviation from assigned routes, and crossing of waypoints.

Step 2: Fix Problems

Monitoring services provide full visibility into the enterprise ecosystem so that you can hone in and fix problems related to a particular shipment, such as inbound raw materials or outbound finished goods or inventory in a warehouse. While at the start, this may feel like a point solution, it quickly transforms into a value solution providing full visibility into global enterprise – even monitoring assets in the field, from vehicles to heavy-duty or high-value equipment and machinery.

For example, shipment-monitoring services can provide shippers with real-time data on cargo transported by market vehicles and pattern analysis of that data so theft and delays could be reduced. A cloud-based app can send alerts in case of route deviations, unexpected stops, or delays, and an audit trail can be generated at the end of every shipment to be filed with that order for reference. As a result, pilferage can be completely eliminated.

Bottom line: Actionable data from IoT sensors allows managers to make better-informed decisions and to proactively manage their supply chains—so that that ice cream shipment doesn’t melt in-transit, prescription medications don’t arrive too late, and those TVs are not damaged.

Step 3: Realize Data Efficiencies

IoT isn’t just about gathering data; it’s about using it to make better decisions. So, once you have a handle on your most pressing problems, then you can scale to the entirety of your routes, customers, and/or SKUs.

With the data you’ll collect through digitization, you can use existing IoT analytics and machine learning to find ways to save time and resources everywhere, as well as to proactively avoid risks and generate predictive ETAs, such as when a truck is likely to arrive late at a distribution center.

Customers looking to begin to digitalize their supply chain should opt for solutions that offer a powerful analytics platform with predictive modeling, pattern analysis, and heat maps, among other tools. By analyzing data on past shipments to predict future events, enterprises can gain supply chain efficiencies that result in immediate ROI.

Today, customer expectations are forcing the ”now economy” and the digitalization of the entire supply chain. Following these three steps will help you meet these expectations, while transforming your supply chain from a cost center into a strategic growth engine.

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