Considering the complexities of supply chain and business dependency on transportation, an efficient logistics industry will help shave off enormous expenses from other sectors linked to it. It would not be wrong to say that the health of the logistics industry has a huge bearing on the GDP of the country, given that logistics account for 14% of India?s GDP.
Gartner says IoT will completely change the world of delivery operations and that a thirty-fold increase in Internet-connected physical devices by the year 2020 will significantly alter how the supply chain works. (Post-COVID, the growth of pace of connected devices may have slowed but there is no doubt about the trend).
Traditionally, logistics has deployed technology at the backend to manage operations including warehousing, distribution and fleet management. But the advent of IoT-enablement has brought goods and shipments under the ambit of technology to plan, monitor, track and expedite delivery with interventions.
So much so that a report by IDC and SAP predicts IoT will enable up to 15% increase in productivity facilitating delivery and supply chain performance. Industry leaders, such DHL and FedEx are already embracing IoT in a big way. FedEx in-house asset tracking system, SenseAware, is an industry-leading platform which is being used by many large corporations for a variety of use cases.
In a recent survey of 800 supply chain leaders conducted by DHL, 60% of respondents stated that visibility of their supply chain is currently inadequate and 75% of respondents reported they intend to implement at least one next-generation wireless technology in the near future to achieve their visibility goals.
Adding insights to the DHL research, Markus K?ckelhaus, Vice President – Innovation & Trend Research, DHL Customer Solutions & Innovation, said ?Logistics will be both a major beneficiary of the IoT-enabled digital revolution and an enabler. Although some parts of the logistics industry are already smart and connected, next-generation wireless is set to usher in the next wave of IoT in logistics.?
Getting visibility into transported goods is an important operational metrics for the industry as performance and profitability are closely linked with speedy fulfilment of delivery. This is where IoT-enablement becomes a game changer to enable differentiated services with close monitoring and active intervention by the service provider to fulfil customer objectives.
For example, shipments which comprise perishable or fragile goods need to be transported under a specific set of conditions to maintain quality and integrity. Tracking such assets with IoT-based tagging enable to monitor conditions such as humidity and temperature in the storage area; or the shocks and vibrations experienced during the transit. Consider the burden of the pharmaceuticals industry which loses an estimated USD 15 billion annually due to damage caused by products not stored in optimum temperature and 1.5% of overall pharmaceuticals products that are damaged in transit.
Continuous updates on assets are therefore critical inputs that help operations to live up to customer SLAs and take preventive or corrective measures as required. If any damage is detected during the transport of shipment, the customer can be informed immediately to make arrangements for another shipment that will help minimize the delay and loss.
Logistics service providers need tremendous efficiency in systems and processes to optimize fleet and warehousing utilization while meeting customer SLAs on deliverables. This means the internal systems must operate like a well-oiled machine which can deliver under any circumstances even while tackling external variables, such as inclement weather, road blockages, airline strikes, etc. for which IoT adoption is an imperative.
Going forward, four key areas in which IoT will have widespread impact for the logistics industry include:
- Increased Visibility: Every shipment, asset, infrastructure, and facility will be connected thanks to widely available networks and inexpensive high-performance sensors. This will usher in increased automation, process improvement, and transparent incident resolution to facilitate enhanced quality of service quality to B2B and B2C customers.
- Wide-scale Autonomy: All autonomous vehicles, whether indoor robots or logistics vehicles on public roads, rely on ultra-fast, reliable wireless communication to navigate and traverse their worlds effectively. Next-generation wireless solutions will be a key enabler driving their widespread adoption and moving the world to autonomous supply chains.
- Accurate Prediction: The volume, velocity, and variety of data due to connected devices, the progress of Machine Learning systems and Artificial Intelligence paired with ultra-low latency of next-generation wireless means data-driven prediction systems for forecasting, delivery timing and routing will become increasingly more accurate.
- Theft Prevention: Plenty of innovation is already on the horizon with connected hardware, fleet management and asset tracking enabling logistics providers to plug a lot of revenue leakage due to theft during transit and at warehouses. Busines managers will be able to find effective IoT solutions that provide increased visibility into supply chain, prevent scams, tampering and thefts.