What is the Internet of Things and How Does it Relate to Supply Chain?

Source: Wikimedia Commons
Source: Wikimedia Commons
We have been seeing a lot of posts these days on the Internet of Things (IoT) from industry professionals in supply chain and logistics. This week we thought we would focus on defining the IoT for those that may be unaware and shed light onto how it applies to the logistics and supply chain industry.

The Internet of Things

The Internet of Things (IoT) is a term that was can be traced as far back as 1832 with the invention of the first electromagnetic telegraph all the way to today. The term itself though, wasn’t coined until 1999 by Kevin Ashton from the Auto ID Centre:

I could be wrong, but I’m fairly sure the phrase “Internet of Things” started life as the title of a presentation I made at Procter & Gamble (P&G) in 1999. Linking the new idea of RFID in P&G’s supply chain to the then-red-hot topic of the Internet was more than just a good way to get executive attention. It summed up an important insight—one that 10 years later, after the Internet of Things has become the title of everything from an article in Scientific American to the name of a European Union conference, is still often misunderstood.
Source:RFID Journal

Postscapes has a great overview of the history of the IoT which can be found here. But to define the IoT:

Internet of Things

Definition: The Internet of things is defined as a proposer development of the Internet where everyday objects (i.e. devices) have a form of network connectivity (e.g. Wifi, Bluetooth, etc.) that allow them to send and receive data.

How Does this Relate to Logistics and Supply Chain?

Logistics Viewpoints recently released a blog post on how the IoT will change the face of supply chain management. Essentially, the theory is that operations along the supply chain can be made more efficient by combining technology like smart sensors, cameras, software, databases, etc. with the Internet in diverse ways to optimize the supply chain.

Currently, the IoT is slotted to be present all along the supply chain, from people who will have badges monitors the health of workers in hazardous environments, smartphone apps that detect traffic conditions, to sensors on cargo/shipments that help supply chain planners direct where goods will flow.

Steve Banker of Logistics Viewpoints emphasizes that in order to properly change and accommodate to the advances in applying IoT elements into logistics requires a change in analytics first:

“Collecting, storing and analyzing IoT data requires different processes, skills and technologies.” Acquiring those technologies and ‘growing’ the associated talent will become a key task for companies that want to use IoT to take their supply chain programs to the next level.
Source:Logistics Viewpoints

That’s it for us this week! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news!

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