From retail to healthcare, IoT will disrupt supply chains by 2020

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Dive Brief:

  • The manufacturing, transportation, energy, retail and healthcare industries are among the five industries most likely to experience a supply chain shift due to the Internet of Things (IoT), Hewlett Packard Enterprise Matter wrote in its latest issue. 
  • Sensors are changing the way these industries do business, with retailers expected to spend $2.5 billion, utilities projected to employ one billion smart meters and manufacturers to make 250 billion cars with connected capabilities by 2020. 
  • The healthcare industry will also begin to see workers wearing uniforms with built-in sensors working side by side with robots and smart sensor beds advising nurses and doctors of patient movements and conditions.

Dive Insight:

How exactly will the IoT affect the supply chain?

The foremost feature of a successful supply chain is its degree of transparency. Imagine a smart sensor attached to a shipment of goods, allowing recipients along the chain to track not only its contents, its shipment date, its temperature (should it be part of the cold chain) but also its accuracy, meaning that corrections or redirection could be managed immediately. Errors can and do happen, but they will happen less and with fewer consequences once a sensor supplies leading details.

Another effect will be specificity. Once the IoT becomes a common feature of big ticket items, supply chains will be tasked with building products based on specific buyer preferences, such as surround sound on a flat screen TV, or a GPS monitor on cross country skis. The supply chain will become more integrated starting with the purchase process, bringing it from behind the scenes to the forefront of production.

The changes may sound futuristic, but IoT adoption is increasingly widespread. From Amazon Go to connected cars and healthcare drones, the supply chains of the future are nearly here. Whether this will cause a shift to more demand-driven chains is yet to be seen, but it is not unlikely.

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