Logistics is a complex discipline, involving the coordination of multiple elements to achieve a specific deliverable. Internet of things (IoT) technologies offer innovative answers to numerous logistical challenges, and are currently being adopted more widely across the industry.
The logistics business today faces a raft of challenges, including the need for more efficient asset management; increased e-commerce activity spurred by the COVID-19 pandemic and expansion of remote workforces; a call for more relevant information to meet customer expectations, including enhanced package tracking and delivery notification; integrating digital technologies with legacy processes, and staying competitive with market rivals.
IoT defines a broad category of technologies and devices. Areas of relevance to logistics include:
- Sensors for asset tracking and management. They can be used for purposes such as ensuring that temperatures on shipments of delicate cargo don’t exceed set thresholds.
- Wireless technologies for communication and transfer of data from sensors.
- Artificial intelligence and edge computing, working in combination to acquire and analyze data at the source, and minimize the latency associated with transmitting data across a network.
IoT technology has dramatically changed many aspects of the logistics industry for the better. Companies that have adopted such applications are well-positioned to take advantage of market opportunities. Data collection and tracking capabilities provide enhanced visibility into assets such as vehicle location and cargo condition. The understanding gained by better visibility leads to improved decision-making and increased security. And real-time notifications of missing or stolen assets can be addressed promptly to minimize financial losses.
Real and imagined impediments often get in the way of industries adopting new technologies. That’s especially the case when applying IoT to the logistics industry.
Companies continue to use traditional methods to run their businesses, and are unsure of how to effectively take advantage of IoT technology. They lack understanding of the current state of the market, let alone changes facing the industry in the coming decade. In addition, there are cost concerns relating to the capital expenditures necessary to implement IoT technology. Sensors, edge computers, and IoT software can be expensive and hard to justify without clearly defined business objectives.
New technologies can be intimidating and demand a rethinking of business processes, as well as require additional training for employees. This could influence some companies to stay with the status quo.
Resources required to implement IoT technology include sensors, which can cost several hundred dollars each and are needed in large quantities; edge computers for data collection and analytics; tablets and other handheld devices for employee use, and cameras and security equipment for protecting against fraud and theft.
Yet the benefits of adopting IoT technology are many, including increased operational efficiency, improved management of employees and assets, and greater customer satisfaction, resulting in both new and repeat business.
As IoT technology matures, it will gain more traction in the logistics industry. The benefits far outweigh the difficulties of implementation. As they mature, the components of logistics-focused IoT technologies will become commodified and made available to organizations as a platform-as-a-service (PaaS) offering.
Once that’s accomplished, business owners of all sizes can begin reaping the benefits of IoT technology simply by engaging with the platform. Logistics companies will find it increasingly easy to adopt IoT technology as they strive to grow their businesses.
Jasper Hsu is manager of logistics product management at Advantech.