Internet of Things in the supply chain

“Internet of Things” or “Internet of Things” is a term that is talked about very often these days, but what exactly is it? how and why will it revolutionize our lives and supply chains?

Internet of Things means connecting physical objects (things) equipped with sensors and actuators to the Internet, so that information from the environment can be collected and interact with it, sending said information to the Internet where cloud services can analyze it and make decisions. . In English it is called “Internet of Things” and is abbreviated as “IoT”.

If the Internet that we all use daily has focused until a few years ago on connecting only computers, and later smartphones and tablets, the trend is that over the next few years most objects will be connected: heating systems, systems led lighting, traffic lights, parking spaces, street lamps, vehicles, biomedical devices, etc. “Things” is a very generic word, precisely because anything can be connected. In the supply chain, when technology allows the Internet of Things to reach its full potential, we will see each forklift, each pallet, each box of merchandise, each slot in the metal racks, etc. connected. Machinery, factories and warehouses will be smart and will be able to connect with each other. IoT will be the main ingredient in industry 4.0 and logistics 4.0.

Conceptually, connected objects are IoT devices and they work in a loop of value creation through information:

1. An IoT device collects information from its physical environment through sensors (temperature, humidity, location, acceleration, …)
2. The information obtained is sent through data networks to the Internet.
3. The information is received and stored by software services in the cloud.
4. The information is combined with that obtained from other IoT devices and other data sources, processed and analyzed through massive data management systems or Big Data.
5. Artificial intelligence or machine learning software will use the information analyzed to make decisions without the need for human intervention. That is, the system will work as an “augmented intelligence”.
6. Based on the decisions made, instructions are sent to the IoT device.
7. The IoT device receives the instructions and, following them, will interact with its physical environment through actuators.
8. The process returns to the first point and repeats itself in a loop.

The concept of an Internet of connected physical objects was already used in the 1980s, but the term “Internet of Things” would not begin to become popular until 1999, when the Auto-ID Center of the Massachusetts Institute of Technology (MIT) established that the automatic identification through RFID it would be an essential requirement for the Internet of Things, according to his perspective of almost twenty years ago. The term “Internet of Things” is often associated with Kevin Ashton, one of the founders of the Auto-ID Center who initiated a project to establish a global open standard to aid the widespread adoption of RFID.

The Internet of Everything, abbreviated IoE, is spoken of as a term that broadens the Internet of Things concept. It is sometimes said that the Internet of Things (IoT) focuses on connecting objects, or what is called machine-to-machine connectivity (Machine-to-Machine or M2M for short). In the Internet of Everything, on the other hand, this connectivity is expanded and the machine-to-person connection (in English “machine-to-person” or M2P) and person-to-person connectivity (in English “person-to-person” or P2P).

The health sector is a typical case of M2P connectivity, where sensors can obtain information about blood pressure, glucose levels, heart rate, etc. Some of these sensors are inserted subcutaneously and are able to communicate wirelessly with a handheld terminal for motorization in real time. This information could be sent via the Internet to the hospital center and thus have patient monitoring systems that are much more precise, comfortable and at a lower cost.

It must be borne in mind that, despite how much there is currently talk about the Internet of Things, it is a technological revolution that still has a long way to go and, therefore, some concepts are still somewhat ambiguous or are promoted by technology manufacturers as part of their marketing strategies in order to try to occupy an advantageous position in the market. This is one of the reasons why people sometimes try to reduce the term Internet of Things to accompany it with other terms, when the Internet of Things, as a concept, is already broad enough if, in addition to giving importance to things (the “Things ” of the name), we give the importance it deserves to information and digital intelligence to process it (the “Internet” of the name). So, depending on your preference, you can also think of the Internet of Everything simply as a synonym for the Internet of Things.

That being said, when talking about the Internet of Everything, the Internet of Things is often considered to be a part of it. The IoT concept is then posed as centered on physical objects, which can collect information from their environment through sensors and without human intervention. The Internet of Everything is intended to emphasize the combination of connected things (which will generally not require human intervention) with human-generated information and the intelligent software systems that drive it all.

The truth is that the idea of ​​having everything connected to the Internet is not new, but just a few years ago it was practically impossible to think of a real adoption of IoT. There are a number of technologies that play a key role, including wireless communications (Wi-Fi, Bluetooth, 4G, etc.) and automatic identification systems such as RFID and NFC.

Mass adoption of the Internet of Things is still hampered by limitations in such technologies, one of the most important constraints being power consumption and battery life. Hence, new technologies or variants of the existing ones focused on consuming as little as possible have been emerging and are gaining prominence in their use in the Internet of Things, even at the cost of reducing the speed of data transmission, such as Wi -Fi HaLow, Bluetooth low energy or BLE, ZigBee, etc.

Sensors are essential in the IoT concept. The mobile you are holding already has several sensors: brightness, proximity, accelerometer, GPS, pedometer, fingerprint detector, etc. Consider that, today, many of these sensors can be mass-produced at a cost of just a few cents per unit, and that to the list we must add temperature, humidity, infrared, pressure, force, acoustic sensors, motion detectors, chemicals etc

Miniaturization has undoubtedly contributed to the idea of ​​being able to have smart objects with the ability to connect to the Internet. Some of the major manufacturers of microprocessors have already announced systems that have the functionality of a complete computer in the size of a coin, designed specifically for use in the Internet of Things.

The potential of the Internet of Things lies not only in the connectivity itself, but in managing all the information that is generated from the connected objects, which collect information from the physical world through their sensors. We are talking about billions (with b) of objects will generate information that must be stored, processed and analyzed. Currently, there are already hardware and software systems that allow handling immense amounts of data, which is called Big Data or massive data. This large amount of analyzed information can then be used by artificial intelligence or Machine Learning software that allows computers to “learn” ways to proceed, make decisions and make predictions, without being previously programmed specifically for each situation.

All of the above means that we can already have objects that obtain information from their physical environment, send that information over the Internet to any part of the world in a matter of milliseconds, where it will be combined with information from other connected objects and analyzed by sophisticated information systems. software, to finally receive instructions also from the internet and through actuators to interact with the physical world. And all this, without the need for human intervention during the process. This is what makes so much talk about the possibilities of the Internet of Things: smart parking, traffic control, logistics fleet control, smart intralogistics management, smart agriculture, remote medical monitoring, energy efficiency with smart grids, etc.

As has happened time and time again with the introduction of technologies in the market, at first the manufacturers of these technologies will try to provide their own variant, in order to occupy a privileged position with respect to their competitors. But connecting objects to data networks and supported by software systems implies that things must be able to understand each other in one way or another. The creation of standards and their widespread adoption will be essential for a truly successful Internet of Things.

This is not new. Before Wi-Fi networks were standardized and began to become popular in 1999, wireless data connections were already used in warehouses. But these technologies were proprietary to each manufacturer and were limited to the uses and devices that each manufacturer had designed. The popularization of Wi-Fi allowed a greater offer of devices, greater flexibility in how to use them and the reduction of costs.

It is not surprising that the origin of the term “Internet of Things” is associated precisely with an initiative to create a standard. The Auto-ID Labs, formerly the MIT Auto-ID Center, with the participation of universities from several continents, is responsible for maintaining the standard that determines how information should be stored in RFID tags.

Auto-ID Labs have also defined the EPC standard, or Electronic Product Code, which is essential in the Internet of Things, and which specifies how to assign a unique identifier to each object. Let’s think that until now we are used to objects carrying barcodes, but this only identifies the model of a product and all the units of that model will carry the same barcode. The EPC will allow each unit to be identified independently. This identifier can be stored in two-dimensional barcodes, RFID tags, NFC tags or through future identification technologies.

On the other hand, the Internet of Things Global Standards Initiative, abbreviated IoT-GSI, maintained a project to promote the development of technological standards for the Internet of Things. In July 2015, its activities were transferred to a new study group, the Study Group 20, incorporating aspects related to smart cities and communities.

When talking about the Internet of Things, it is common to hear the expression “make the invisible visible”. By equipping objects with sensors that can collect information from their environment and transmit it through a data network, it is possible to make information visible that would not be possible without IoT.

For example, in a connected warehouse, forklifts could incorporate location sensors, load sensors, accelerometers, etc. This would make it possible to obtain information on the real routes that the forklifts make, the times required for each maneuver, the manner and safety with which each maneuver is carried out, etc. And all this in real time. If we take this idea of ​​incorporating sensors to each pallet, each box of merchandise and each hand terminal of warehouse operators, and throughout the entire supply chain, then the visibility It will be the great revolution that the Internet of Things will bring to supply chains.

Traditionally, supply chain managers have to collect statistical data and analyze it after the fact to detect problems and propose optimizations. The vast increase in real-time visibility that the Internet of Things will provide will enable better, faster decision-making. This will help to more efficiently apply management methodologies such as Six Sigma and will facilitate the identification of waste in Lean supply chains.

The Internet of Things will revolutionize the way in which the supply chain is managed. As technologies evolve, overcome current limitations and reduce costs, it is foreseeable that all merchandise will be identified by RFID. In the case of perishable items, they will incorporate active RFID that allows the addition of sensors to detect changes in temperature, humidity, etc., so that the conditions through which the merchandise has gone through in each phase of transport will be recorded. Thus, it will be possible to detect when the merchandise deteriorates without waiting for it to continue down the supply chain, reducing reverse logistics costs and customer dissatisfaction.

The advantage of RFID over barcodes is that, as it is a radio frequency identification, the label does not need to be visible, so the information can be read without having to unpack the merchandise. Thus, when a pallet enters the warehouse reception area, all the RFID tags of the products contained on the pallet would be read without the need for pauses, maintaining inventory control automatically in real time. In addition, information such as expiration dates, serial numbers, if the cold chain has been broken, etc. would be provided.

The reception area could also have cameras connected to the Internet of Things and, using image recognition software, detect possible defects. The pallets would be equipped with sensors that automatically detect the weight of the load, whether it is balanced and exactly what merchandise they are carrying.

Forklift trucks, also connected to the Internet of Things, could have sensors that help transport cargo more safely and predict possible breakdowns, notifying maintenance before they occur. In addition, they could be guided to the most appropriate slot on the metal racks. The trucks could automatically control the speed based on their load and upon detection of obstacles, and through location systems coordinate with other trucks.

We can think that the slots in the metal racks will also have sensors, so that they can detect the merchandise they contain. In this way, inventory control would be maintained in real time at all times and all merchandise would be connected to Big Data and Machine Learning software to optimize slotting through augmented intelligence. Here it is important to think beyond automations. The potential of IoT is the analysis and use of all the information that is generated. In this way, different sources of information could be combined to, for example, automatically organize slotting taking into account if there is going to be a peak sales day (Mother’s Day, Black Friday, Valentine’s Day, etc.), analyze Data such as activity on social networks to anticipate which products could be in greater demand, or weather information on transport routes in anticipation of possible supply difficulties, which could also create purchase orders for suppliers.

Real-time inventory control will facilitate the adoption of pull systems over push systems and, therefore, efficient just-in-time logistics.

Energy savings will be another advantage of IoT. If we talked a long time ago about the benefits of LED lighting in warehouses, let’s think that this lighting will incorporate sensors for presence, ambient light, etc., to adjust lighting levels to what is really necessary in each part of the warehouse, minimizing consumption. . But the lighting system could also be used as an infrastructure to provide it with sensors that provide additional information such as humidity, temperature, etc.

All of the above are just a few examples. In the coming years we will see countless ways to apply IoT in the supply chain. We must emphasize that the great potential of the Internet of Things is not simply automation. The fact of being able to collect much more information on everything that happens and being able to analyze this information with Big Data software and feed it to artificial intelligence systems will allow us to propose ways of managing the supply chain that were previously unthinkable.

But it’s important not to fall into the trap of technology becoming an end in itself. Following the Lean Thinking philosophy, the important thing is to create value for the client. With so much information being generated by IoT devices, it is easy for such information to end up being wasted. It must be analyzed and used in a way that helps make decisions to manage the supply chain more efficiently and, therefore, create value for customers.

To apply the Internet of Things in warehouses, it is necessary to be able to interact between the physical, that is, the merchandise stored, and the digital (stock control, order management, etc.). To do this, metal racks must be combined with automation systems. Automatic warehouses with stacker cranes and automatic order preparation systems designed and manufactured by ATOX Storage Systems are some of the systems that can play the “physical” role in the Internet of Things.

ATOX Soluciones Tecnológicas smart roller conveyors are modular and energy efficient. Thanks to its versatility, it can integrate a wide variety of sensors and adapt to the present and future needs of warehouses. Roller transport plays the role of “acting physically” moving the merchandise inside the warehouse, automatically classifying the merchandise acting as a sorter, and minimizing the need for operators to travel.

There is a lot of media buzz around the Internet of Things right now, mostly due to the marketing strategies of technology manufacturers and software service providers. This is partly to try to get ahead of the competition and partly to try to artificially speed up demand creation, especially in the consumer market. But the truth is that there are still several technological hurdles to solve before IoT can be widely adopted.

Statistics indicate that companies tend to be conservative when it comes to incorporating the latest technologies. This makes complete sense if we think that the Internet of Things is still in its infancy, and technology manufacturers will introduce their technologies to the market to try to position themselves in an advantageous way, but in the end, some of these technologies will not be widely used and will end up in disuse while others will be imposed. Companies cannot assume the risk of making large investments in technologies that are not guaranteed to be part of the prevailing ones.

One of the main limitations is that wireless devices consume too much power, and when it comes to miniaturization, current battery technologies only provide very limited capacity, with considerable size and weight.

Another major obstacle facing IoT is security. If we think that all things are connected, a vulnerability in the system would allow hackers not only to steal information, but also to control physical objects. The consequences of this would be so serious that security will be one of the great barriers that the Internet of Things will have to face.

Let us remember that when Wi-Fi networks became popular in the early 2000s, the security of the first versions of the standard turned out to be easily violated, and we had to wait until later versions to have more acceptable security levels.

In addition to security, privacy must be taken into account. Even in situations where there are no security breaches, the fact that most objects are connected to the Internet generating information means that we will be providing much more information than we would like to share: when, how and where we use all the objects.

Security and privacy have such important implications that it will be something that will have to be dealt with technologically, administratively and socially.

There is no doubt that the potential of the Internet of Things is so great that it will revolutionize most sectors and logistics will be one of those that will benefit the most. In addition, it will give rise to new business opportunities that we may not have realized yet. But IoT adoption will be slower than is being claimed. Some more sensible estimates indicate that it will still take at least a decade for the Internet of Things to mature enough to start reaching its full potential. Most likely, the Internet of Things will be introduced so progressively in the industry, in logistics and in our lives that we are not fully aware of the great leap that we will be witnessing.

If we think further into the future, self-driving vehicles, both for goods and passengers, will become popular in the coming decades, and their Internet connection will be part of their conception. Machinery in factories will be further automated and controlled by artificial intelligence, reducing the need for human intervention. Augmented intelligence software systems will evolve remarkably and will increasingly have more real-world information from which to “learn”.

The Internet, and the digital revolution that it has brought, has been one of the main advances of the 20th century. In the 21st century, it will be the union of the physical and the digital with the Internet of Things.