September 01, 2014
As mobile devices and wireless functionality continue to penetrate our everyday lives, the same technologies are having considerable impact on the supply chain. Looking specifically at the area that stretches from the dock door to the end delivery point, for example, it’s clear to see that mobile and wireless technologies are helping shippers work smarter, better, and faster in today’s competitive business environment.
Driven by trends like omni-channel retailing, an increasing demand for real-time supply chain visibility, and the technological advancements themselves, the fully mobile supply chain is certainly coming into view.
“We’re seeing substantial progress and significant investments being made in this area,” says David Krebs, president of enterprise mobility and connected devices at VDC Research. And while the concept of using mobility in the environment outside of the warehouse and distribution center (DC) isn’t new, Krebs says it’s becoming more accessible to a wider range of shippers.
“Everyone from large couriers like UPS to smaller, specialty logistics organizations have been investing in mobile devices for proof of delivery, dispatch, and payments for some time now,” he adds. “Now, we’re seeing a lot more interest from a wide range of companies that want to develop massive networks that allow them to sense more activity at multiple nodes within the supply chain.”
Over the next few pages, we’ll round up the latest data and insights into the current state of wireless and mobility in the supply chain, with an emphasis on what’s taking place outside the four walls of the nation’s DCs. Our three leading analysts in this space offer their take on the top technology trends and explain just how close we are to mobile-enabled, real-time visibility—that long sought-after Nirvana of supply chain management.
Coming into sight
With the real-time supply chain within striking distance, Krebs has picked up on an ongoing debate over what type of device, level of ruggedization, operating system, and data collection capabilities will best suit shippers’ needs.
Is it, for instance, enough to equip drivers with smartphones and related tracking/routing applications, or is it wiser to include ruggedized devices whose software is tightly integrated with the shipper’s home base? And, perhaps even more importantly: Do these key elements need to be integrated with each other?
“These are all valid questions that everyone is trying to figure out right now,” says Krebs, who defines mobility as a logistics professional’s ability to collect or access data when and where you need it.
Backend analytics is another piece of the mobility puzzle, Krebs says, as logistics platforms, software, and other components undergo significant modernization and translate into richer solutions for shippers and their customers. “Real-time visibility isn’t just about knowing where an item is in your supply chain,” Krebs explains, “it’s also about getting critical environmental information—such as a temperature readings for items that are on a refrigerated truck—and better managing the chain of custody and avoiding any ‘black holes’ such as security vulnerabilities.”
Krebs admits that such supply chain oversight can be compared to a Big Brother mentality, but adds that in today’s business environment, knowing what’s being delivered and when—and in what condition—are all critical knowledge points for shippers. Using a combination of handheld devices and wireless access, knowing exactly what goes on while products are on the road, on the rails, in the air, or even on the high seas, becomes that much easier.
In terms of the devices themselves, Krebs is seeing shippers use everything from ruggedized handheld devices equipped with top-of-the-line data collection capabilities to smartphone-like devices loaded with applications—and everything in between—to improve supply chain visibility. “Even consumer smartphones, with their integrated camera technology and increasingly powerful platforms are influencing the expectations of what and how a mobile device should operate,” he adds.
Bring your own devices, please
Getting mobile devices into the hands of a logistics operation’s on-the-road workforce is much easier than it was, say, 10 years ago. There’s a good chance that even a small company working on a tight budget already has a team of workers who have purchased one or more smartphones or tablets for personal use.
Knowing this, many employers are instituting more BYOD, “bring your own device” programs, that find drivers and other workers using their own phones and tablets to help connect the dots across the supply chain.
“BYOD is certainly something that comes up in conversation, especially with some of the smaller or mid-sized organizations that are interested in taking the approach with their delivery staffs,” says Krebs. “We’re seeing some experimentation to that effect, as it presents a potential option for some organizations.”
Telematics are also gaining ground and presenting potential for shippers. Defined as the convergence of telecommunications and information processing, telematics have gotten more affordable and are putting more real-time information into shippers’ hands across the supply chain. Clint Reiser, research analyst with ARC Advisory Group, has seen more vendors offering telematics solutions that are more affordable and not as fast as their full-blown cousins that communicate five times to 10 times a second.
“The system may communicate once every couple of minutes, instead of at the high-frequency level,” says Reiser. “These [scaled down] telematics options are less expensive because they can be added as applications to smartphones, which already have built-in GPS.” As a core function, these solutions connect smartphones with onboard computers. And while the cheaper versions may lack the functionality required to track long-haul shipments, they can help add a new level of visibility for local transportation networks.
Hurdling the remaining barriers
In assessing the barriers that remain before all shippers have access to complete, mobile-enabled visibility across the supply chain, Krebs says that budgetary issues can keep companies from taking the leap.
The hardware and applications are just one cost component, Krebs notes, with workforce training as well as creating the underlying infrastructure necessary for integrating the system with current solutions also coming into play. And while mobility is usually a “Top 5” IT initiative for logistics operations, Krebs says that the budgets dedicated toward the cause don’t always reflect that supposed priority level.
In terms of the integration challenge, Krebs points to the cloud as one way to make back-end, service-based platforms more available and collaborative across a wider swatch of mobile users.
“The cloud is helping to bring down some of the barriers to achieving real-time supply chain management and logistics visibility,” says Krebs, who expects a continued push for this supply chain Nirvana over the next 12 months. “It’s really quite an exciting time in terms of what we’re seeing happening in the mobile space as it relates to logistics applications.”
Simon Ellis, practice director at IDC Manufacturing Insights, concurs, saying that new innovations in the space are being driven by a combination of user demands and vendor innovation. And while he sees the use of mobility in the supply chain as more of an “evolution versus a revolution,” Ellis sees more and more companies attempting to capture field-based data with the help of an automated device.
“In such cases, smartphones, tablets, and similar devices are increasingly the hardware of choice,” says Ellis, who, like Krebs, points to the BYOD movement as another key point of progress for mobility in the supply chain.
“The whole idea of BYOD is interesting and something that in the long run is going to accelerate adoption,” says Ellis. Also moving the adoption needle right now is a supply chain software community that is attempting to be proactive about integrating data collection and management capabilities into their solutions.
Retailers that have honed their freight movement processes to the point of complete efficiency, for example, are now trying to eke more savings through true, real-time, continuous visibility. According to Ellis, that’s where the vendors come in.
“As omni-channel commerce becomes more and more prevalent, and as consumers intrude into the supply chain in ways they didn’t five years ago, expectations around visibility and performance are not going to relax,” says Ellis, “they’re going to intensify.” That, he concludes, will drive motivations both on the part of the shippers and the logistics software providers. “At the end of the day, the mechanics of achieving this goal will fall more to the latter,” he says.
About the author
Bridget McCrea is a Contributing Editor for Logistics Management
based in Clearwater, Fla. She has covered the transportation and supply chain space since 1996, and has covered all aspects of the industry for Logistics Management
and Supply Chain Management Review
. She can be reached at [email protected]