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RouteiqueMar 12, 2020 3:39:00 PM5 min read

How IoT Provides A Fix for Logistics Problems

How Will IoT Provide the Ultimate Fix for Logistical Problems

With the logistics industry growing, and fast, problems have started surfacing. One complication or glitch can disrupt countless other processes and systems along the way. Luckily, inter-device communication provided by the IoT platform (internet of things) is trying to provide an effective long-term fix for many of the problems in the logistics sector today.

There is much emphasis on effectively processing and leveraging the data that is being used by companies to deal with the ever-increasing problems. Customers are demanding better services than ever before. Free shipping and other such offers have become the norm and they are eating away at the average revenues for each individual shipment. The costs of connected devices, such as automated robots and RFID sensors, have decreased considerably. These devices are being installed and integrated in the systems and will hopefully provide the solutions to the logistics sector’s most pressing concerns.


Compliance to Standards


It is the top priority of all logistic companies to have transparency in their processes and comply with government regulations and standards. Government regulations will always increase as the logistics sector develops to keep the pressure on them. Fast data capture and “on the spot” analysis of logistics processes through management software and accompanying IoT hardware can help integrate and enhance aggregate KPIs for effective and better operational efficiency. This way, the compliance initiatives can also be incorporated and accounted for in the overall processes. As a result, the risk of compliance violation will reduce, freeing up valuable capital and financial resources for cloud based systems and IoT enabled machines.


Cost Reduction and Minimal Delays


“The cost of delays is too damn high”. Delays in processing, errors due to human error etc. are what drive down the profitability of the whole logistics business. IoT platforms are luckily tackling this problem with grace. Reported claims say that inventory management is more accurate (up to 99.5%). Even the costs of labor and order processing time have both reduced (by as much as 30%) by using these innovative software and hardware.

This is just the beginning of the spectrum. Maintaining the fleet vehicle conditions with the use of GPS-enabled and integrated technologies is much easier. It reduces the downtime that the vehicles face and drives down losses. Even workloads are distributed more effectively and reduce the strain and pressure on field employees.


Synergetic Processes


Silos are detrimental to maintaining agility. Despite the silos do exist and create havoc across the supply chain. A prime example is manual data entry that is still used by many and is the base of many processes involved in the logistics industry.

IoT can help breakdown these silos for a more integrated and connected system of communication, thereby reducing errors. Tracking problems will become easier as a manager will be able to identify problems in a certain warehouse before a vehicle arrives. For example, if a certain shipment is stuck in transit and is marked urgent, workers can be reassigned to speed up the process. A potential bottleneck is avoided in this way and the assigned driver can pick up the shipment as planned.

On the other hand, if handled manually, even a delay of 5-10 minutes can result in deadhead costs for the company. Costs like these can be saved through integrated management systems. IoT enabled systems can be used to put agile systems into place which rely on continuous feedback and analysis of processes to identify and even predict problems before they occur. This means that, potentially, any problems with production can be identified and solved to keep output and transit steady.

Currently, there is still some debate about whether drivers will continue to work due reduced work hours (and payout) or if they will look for other jobs if process stability is maintained. One thing is for sure, the process of transporting things from point A to point B cost-effectively and with minimum efficiency is on the road to continuous improvement as IoT develops.


Need For Safety


There are a lot of serious financial and legal penalties that companies face when they break safety and health rules put forth by the authoritative organizations such as the OSHA. Logistics companies face fines and investigation probes as a result of violations. The saddest part is that these violations could have been prevented. For instance, the US Dept of labor’s OSHA found that a worker for a metal container manufacturer accidentally amputated his own right middle finger’s tip while trying to clear a jam. The reason: an improperly installed safety guard. The company faces more than $81,000 in penalties as this was the 3rd serious amputation injury of the same kind in 17 months.

Incidents such as these can be avoided if companies comply with safety regulations put forth. Had IoT been used to identify safety concerns, this incident and others like it would have been avoided. If the machine was integrated with IoT capabilities, then the jam would have caused an automatic shut down of that part of the machine until it was fully repaired by maintenance crew. There is always that one extra step that one can take in order to ensure safety standards are met.


Evolution of Global Logistics


Consumers have become smarter and more tech savvy. This is one of the major growth factors for the emerging IoT technologies. Smart systems in homes and the appliances are already developed and in place. This rise in acceptability of these IoT systems is fuelling a fall in the costs. It’s simple economics. As demand for these devices and systems rises, costs will fall. With the pace at which these systems and smart machines are developing, it is no surprise that the costs are falling the way that they are. Households and the industry alike are keener in adopting these smart systems. The logistics industry is significantly impacted by the use of IoT. Its effectiveness in streamlining the existing supply chain is remarkable and it is only a matter of time before cloud management systems are in place effectively across the board, ready to perform.

To know more about IoT and cloud based systems and how they can be beneficial for your logistics business, get in touch with us through the link in our bio!