When a simple conveyor belt of a food manufacturing equipment started to malfunction, Sam, a retailer, incurred a great loss both in terms of money and time. He had to meet order deadlines but failed to produce the orders on time and thereby lost his reputation, revenue, and profitability. But the good thing is, Sam’s company was quick to pick up on the mistakes and recently leveraged IoT technology, making such catastrophes a thing of the past!
Taking a Leap to Predictive Maintenance – Fixing Problems Before They Occur
Stable supply chain operations are crucial. Sudden and expected machine failures and downtimes can result in loss of productivity and customers and can impact shareholder value too. Asset-intensive industries are often seen quoting unexpected failures of their assets as the prime reason for business failure.
IDC has predicted that by 2018, the growth of advanced, purpose-built, analytic applications linked with IoT technology will result in a 15% productivity improvement for manufacturers in innovation delivery and supply chain performance. So, when Sam encountered significant losses fixing the looming equipment malfunctions, he didn’t wait to embed IoT technology. He is content now as IoT platforms have created opportunities for pre-emptive notices of hovering equipment failures, enabling him and his team to fix the problem before it occurs. So, let’s see what Sam did to put an end to machine failures.
Sam is a fast learner. Though he had nightmares while trying to reduce repair expense during his first equipment failure, he didn’t give up. In fact, he took everything as a learning experience and incorporated predictive maintenance as the first step towards preventive maintenance.
Predictive maintenance is the way of scheduling maintenance in a proactive manner wherein data based models are used to detect anomalies at their infancy stage. Well, Sam understood that it’s not possible to monitor equipment continuously, so he let predictive analysis take the lead. This technique monitored the equipment constantly to detect any signs of potential failures. Sam has much more control over the operations of his equipment today. He is a bit relaxed now as he has got the ability to do a complete check of the condition of the machines/equipment and can easily predict when a part of the equipment is going to fail, thus avoid sudden and unplanned downtime nightmares with predictive analysis.
Sam has much more control over the operations of his equipment today. He is a bit relaxed now as he has got the ability to do a complete check of the condition of the machines and equipment and can easily predict when a part of the equipment is going to fail. He is thus keeping sudden and unplanned downtime nightmares at bay with predictive analysis.
Want to know how it’s done? Well, there are varieties of industrial sensors available in the market based on different equipment. Moreover, these days every machine comes with pre-built sensors. All you need to ensure is that you have all your sensor data stored in one central location where it can be analyzed. Based on the data collated from the sensors, many algorithms are run through it, revealing failure patterns. These failure patterns give you signals for impending failures which are hard to find via human inspection alone.
Disrupting Demand Forecasting and Inventory Management with IoT
When Sam was beaming with joy after realizing the profits from the integration of IoT platforms, holiday season had kicked in. Seasonality has always been a critical challenge for every retailer, be it Christmas or New Year, and Sam was no exception. While he was getting better on the operational front, he wanted to do well on the customer’s side as well. However, he was worried about seasonality affecting the flow of clients and their preferences.
During the high-demand season, he wanted to ensure that all the items for sale never run out of inventory. He again took advantage of IoT platforms, now to keep his customers happy. Although cloud-based inventory management systems and RFID tags are helping retailers to get visibility of their inventory levels, forecast demand, item location, and expiration dates, the introduction of IoT has beefed up the inventory management and tracking process.
So, when Sam used RFID tags built into the items with IoT technology, he could get information on temperature, weather, damage to the object, and traffic to the inventory system. With a unique identifier on every item, Sam was able to keep track of each item and increase management of stock shortages and overstocks. Additionally, he could identify shipments that get stuck in unexpected situations like traffic and which items have been damaged and needed immediate replacements.
Like Sam and his company, other large enterprises are now embarking the IoT journey for demand forecasting planning and efficient inventory management.
Levi Strauss has been collaborating with Intel to run a POC using Intel Retail Sensor Platform in three of its stores. The purpose of using this platform is to track inventory in real-time through RFID tags without intruding consumers’ privacy.
The RFID tags aim for a future free from the disappointment of the words “not available in your size” or “we’re out of stock”, and these are the details we count on
– Levi Strauss (Website)
Though it’s still not employed widely, the responses are on the positive side.
Danish retailer Magasin has opted for IoT analytics to smoothen back room operations and optimize procurement.
Specifically, the two or three people in merchandising now freed from ordering goods to the minimum stock, and they can concentrate on more creative functions to respond to developments in sales, inventory, and procurement
– Magasin (Website)
With so many companies coming forward as early adopters of IoT technology and curbing supply chain challenges, IoT with its potential will soon break open its infancy cocoon and see many more adopters across the world.
Another area where retailers like Sam face bottlenecks is transportation. Carrying and moving merchandise efficiently remains one of the prime goals for them. IoT analytics helps in fulfilling their goals of smart transportation in retail by maintaining transport, tracking, and route optimization. Today, almost every retailer uses GPS to track and route their transportation vehicles, and with IoT devices and IoT sensors coming into play, they can understand and get the details with much accuracy. Furthermore, it gets easy for them to find how close a pallet of merchandise is to a particular retail store.
Retailers who are embarking the IoT journey are sure to witness the differentiation in terms of serving their customers better and creating value. In the supply chain sector, IoT is providing real-time visibility, smart data collection, and more proactive and automated problem-solving. Like Sam, to prepare yourself for the wave of IoT, you must understand its effectiveness and start partnering with the third party to simplify supply chain operations.
On that note, read more on how you can enable business transformation with IoT analytics.