Supply chain organizations are increasingly leveraging the internet of things (IoT) to improve operations and improve customer service. A recent survey of 600 supply chain decision-makers shows a majority of organizations either have or plan to have an IoT strategy in place.

The survey was conducted by EFT, a business intelligence company service the logistics and supply chain industry. Of the supply chain managers surveyed, 60% worked for logistics providers and the remainder worked for manufacturers or retailers. Nearly a quarter said their organizations have IoT on their roadmap, and 41% already have an IoT solution in place. Additionally, the majority (87%) said their organization was looking to expand the use of IoT.

The use of IoT among supply chain organizations has increased in the last two years, as eft pointed out in its report. Specifically, IoT sensor and monitoring technology increased 19% among survey respondents between 2014 and 2016. Data logger usage increased 14% and GPS and satellite technology grew 5%. The use of barcodes and RFID has remained steady over the last couple of years, EFT said.

The main reason organizations turn to IoT is to gain more visibility into their supply chains to better serve customers. Specifically, organizations planning to expand their use of IoT also cite improving customer service by providing better information and providing customers with more frequent updates on shipments as top reasons to use the technology.

“As supply chains are strained under competition, technology is proving to be a valuable differentiator and competitive advantage,” the EFT report said.

Of the companies looking to increase IoT technology, the majority plan to ramp up sensor and monitoring tools. GPS and satellite tracking technology came in second for how organizations plan to increase supply chain visibility.
The survey findings show a growing interest in IoT and advanced technologies that complement IOT like machine learning or artificial intelligence that can automate supply chain processes. Between 2014 and 2016, the use of machine learning, for instance, grew 21%, eft said.

“Most importantly, we’re seeing a clear shift in preference towards IoT and away from some of the more traditional visibility tools — bar codes, RFID, etc.,” the EFT report said. “This trend is only going to be further entrenched as companies continue to see ROI from their IoT investments.”

Cybersecurity Threats Remain a Concern

While organizations realize the benefits of the IoT, many still feel that cybersecurity is a threat to their IoT strategy. Nearly half, 47%, of eft survey respondents, said cybersecurity was a “moderate” threat. About a third identified it as a minor threat, while 17% said cybersecurity was a major threat to their organization’s IoT strategy. Just 5% said it was not considered a threat.

Other surveys echo these concerns about security breaches when ramping up IoT technology. According to Vodafone’s fourth annual IoT Barometer Report, for instance, 18% of businesses believe concerns about security breaches kept their organization from more widely adoption IoT technology. And, the IoT 2016 Deployment Trends and Usage Survey conducted by Strategy Analytics also showed 56% of businesses surveyed cited security as their biggest concern with an IoT deployment.

Source: Spend Matters