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What Can the Logistics Industry Expect from the IoT?

The Internet of Things isn’t a new concept. It’s a buzzword that’s been around for years but listening to the discussion at this year’s CSCMP Annual Conference, I think the hype has really moved on to something meaningful for our industry.

The Internet of Things (IoT) is a simple term for a complex concept – it is the connection of all devices to the Internet and each other, enabling them to exchange data over a network without any human intervention. But why does that matter? And why is it relevant to transport optimization?

As device talks to device it generates data. The kids empty the last of the milk in the fridge so you receive an alert to buy some from the grocery store, or an onboard telematics system detects that a delivery driver is running late and provides an automatic update to an online arrivals board for store managers, and triggers an SMS alert to those store managers.

What’s really interesting, as reported in this year’s IDC Internet of Things study1, is the data that the machine-to-machine “conversation” generates. In 2014, Gartner was already predicting there would be 26 billion internet-connected devices by 2020. With all of these devices generating data, manufacturers and retailers will have access to consumer insight based on millions of interactions each day. For the logistics industry it means unprecedented levels of in-transit visibility of individual items at every single step of the supply chain.

Today most trucks have either an Electronic Logging Device, GPS or telematics equipment within the cab. These devices can send data from the vehicle to the transport office, providing information on how a driver is driving (speeding, breaking too hard, etc.), whether the driver took the assigned route, monitor whether drop-off/load times are longer than anticipated, analyze stop/rest/break times and much more.

The real step change for the logistics industry will come when we can leverage the full benefits of connectivity, the convergence of data from disparate sources into an intelligent network of internal and external assets that communicate and interact seamlessly. Here are some examples:

  • Transportation planners can track and monitor a container in the middle of the ocean or trace a pallet on a truck in the Southwest allowing them to monitor progress against plan and automatically update the next stages in the supply chain process.
  • Shippers can gain clear visibility of the movement of their orders, allowing them to track and trace products to any location at any time, and take immediate action if it’s not where it should be.
  • Sensors inside boxes can send an alert if a product has been opened or removed from a pallet, alerting manufacturers to the potential that a product has been tampered with, or if a trailer drops below the required temperature for chilled or frozen goods.
  • Drivers can be alerted that they need to take a break, preventing an accident and helping drivers adhere to Hours of Service regulations.
  • Intelligent mailboxes or lockers with sensors built in can determine when a box is opened or closed. Consumers can then be alerted to the delivery, ensuring any perishable products are picked up on time.

CSCMP 2016 was all abuzz about IoT but here at Paragon I think we’ve already been enabling communication between different devices for some time. For example, we already integrate with 35 different telematics platforms through Paragon Route Execution providing transportation planners with automated reports about events like missed arrival times, harsh braking, fuel usage and Hours of Service compliance.

While not everybody in the US may be ready to embrace Electronic Logging Devices, the IoT does provide a level of supply chain visibility and operational insight that will help all operations reduce fuel usage and mileage, while generating strategies for improved customer service.

If you’re starting to think about the benefits of transport optimization, or you’d like to find out more about integrating Paragon routing and scheduling software with a vehicle tracking system why not get in touch with our local team to discuss your requirements further.


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