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Internet of Things, Connected Infrastructure & The Modern Supply Chain
The document explores the Internet of Things (IoT), defining it as interconnected people, places, and things equipped with sensors to communicate via the internet. It discusses IoT's impact on supply chain transformation, highlighting examples such as smart warehouses and roads, with significant potential for efficiency and savings. Challenges such as security vulnerabilities, talent shortage, and data utilization are noted as crucial points to address in adopting IoT technologies.
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Internet of Things, Connected Infrastructure & The Modern Supply Chain
- 1. The Internet ofThings, Connected Infrastructure & The Modern Supply Chain Blaine Kelley CBRE Blaine.Kelley@cbre.com Jeff Risley Bartlett & West Jeff.risley@bartwest.com
- 2. Agenda 1. The Internetof Things, Defined 2. Impacts & Opportunities 3. Elephants in the Room
- 3.
- 4. What is TheInternet of Things? It’s people, places & things that are connected to the internet, embedded with sensors, and communicating with each other.
- 5. What is TheInternet of Things? It’s people, places & things that are connected to the internet, embedded with sensors, and communicating with each other.
- 6. People & TheInternet
- 7. Places & TheInternet
- 8. Things & TheInternet
- 9. What is TheInternet of Things? It’s people, places & things that are connected to the internet, embedded with sensors, and communicating with each other.
- 10.
- 11.
- 12.
- 13. What is TheInternet of Things? It’s people, places & things that are connected to the internet, embedded with sensors, and communicating with each other.
- 14.
- 15. Is It AGood Thing? “Bad news — the scale is threatening to cut off our access to the fridge…”
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- 20. IoT & SupplyChain Transformation Inside The Box Outside The Box The Box
- 21. IoT & SupplyChain Transformation The Box
- 22. The Box • Eatingits own cooking: Malaysia pilot project • 1300 sensors – Power usage – Device management – Carbon emissions – Utility bill analysis • Projected facility savings: $1m/year • 20%-30% energy reduction across all manufacturing plants
- 24.
- 25. IoT & SupplyChain Transformation Inside The Box
- 26. Inside the Box •Old system: Pickers, list of items, walking the warehouse, filling a tote • New system: Cart-like robots, list of items, retrieve products, deliver to worker. • All “Things” communicate
- 27.
- 28. DHL “Vision Picking” •Replace hand-held scanners and paper w/ Google glass and WMS • Tell fastest route to products • Reads bar codes • Test results: 25% reduction in pick/pack time. • Best application: e- commerce warehouses • Temp workers
- 29. Inside The Box •IoT will further our ability to be effective and efficient: • EVERYTHING is coordinated, take all the RFID chatter to the next level • You follow each piece and track it…great • You follow each piece, track it, tell its friends, make decisions on its proximity to others to automation to time stamps and so on
- 30. • IoT willspeed up order cycle times • Therefore improving service and speed • Trifecta is fast, low cost and seamless service • IoT will take the ordering process to new level, orders will hit DCs before we even know we need it Inside The Box
- 31. IoT & SupplyChain Transformation Outside The Box
- 32. Smart Roads • TimSylvester: Make “dumb” infrastructure “smart” • Factory-built, modular pavement • Embedded sensor network • Capture roadway conditions, cracks, potholes, traffic jams • Future: Driver-less vehicles talk to the road
- 33.
- 34. Smart Railroads • GEEvolution Locomotive • 220-ton computer • 6.7 miles of wiring, 250 sensors, 9 million data points/hour • Gear case: oil levels & contaminants that lead to axle failure • “These conditions, in this sequence, means 90% chance this failure will happen.”
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- 36. • Security –70% ofthe most commonly used IoT devices contain security vulnerabilities (HP Study). • Talent –Tech talent. Data scientists. • Data –Data is the river. Insight is the goal.
- 37. Predictive Analytics Push • Producebased on expected demand, push to market Pull • Demand and Inventory trigger production Predict • Real-time data, centralized visibility, predictive modeling
- 38. GE New BusinessModel • Outcomes instead of functionality • “Selling locomotion, not locomotives.” • Infrastructure as a Service (IaaS) – Remote Diagnostics (predictive maint) – Trip Optimizer (fuel savings) – Yard Planner (decrease dwell) – Movement Planner (improve speeds)
- 39.
- 40. Thank You! Blaine Kelley CBRE Blaine.Kelley@cbre.com JeffRisley Bartlett & West Jeff.risley@bartwest.com
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- 44. The Box • VariableRefrigerant Flow (VRF) zoning • Central “smart” controller • Happy workers
- 45.
- 46. Target Example: InsideThe Box
- 47. Daimler Example: Outsidethe Box
- 48. Purfresh: Sensitive Cargo •Fresh food monitoring in refrigerated containers • Temperature, humidity, oxygen, CO2, power, shock • Geofence, timestamp
Editor's Notes
- #3 We will be introduced by Roger Woody and Chris Gutierrez Ask for a show of hands…how many in the audience are shippers? Suppliers or Consultants to Shippers? Acadamia? Let people know that if they want to leave because this doesn’t apply, you won’t offend us. Here’s the three things we’ll cover today: We want you to walk away provoked – personally & professionally – enough so that you’ll think differently about your day-to-day tasks.
- #4 Many of you are probably familiar with the term “Smart Home”; Some of you may have this technology in your homes today. Smart Homes are an example of the “internet of things,” and they are here today – not some distant future.
- #5 There are many definitions of the Internet of Things, but we like to boil it down to this: Let’s look at each part of that definition…
- #7 http://www.emarketer.com/Article/Internet-Hit-3-Billion-Users-2015/1011602 People were the first users of the Internet – way before “things.” Ubiquities internet adoption by people is important for the IoT revolution, and by 2018, almost half the people on the planet – 3.6 billion people – will be able to access the internet.
- #8 http://wearesocial.net/blog/2014/09/world-mobile-phone/ “Place” is location, and today that means mobile devices (including wearables). More and more people are accessing the internet via their mobile devices. The number of unique mobile phone users around the world has just passed 50% of the world’s total population. Growth is staggering -- 750,000 new mobile users every day – or 9 new users every second. (GSMA Intelligence –https://gsmaintelligence.com/) More people on the planet have a mobile device than a toilet (water.org).
- #9 https://www.lordabbett.com/en/perspectives/equityperspectives/finding-growth-in-an-increasingly-digital-world.htmlion today. So first people, then places, and now things are connecting to the internet. Projections differ, but a conservative report estimates there will be 50 billion devices connected to the Internet by 2020, compared to 18 billion today.
- #10 Ok, so all these people, places and things are connected to the internet…so what?
- #11 http://postscapes.com/what-exactly-is-the-internet-of-things-infographic Connectivity is one thing, but smart connectivity is another, and that’s where Sensors come in. The sensors are like nerve endings in the body – we are building a digital nervous system. A sensor on something can make that something “smart” – it can tell something else… Know position Detect motion, temperature, humidity Sound, vibration The presence of chemicals Force, load or pressure Leaks, Electricity or magnetism Acceleration
- #12 http://venturebeat.com/2015/02/07/how-the-internet-of-everyday-things-could-turn-any-product-into-a-service If you think about all the different kinds of “things” in the world, you realize how innovative these sensors must be. They continually have to be flexible, like this product
- #13 http://globalbiodefense.com/2013/03/13/electronic-sensor-tattooed-on-skin-as-real-time-health-monitor/ Small and personal, like this “digital tattoo” – yes, it’s a temporary sensor that can be attached to skin that has a multitude of functions… Average sensor prices have dropped to 60 cents from $1.30 in the past 10 years (Goldman Sachs).
- #14 So connecting everything to the internet, making those connections “smart,” and then ultimately, helping it all communicate with each other.
- #15 For instance, Diageo could upload promotional offers while the bottle is in the shop but change that information to cocktail recipes when the sensors show the bottle has been opened at home. http://www.diageo.com/en-row/ourbrands/infocus/Pages/diageo-and-thinfilm-unveil-the-connected-smart-bottle.aspx
- #16 So all of this smart, connected stuff, talking to each other…is it a good thing?
- #17 Have we just gone to far?
- #18 http://www.gartner.com/newsroom/id/2819918 Gartner puts the Internet of things very clearly at the top of the “Peak of Inflated Expectations.” And by being here today, talking to you about this, we are clearly adding to those expectations. But they are also projecting the IoT will reach the “Plateau of Productivity” in the next 5-10 years.
- #19 http://www.pwc.com/us/en/advisory/business-digital-technology-trends-sensors.jhtml How many of you here work in a supply chain business that touches consumer products or industrial products? 52% of retail and consumer products companies are investing in IoT technology, and 33% of industrial products companies (PWC) From your inventory to its container, from the container to the carrier, from the pallet to the warehouse. The more your assets can 'speak' to one another and share data, the more they can work together to help you improve your processes."*
- #21 We categorize the impacts to Supply Chain in three parts: What happens to “The box” -- the building itself. What happens “Inside the Box” – the manufacture, movement and storage of products inside the building What happens “Outside the Box” – transportation of goods
- #22 Energy & Sustainability Predictive Maintenance
- #23 http://www.wsj.com/articles/cisco-tests-internet-of-things-in-its-supply-chain-1431554801?cb=logged0.13812174461781979 http://blogs.cisco.com/cloud/energy-management-and-the-factory-of-the-future In one of the latest initiatives to get its own supply chain fully wired, Cisco has been installing thousands of sensors in a plant in Malaysia to monitor and reduce energy consumption. Mr. Kern said in an interview with The Wall Street Journal that the team leading the project believes that implementing the system throughout Cisco’s worldwide production sites will help reduce energy consumption by 20% to 30%, translating into tens of millions of dollars in cost savings. The Malaysia project is a pilot program that is part of a $4 million fund the company established in which employees brainstorm and test projects to make the company more productive. The projects cover a wide range of supply chain issues and are relatively small-scale for a $47 billion company—the energy management project in Malaysia cost less than $700,000—with the understanding that most will fail. But those that succeed can provide innovative solutions and major savings, Mr. Kern said.
- #26 Material Handling Systems Warehouse Control Systems Warehouse Management Systems Robotics Distributors and manufacturers are challenged with keeping track of assets that are in almost constant motion. Without appropriate strategies in place to manage the tracking of equipment, supplies, and products, the likelihood of misplacing or losing valuable assets increases. Utilizing real-time IoT devices eliminates manual data entry and automates tracking processes, reducing human error and insulating businesses from costly asset loss.
- #27 http://www.supplychain247.com/article/enter_the_smart_internet_of_things_warehouse/Zebra_Technologies Lids, an Indianapolis company, sells fashion athletic headwear, team apparel and other fan novelties. In the old days, order takers - known as pickers - would get a list of items and walk around the warehouse, looking for the right ones and loading them up in a tote. It took a long time. Recently, however, Lids started using an Internet of Everything (IoE)- based robotic system and life has become a lot more efficient. Now a list with items is automatically sent to cart-like robots, which retrieve the products, place them in bins, and deliver them to a worker. The worker then loads the material onto a truck in the correct order. Sensors detect everything from a robot’s location to whether pallets are en route to the shipping dock and then wirelessly transmit that information to a remote monitoring team.
- #29 http://www.wsj.com/articles/dhl-unit-plans-google-glass-experiment-in-us-warehouses-1439568950?mod=WSJ_TechWSJD_NeedToKnow Wearable computers like Google Glass never took off with consumers but the Internet-connected eyewear are finding their niche in the logistics industry. Exel, the freight forwarding arm of Deutsche Post DHL Group’s supply-chain management business, is preparing to test “vision picking”— replacing handheld scanners and paper job orders with wearable “smart-glass” devices outfitted with warehouse management software—in two U.S. warehouses later this year. The devices can tell workers the fastest route to find products and can read bar codes, which reduced the time needed to pick out an item and pack it for shipping by 25% in tests at a Dutch warehouse earlier this year, Exel says. The technology has the most application in e-commerce warehouses, where workers might need to find a handful of items out of more than a million individual products, the company said.
- #33 http://www.kansascity.com/news/business/technology/article15650132.html#storylink=cpy As the nation’s overall repair needs reach the trillions of dollars, Sylvester and a coming generation of engineers hope to convert dumb old infrastructure into tech-rich traffic lanes, pipelines and utilities boasting brains tuned to the 21st century. A highway project in the Netherlands uses solar panels and tiny windmills blown by passing trucks to store energy for embedded LED lights, allowing roadways to glow at night. ▪ Scientists are testing “self-healing” concrete designed to produce bacteria to fill cracks, according to the global engineering firm Arup. ▪ Some U.S. bridges are currently dotted with sensors that provide real-time data when the heaviest trucks, possibly illegally overloaded, rumble across. ▪ Drawing boards around the world include pavement threaded with heating elements to melt snow and roadside Wi-Fi to alert motorists to rough patches ahead. ▪ Many futurists expect that by 2030, self-driving cars will be wirelessly talking to one another and to the road itself, promising to make motoring safer, swifter and mistake-free.
- #35 http://www.fastcompany.com/3031272/can-jeff-immelt-really-make-the-world-1-better Measuring 73 feet long and weighing in at around 436,000 pounds, the Evolution drinks diesel from a 5,300-gallon tank At roughly 220 tons, it is in many respects a hurtling computer. Its array of sensors and data-collecting devices complements its bulky mass with a sleek, digital agility that will grow only more impressive and more significant with time. Its insides contain 6.7 miles of wiring and 250 sensors that put out 9 million data points every hour. For example, GE has begun putting a radio-frequency sensor inside the locomotive's gear case to transmit data on oil levels and contaminants, and by parsing that data, Stokes says they should be able to predict the conditions that lead to axle failures. "The goal is not just to take data I have today, but to go back and look at the data we have already and see if it shows we could have predicted a historical failure," Stokes says. His team would look at the broken-down locomotive and comb through its data banks to try to discern a pattern. "We want to turn that into an algorithm that helps us predict the future," Stokes explains. "We want to say: These three conditions, in this sequence, mean there's a 90% chance this failure will happen."
- #38 Predictive analytics is the application of advanced statistical analysis of structured and unstructured data sources to identify patterns and predict future events or outcomes. For example, predictive analytics can provide companies with a look into the future and give them opportunities to identify emerging patterns in the marketplace that can lead to highly effective and personalized customer engagement strategies. 3. Beyond Push and Pull, You’ll Be Able to Predict. The old way of manufacturing was based on a push system. You’d produce a product based on your expectations of demand, and then push it out to various markets accordingly. Expectations like the best laid plans, often go awry. So the next step was to create a pull system, where demand and inventory stock triggered production up the supply chain. This is a good system, but it depends heavily on accurate data, and many companies find it difficult to execute without a centralized visibility platform. The IoT will further incentivize moving toward a centralized visibility platform by taking push and pull a step further—it will use real-time data and analytics to predict demand, combining the best of planning and execution. Real-time data would feed into constantly improving models of demand, creating a production system that’s always in pulse with the markets.
- #39 An approaching third wave, enabled by data and analytics, does something new. It strikes an agreement between GE and a customer for a certain kind of outcome, rather than a certain kind of functionality. "Or we're selling locomotion, not locomotives. And we guarantee that back to our customers. GE announced today that it was expanding its Predix Internet of Things platform to provide Infrastructure as a Service (IaaS). With today’s announcement, the company will be providing infrastructure services to run those applications.
- #43 Even though the consumer segments of the IoT get all the press, it’s the Industrial sector that is forecast to have the most connected devices in the IoT, according to IHS research. IHS puts the total number of connected devices by 2025 at more than 80 billion – the largest share of that being in the industrial sector. From your inventory to its container, from the container to the carrier, from the pallet to the warehouse. The more your assets can 'speak' to one another and share data, the more they can work together to help you improve your processes."*
- #44 And ultimately customizable, like this Bluetooth sensor used in retail outlets can send customized Information to a mobile device.
- #45 Variable Refrigerant Flow (VRF) zoning is an energy-efficient method of providing precise comfort control to indoor environments. VRF offers a wide variety of applications - everything from spot-cooling or -heating a single room in a home (using a split-ductless system) to a large commercial building with multiple floors and areas (that require individual comfort control delivered by a split-zoning system). VRF moves refrigerant to the zone to be heated or cooled, allowing the temperature of that area to be more precisely controlled. It can simultaneously cool some zones while heating other areas or just provide comfort control to zones that are in use. (Zones are single or multiple room spaces that are conditioned to a set temperature and are operated independently from other rooms within the same structure.) Ductless systems provide more building design flexibility and result in more usable space. Ducted systems allow you to combine multiple rooms into a single zone. Unlike other VRF systems, Mitsubishi Electric Cooling & Heating uses a two-pipe design which reduces the complexity, time and cost of installation with fewer refrigerant lines and connections. INVERTER Compressor technology is highly responsive and efficient. The technology allows for compact, quiet units, flexibility of placement and gives architects and owners more design freedom with Integrated, simple to use controls.
- #46 http://www.supplychain247.com/article/traditional_supply_chains_to_undergo_radical_transformation_by_2025 “The speed at which supply chain innovation is being adopted–coupled with rising consumer expectations for anytime, anywhere service–is stressing traditional supply chains to near-breaking points,” said George Prest, CEO of MHI, an international trade association that represents the material handling, logistics and supply chain industry. “Companies that continue to use traditional supply chain models will struggle to remain competitive and deliver orders that are accurate and on-time.”
- #47 http://www.zdnet.com/article/target-will-roll-out-rfid-price-tags-to-improve-inventory-management/ The Minneapolis-based retailer says it is working with key vendors to begin outfitting price tags with RFID smart labels, which Target hopes will improve inventory accuracy and out-of-stock issues. Jones said Target plans to launch the smart tags in a small number of stores later this year, and then eventually expand to all stores some time in 2016. In addition to improving inventory in-store, Target also expects RFID to have some impact on its e-commerce operations. Jones said the smart tags could help the retailer better fulfill online orders placed for store pickup, which she said account for 15 percent of Target.com purchases.
- #48 Equipping fleets with sensors designed to improve vehicle performance and diagnostic capabilities extends the life of costly assets. Vehicle-generated data-collection activities like location tracking, tire-pressure monitoring, stability control, and collision avoidance converge to make fleets not only more efficient, but also safer. Utilizing this wealth of data to adhere to vehicle-maintenance schedules and address unanticipated repairs as soon as they appear keeps budgets predictable, more extensive repairs at bay, and more vehicles on the road. New commercial trucks manufactured by Daimler Trucks North America, for example, are now equipped with sensors that feed data to a Daimler-operated call center—what equates to a "virtual service station." Sensors detect and diagnose maintenance issues in real time; the system communicates that information to the Daimler network, and then connects the driver with the call center to receive instructions. Drivers with critical issues are directed to nearby mechanics by means of a GPS system, which determines the truck's location. This automation and centralization of fleet management responsibilities have allowed for substantial gains in efficiency. For an example of how this can be used in the warehouse, see the sidebar.
- #49 Purfresh is using the IoT to change the shipment of perishable products by ocean. Purfresh is a provider of enhanced atmosphere technology and documented, real-time monitoring and control. This technology enables Purfresh to make ocean transport a viable option for even the most sensitive cargo. The Purfresh technology provides the capacity to collect real-time data, including the atmospheric conditions inside a refrigerated container and the container's location. The technology also sends automatic alerts (for an unexpected condition, such as an incorrect temperature or an unplanned power-off event) and provides detailed trip reports. When an issue is identified, it can be corrected remotely while the shipment is in transit, enabling perishable products to arrive intact and in good condition.