Published on 12/05/2016 | Operations
The Internet of Things (IoT) is a scenario where any thing, can be uniquely identified and transmit data to a network without any human intervention. But don’t just think of it as connected devices, it’s more than that; it’s embedded technology collecting a phenomenal quantity of data being produced. Autonomous IoT occurs when actions are taken based on this transmitted data, again without any human intervention. All sound a bit sci-fi? Here are 3 reasons you need to embrace it:
The advent of Internet Protocol version 6 (IPv6) sees IP addresses lengthened from 32 bits to 128 bits in anticipation of considerable future growth of the Internet. According to the Computer History Museum this means that we could assign an IPv6 address to every atom on the surface of the earth, and still have enough addresses left over to do another 100 earths.
IoT is being implemented at a rate where the foreseeable future will see it become a ubiquitous and normal part of everyday life. This connectedness is anticipated to present a USD $20 trillion global opportunity to create value.
In Barcelona, intelligent street lighting saves the city more than USD $35 million per year, and garbage trucks can monitor trash levels and eliminate pickups from areas not required, or reroute, creating efficiencies and cost savings for the city. Rolls-Royce has embedded chips into its aircraft engines to feedback real time data on operating levels, efficiency, condition, and hours flown, allowing for better planned maintenance and replacement operations.
What does all this mean for the future of your supply chain and procurement processes? And how far can it go? New or imminent applications include warehouse sensors for the monitoring of stock levels and warnings for reordering. Advanced applications include automatic reordering of stock when levels fall below a predetermined trigger point. But what if historic data facilitates automated ordering of quantities based on seasons or special events without input from a user? What if the data suggests a different product mix will produce greater sales and hence greater profits for the company, and stock was automatically ordered based on this?
Other current applications include sensors monitoring and producing real time data of plant and equipment and feeding back reports to engineers. Data can suggest integrity issues, or routine maintenance coming up based on hours logged, whereupon appropriate actions can be taken. What if, based on the data and sensors, a higher level of analysis can be performed, and technicians or engineers can be ordered to rectify errors or perform routine maintenance? What if a part is worn or broken and a replacement part is automatically ordered, and an installer is also ordered to come and make the repairs?
In the next century, planet earth will don an electronic skin. It will use the Internet as a scaffold to support and transmit its sensations. – Neil Gross 1999
Someone somewhere is going to have to procure all of these devices and data storage in order to effectively utilize the IoT. But don’t worry, autonomous IoT is here to help us do that too.
Let’s take a step backwards, before operations and into a project procurement/building phase, and see what the future may hold. Based on historic data from your previous projects (all collected and recorded by autonomous IoT) and requirements for this new project as determined by you, your project and procurement program or timeline is produced for you. Alerts are sent to you based on established time-frames to let you know that you need to begin the procurement process for a specified item or portion of works.
Better yet, a search algorithm has provided you with a list of companies who have the capability to provide these services, along with an analysis of their recent completed works, their financial data, and any other major issues that may affect their ability to provide the services. Previous procurement data suggests a specific scope, requirements and milestones for the portion of works for your consideration. When you are ready your request for proposal/quotation/tender will be distributed to the appropriate persons within the companies you have selected.
Upon receipt of proposals a comparative price analysis is performed for you, starting with overall price and drilling down to item specific prices and forecast quantities required. Furthermore, it compares delivery time-frames, health and safety records, payment terms and quality records. Key financial ratios and performance risk analysis are calculated and prepared for direct comparison. An evaluation matrix is prepared and autocompleted with likely key criteria based on the risk of the works, with multiple options provided via a sensitivity analysis.
Video monitors show a live feed of the factory/manufacturing plant/construction site so that you can view the operation and see how the tenderer works. Data shows how efficient the tenderers operation is, how much downtime occurs, how old equipment is, and whether software is up to date.
Historic data is mined to provide suggestions on any proposed amendments to the terms and conditions of the agreement. All of the above information is compiled and the suppliers’ willingness to negotiate is determined, as well as potential positions of advantage for your company.
All that’s left is for you to negotiate and execute the final agreement. Job done.
The IoT can often seem overwhelming and complicated for those seeking to explore the possibilities. But don’t bury your head in the sand, it has arrived, and it is here to stay. Be an early adopter, and you will be able to take advantage of the vast opportunities it presents in strengthening and creating efficiencies in your procurement processes.
This article was originally posted on LinkedIn.
