The Internet of Things; How connecting items allow us to better plan sales and operations?

The Internet of Things (IoT) is based on the following premise: Items built in the future will be more connected than former ones, being an integral part of a global intelligent network.

Like internet, which since its implementation allows people to exchange information for a derisory cost, the IoT will allow items to interact themselves through this global network. More items will be equipped with electronic chips, more they will be able to share information about themselves through a global network. Their current positions, their state of operation or even their consumption of energy, items of the future will be connected to the internet and every relevant information concerning them will become available in real time. Your Coffee machine will know when you need your coffee, your smart car will interact with other ones to avoid accidents and make self-driving car a reality (tesla is giving us a first taste) , your smart watch will transform your body signals in electronic information allowing you to manage your health your sleep and your activites. Basically, every goods we produce, every accessories we use and every items we interact with will be connected between themselves, will communicate together and with Big Data be globally and algorithmically treat to increase the efficiency and the sustainability of such a giant Internet of Thing. This smart network could even become a tool smart enough to autonomically regulate himself their components in order to make Internet a Platform useful to make every thing connected to it more efficient, environmentally sustainable and economically reliable. As we could imagine, this capacity to regroup information within a single smart network will bring out relevant way to change sales and operations planning for companies. Let us therefore figure out how such a connected environment could make S&OP more efficient, more suitable to various situations and more sustainable for companies.

Let us take the example of a lamp manufacturing company. To craft lamp and sell them, the company has to use different machines and many processes to finally craft the final product and stock them pending orders. Then, once lamps are bough and delivered to the final consumer, the company have to ensure each sold item works correctly and otherwise fix deficient products to satisfy the most its consumers. This is the classic scheme of traditional sales and operation process currently applied by most of companies around the world. Obviously, the emergence of the IoT will critically improve this process making information related to each part of this process available in real time and, thanks computer always more perwerfull, likely to be informaticaly analysed and imporved. Indeed, for the first manufacturing part, smarts machines will provide information about their productivity, the energy they need to work and even signal eventual dysfunctional. This various information makes companies omniscient upon their activities involvements and allows them to better organise operations. Thus our lamps will be craft with less energy, reducing their marginal cost. For the sales process, the Internet of Thing will radically change the way we use stocks. With Big Data related to every items being part of the process, sales forecasts will be more precise and relevant, making stocks more suitable for correctly forecasted sales and making our lamp production suitable to the market it reaches. That should make us able to better manage stocks and avoid waste due to over production or profit loss due to under production. Finally, the IoT could turn out being especially useful concerning the product follow-up. If by the past, or still today, we have to call after sales services to fix a problem like a lamp that flashes instead of illuminate, with the Internet of Thing, the companies which has produced these lamp will know in real time the general state of each lamp out of the manufacture. That means that when you will face such a dysfunctional, an electronic information precising the nature of the dysfunctional will be instantly sent to the company’s computers. Then you will just receive an E-mail (even perhaps before you see the problem) specifying that you have that or this problem and indicating how to fix it. Of course all these electronic processes will be automatized and will therefore extremely reduce S&OP costs.    

To conclude we could say that the Internet of Thing is at its very beginning. Each day connected items are created and each day we find applications justifying to connect traditional former items. For many, the IoT could be the revolution we need to live more sustainably, to craft smarter and to collaborate more efficiently in the new collaborative age which profiles at the horizon. Concerning S&OP, IoT promise to be a crucial and ultra-useful tool to improve each steps of processes. Future takes place and the Internet of Thing could well turn out being the basis for the next industrial revolution. To follow … ! ?