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How the Internet of Things is Revolutionizing Logistics

Cisco and DB Schenker Revolutionizing Logistics with IoT

DB Schenker and Cisco collaborate to explore the role that the Internet of Things (IoT) and advanced technologies can play in streamlining logistics and supply chain.

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With e-commerce, omni-channel distribution, and changing customer demands all pushing companies to streamline their supply chains and enhance their logistics operations, we’ve been hearing a lot about the role that the Internet of Things (IoT) will play in this evolution.

Defined by Gartner as “the network of physical objects that contain embedded technology to communicate and sense or interact with their internal states or the external environment,” IoT could revolutionize the supply chain environment by enabling better asset tracking, improving inventory management, and maximizing labor, among other things.

These benefits aren’t lost on the companies that need them to survive and thrive in today’s competitive business environment. In 2015, there were about 15.4 billion connected devices. According to IHS, this number will grow to 30.7 billion in 2020, and 75.4 billion by 2025. In 2016, global spending on the IoT across markets was $737 billion, and IDC predicts that by 2020, this number will reach $1.29 trillion—a compound annual growth rate (CAGR) of 15.6 percent.

“IoT has the potential to [transform] logistics decision making processes,” IoT security provider barbara points out in How IoT Is Disrupting Logistics,“as well as the way goods, are stored, monitored, transported, and delivered to the customer.”

Changing the Logistics Industry

To explore how IoT applications and related technologies can be used in the warehouse—and across logistics networks—Cisco and DB Schenker are working together on a series of innovation lab tests. Their end goal is straightforward: Figure out how IoT and related digital technologies can help to improve everything from warehouse operations to logistics networks to the end-to-end supply chain, and everything in between.

The two companies are collaborating to test, and implement various applications around the Internet of Things and other innovative technologies for logistics. DB Schenker, which is one of Cisco’s logistics providers, set up a 25,000-square-foot lab in one of its Texas warehouses. There, the two partners are experimenting with IoT sensors, real-time location tracking, and other innovations in a “real” distribution setting.

Operational since early-2017, the lab has already served as the proving ground for four technologies (energy management, facial recognition, augmented reality, and pallet dimensioning), out of a total of fifteen. Other cutting-edge technologies being tested include sensor-based solutions; real-time locationing system; robotics and automation; smart devices; and video analytics.

Developed by Cisco and DB Schenker, these applications and products are thoroughly tested by the latter’s employees in a warehouse environment. During the trial phase, the team assesses both technical feasibility and the value proposition within a warehousing and supply chain environment.

Leveraging the Digital Supply Chain

Philippe Gilbert, Chief Executive Officer, DB Schenker Region Americas, says these and other activities that spur from the collaboration will help advance the use of IoT in logistics, and help companies leverage the power of the digital supply chain. “Digitization will change societies, and therefore logistics,” Gilbert said, “thus changing the way we move, store, and secure goods around the world.”

Working in collaboration, DB Schenker and Cisco believe that the changes in transportation, warehousing, customs, and last mile delivery are massive, pervasive, and are already altering the way both companies do business worldwide. “We want to drive this transformation together,” Gilbert added, “and continue leading innovation in our respective industries.”

Philippe Gilbert on IoT Cisco collaboration

An Explosion of Smart, Connected Things

Worldwide, we are witnessing an explosion of ‘smart, connected things’, exploiting technological advances and reducing costs in telematics devices, sensors, applications, software and communications networks – including cellular, satellite, and near-field, according to FreightWaves.

“IoT connectivity is now being actively adopted on a growing array of transportation assets, enabling users to track not just in-transit and geo-fenced locations at any given time, but also the actual status of both asset and cargo,” the publication reports, “from loaded vs empty, internal temperature/atmosphere, shock, motion, fuel and oil levels, to tire pressures, door open/close, device on/off, tampering/intrusion and more.”

Going forward, Cisco and DB Schenker plan to continue testing out IoT and other advanced technologies in warehousing and logistics. “We’re thrilled to be collaborating with Cisco on IoT and digitization for logistics,” Gilbert says. “This work has allowed us to determine how certain new technologies can be developed to dramatically change the way we do logistics and supply chain.”

Stay tuned as DB Schenker and Cisco continue their collaboration and explore the role that IoT and advanced technologies can play in streamlining logistics, thus enabling a simplified end-to-end supply chain experience for shippers, customers, carriers, and logistics providers alike.

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