Perfect intersection: M2M and the supply chain

There’s really no such thing as an “un-connected” supply chain. The ability to know the location and status of goods and component parts is a necessity for today’s manufacturers, which are more than likely to have a manufacturing plant on one continent, parts providers on another and retailers or distributors dotted around the globe.

Decades-old supply chain applications from vendors like SAP or Oracle help manufacturers keep track of those in-transit goods, as well as help run the business and manufacturing processes that rely on their well-timed arrival and departure. But the actual tracking of those goods has most often been a batchy, non-real-time and at times erratic endeavor. Scanning technology and advances like RFID and short-range radios have helped, as has the ability of the Internet to speed and make more ubiquitous the exchange of data between nodes in a supply chain.

But even then, goods are all too often “lost” en route – disappearing if only for a few hours or days, if not at times for good due to theft – limiting or at times crippling the effectiveness of global supply chains.

“Supply chain management is the next big growth area of M2M,” predicts Roger D. Dewey, CEO and managing member of M2MV, an M2M strategy consulting firm. Essentially, says Dewey, M2M-enabled supply chain services are an extension of an already proven application: commercial fleet management. In that solution, trucking companies use technologies like GPS and cellular modems to track the progress and driving habits of their drivers – not to mention helping secure vehicles from theft and high-jacking. But as cellular costs decreased, new applications became possible.

“Now that the ROI for wide area connectivity is justified, it is an incremental step to expand the application to supply chain management,” Dewey said. Rather than just track trucks, companies can attach short range technologies like RFID readers and Zigbee (small digital radios) nodes to the cargo itself – and then further link them via M2M technology and wireless networks across the wide area. Those links help to secure the proper loading and unloading of cargo as well as “provide the status of your inventory no matter if it is in a warehouse, a truck, or a ship,” Dewey said. “This information helps to make the supply chain and inventory management much more efficient. “

M2M-enabled supply chain applications are still in their infancy – but the ecosystem of players in this market is becoming clear. Opportunities today are often driven by M2M hardware makers – such as Cinterion and Sierra Wireless – along with M2M MVNOs, such as Numerex, Jasper Wireless or Kore Telematics, which resell wireless services and focus exclusively on supporting M2M applications. Also in the ecosystem are application vendors focusing specifically on M2M supply chain solutions, such as Procuro or Geotab. Finally, mobile operators – including AT&T in the US and Vodafone around the globe – are beginning to focus less on resale opportunities and more on supporting specific M2M customer applications – including supply chain management. Sprint, for instance, has been a long-time M2M player but in October launched a new emerging solutions business unit to manage industrial applications, including supply chain opportunities.