Internet of Things to Reach 26B Installed Units By 2020

Computer Reseller News India

March 28, 2014

According to Gartner, the Internet of Things (IoT) will reach 26 billion installed units by 2020, up from 0.9 billion five years ago.

"It's important to put IoT maturity into perspective, because of the fast pace at which it is emerging, so supply chain strategists need to be looking at its potential now," said Michael Burkett, managing vice president, Gartner. "Some IoT devices are more mature, such as commercial telematics now used in trucking fleets to improve logistics efficiency. Some, such as smart fabrics that use sensors within clothing and industrial fabrics to monitor human health or manufacturing processes, are just emerging."

As these capabilities become mainstream, they will allow modern supply chains to deliver more differentiated service to customers more efficiently. This will happen when many more physical assets than today are communicating their state to a networked ecosystem that then formulates an intelligent response.

The future explosion in the number of intelligent devices will create a network rich with information that allows supply chains to assemble and communicate in new ways. According to Gartner, a 30-fold increase in Internet-connected physical devices by 2020 will significantly alter supply chain leader information access and cyber-risk exposure.

The research firm said that a double-digit increase in digital marketing investment will provide supply chain leaders with deeper market insight. Digital marketing budgets are expected to continue to increase in 2014. A rapid move to digital marketing has direct implications for the supply chain, particularly for consumer product industries with rapid cycles of go-to-market and promotional activity. B2B industries adopting digital channels to reach customers will also be affected.

"Supply chain leaders must design their processes to operate in this digital business world," said Burkett. "This includes fulfilling the new expectations of customers and the volatile demands that digital marketing will create. A future supply chain will meet those expectations by converging people, business and things in a digital value network, and incorporating fast-emerging capabilities such as IoT and smart machines into this design strategy."

Digital business will also disrupt the design and manufacturing of products during the next five years. First will be the use of digital product models for use in 3-D printing (3DP) and for simulating hybrid digital-physical software-embedded products, Gartner said. The promise of 3DP is to achieve supply chain bliss by postponing a product's manufacture to the latest point in the supply chain. If 3DP delivers on this promise, it would disrupt entire supply chains by responding only to actual demand, thus eliminating excess inventory and plant capacity.

The second disruption will be the process of designing embedded software into physical products so they participate in an intelligent network to add value to a digital business.

"As the number of software-embedded digital-physical products grows, the methods of product development and life cycle management across the supply chain will change," said Burkett. "Supply chain teams will have to take ownership for coordinating the delivery of quality-perfect orders of these digital-physical products. This extends beyond developing and ensuring quality of a single device to managing the larger complexity of these connected systems."

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