Technology can be cool, but it can also be practical if the features are practical for deployment in the real world. It’s important to innovate to disrupt—to create a competitive advantage. Industrial manufacturing is typically an outdated landscape for cool technology, but there is room for a low-cost, highly-reliable RFID system for managing complex supply chains.
If you want to keep things practical, that usually means keeping it simple. If you want to innovate inventory management, that means focusing on the big data that leads to a measurable return on investment.
Deployment of an RFID-based inventory management system leads to collecting accurate and granular consumption data that produces a lean inventory with no stockouts. Add to that a focus on four key “V” variables that drive value from big data—volume, variety, velocity, and veracity. They are self-explanatory, working together to drive value from your pile of big data, but one V is more important that the others when considering automated technology solutions.
Pay special attention to the veracity of your data. Having data that is accurate or true 97% of the time sounds great, but not when that data is intended to drive an automated system. Autonomous data-driven systems demand perfection. Your big data set better be near perfect in these scenarios to have any value at all.
Innovation Growth is Limited by the Growth of the Innovation’s ROI
An innovation’s market potential is limited by the continued expansion of ROI. The pursuit of ROI when it comes to innovations with regard to the Internet of Things (IoT) always returns to big data. RFID technology efficiently collects that data, and then the systems built around it mine the data. As you continue to innovate and expand your system, the ROI will expand. This leads to further innovation.
It’s possible to leverage consumption data to make the entire supply chain—from supplier to consumer—much more efficient, accurate, and effective. By collecting accurate, granular consumption data you can leverage that data to do all sorts of cool things in our world like automating sales order entry and generating accurate, live-item forecasts.
The largest ROI in the ShelfAware system resides at the supplier end of the chain. Once the RFID platform is installed at the consumer’s location, we can finally answer that key question, “When did they consume what?”
ShelfAware then moves horizontally through parallel product verticals, eventually automating the entire supply chain from nuts and bolts to hoses and gaskets. By starting with a laser-like focus on using an RFID system to automate the supply of one part, we can quickly automate almost any consumable inventory item.
With the collaborative use of Cloud SourcingTM, we can support multiple independent product vendors who collectively support large supply chains that are demanded by large or complex manufactures.
Three Steps to Take When Pursuing Supply Chain ROI
Again, innovation can be simple and practical. Here are three steps to take if you want to disrupt the supply chain and pursue tangible ROI.
- Define a Big Picture Strategy. Step back, take the 10,000-foot view of your manufacturing company and define some big picture objectives. Draw your finish line for the marathon you are about to run. Then prioritize technology improvements that work together toward those objectives. The thought of implementing some giant overarching technologically advanced manufacturing system is too daunting. There are a lot of bite size pieces of technology that are designed to stand alone and still offer a quick ROI. Some are literally plug and play, like ShelfAware.
- Hire an Outside Change Agent. An informed professional can act on your big picture innovation strategy. Give them the authority to start rethinking aspects of your organization and its processes. Change is hard. It takes a hard, discerning, strong person to enact that change. If you need to destroy some process, then destroy it and start over. Clean slate it!
- Don’t wait! Your competition has already started. This is the killer part about competition and capitalism. It’s like sneaking into your competitors’ house while they are sleeping and stealing the food right out of their refrigerator. That’s what we are doing with ShelfAware. Our biggest installation of ShelfAware to date is Energy Manufacturing, a hydraulic cylinder manufacturer in Northern Iowa. We walked into their facility off the street in October of 2016, not currently selling them a single item. In three short months, we took a million dollars in O-ring and gasket business away from more than a dozen competitors. That’s being on the right side of disruption.
The best innovations are win-win scenarios. Remember, a good innovation can disrupt an entire marketplace. Using RFID-based technology, ShelfAware monitored more than 600 SKU’s for Energy in one year, never stocking them out of a single item and with no production delays. It lowered their lead times to an industry best all while keeping their inventory lean and turning that inventory almost eight times. That’s a win-win.
That’s total supply chain disruption.
How Do I Get Started With a Pursuit of Supply Chain ROI?
Implementing ShelfAware’s robust platform is often complex but does not need to be slow. It begins with a group conversation involving a mix of finance, operations and IT professionals. A site audit (often multiple sites) is usually required before a proposal can be made.
Final proposals usually involve a formal stocking agreement, installation fee, and a product pricing quote. Onboarding consumers varies widely, but the minimum time required to convert a supply chain in most markets is about three months.
Want to learn more about an affordable way to automate your supply chain? Request your free ShelfAware demo
Too good to be true? ShelfAware is redefining the vendor-managed inventory industry. For this reason, we’re happy to talk to you about how our intelligent inventory platform can benefit your business. Contact us today for more information.
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