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Tweak the Supply Chain From Your Phone

Smartphones are getting smart enough to integrate supply chain data and make changes when you're on the fly.

It's the effect of a prediction made around 2002 by Roy Vallee, who retired as executive chairman from Avnet, the sponsor of this site, late last year. During that time in his Phoenix-based office, he told me mobile would become the next technology to drive demand for electronic components.

Vallee had the foresight to see mobile becoming the next major worldwide trend, but just how much change he imagined is subject to much debate. I'm not sure he realized the full impact to the supply chain, or that the brains to integrate data would live in operating systems and cloud-based apps, rather than software. Nor could he have predicted the need for a shrinking supply chain business model to accommodate a smartphone lifecycle of less than a year.

Some 1.8 billion smartphone units will ship this year worldwide, rising to 2.1 billion by 2017, according to Gartner. The real excitement has nothing to do with the amount of smartphone shipments. It all comes down to the estimates that a whopping 40 percent of mobile applications will tap into cloud back-end services by 2016.

Automation will support this change. In a recent post, Jennifer Baljko points to analysis from PriceWaterhouseCoopers that discusses cognitive processing in OSs and apps. PwC defines this as “contextual awareness,” the ability for a mobile device to infer intent by understanding a user's relationships to people, places, objects, and information. The technology already exists in Google Android operating systems and Microsoft Windows OS, supported separately by Google’s Knowledge Graph, and Microsoft's Santori, respectively.

Knowledge Graph and Santori are massive databases with cognitive learning capabilities that identify contextual awareness. The technology connects things based on physical relationships. It supports push technology, automation, and location-based services based on data from the components on the device, the geographic location or surrounding environment, and the needs of users. The technology could make smartphones and supply chains a lot smarter.

Here are three real-world uses that make the most of these capabilities:

  1. Bridge language barriers and educate each other, so procurement and IT can build mobile apps based on a common understanding of what's possible. Do it by asking questions. A significant amount of mobile application design and development will take place in procurement, but buyers and the company's chief procurement officer don't always know the available options. Managing inventory may require multiple views, for example, but buyers might find the small screen impossible to use, so preset criteria and automating processes from mobile devices could become the answer.
  2. Design systems, such as bidding and replenishment, based on mobile alerts and push-pull technology supported in the cloud. Analytics and visibility will become critical because of the screen size. Pull in data across the enterprise, so the system can make the most reliable decisions. Automation that identifies and calculates material shortages or categorizes suppliers would take the place of manual tasks. Base automated bids and procurement on a scoring system, current and historic data, as well as material shipping and delivery times. The fewer clicks required to accomplish the task, the easier the app becomes to use. These platforms are new to the electronics supply chain, but they are not new mobile business applications. Companies in the online advertising industry, including search, have built mobile applications that analyze bids based on dozens of criteria before serving an advertisement on a publisher's site, such as EBN. In the online advertising word, it takes about .02 milliseconds to determine what ad and where to serve it.
  3. Create a framework for emerging mobile technologies and risk-based reporting infrastructure. Google Now, which serves information to the user before he/she realizes its importance, will become the fodder to change the supply chain. The technology searches the smartphone's calendar, historic searches, location, and patterns to determine the information it should serve up to users. That type of technology makes the smartphone smarter, enabling it to tweak the supply chain before you know the task is required.

Vallee had vision and foresight about the power and promise of mobility for the supply chain. Get out your crystal ball and let us know how you see this trend evolving.

36 comments on “Tweak the Supply Chain From Your Phone

  1. SP
    June 25, 2013

    Agreed smartphone can be a essential tool for supply chain industry. People who are always busy and work long hours, smartphones is kind of life saver. So many things you can do from your smartphone without having to get out of your car or cabin or home. Slowly smartphone is becoming a necessity rather than being a luxury. Designer, buyer and component engineers can just chat on skype. If there is a critical replacement and immediate approval is needed, smartphone can always assist that.

  2. Laurie Sullivan
    June 25, 2013

    BlackBerry just released the Q10, which offers a feature called Balance. I never thought I'd say this, but I'm thinking about switching from my iPhone back to the BlackBerry, if it can demonstrate an open architecture  that provides better search and social features. Balance separates the business apps from the personal apps. I have not had a chance to try it out, but with the whole BYOD movement in business I'm curious to know how folks and companies think about this model. Any thoughts?

  3. Tom Murphy
    June 25, 2013

    Smartphones are only as good as their connectivity and apps.  The apps, as Laurie points out, are coming along nicely. But the connectivity is a problem in most of the world, including many US cities where networks are so overcrowded, they can make even a 4GLTE phone owner wish for a hard-wire connection.  Some business processes are generally too important to leave to such risks.

  4. Tom Murphy
    June 25, 2013

    Laurie: I admire your openness in considering a blackberry at this point.  I like the idea of the balance — it is an appropriate response to BYOD, as you suggested.   I'm actually looking at a Windows phone, again, although I swore I would never do that again.   I do so much in Office apps that a Droid Windows-like app really doesn't cut it for me or my fellow editors.

  5. Tom Murphy
    June 25, 2013

    While I'm a believer in the potential of big-data and predictive analytics, I think we're currently seeing some pretty spectacular flops that serve as a caution for the future.  Right now, for example, Facebook's vaunted highly targeted advertising seems to have me pegged as a single, Christian lesbian who is eager to date — none of which is accurate.  So I'm not sure I really want Google analyzing my datebook, recent posts, emails and more and then deciding what kind of content to push my way.  I've always enjoyed the serendipity of turning the pages of a newspaper to see what learned editors think are the important events of the day; Google News has proven to be a very poor substitute for that.

  6. Ariella
    June 25, 2013

    @Laurie  Wwhat about the availability of apps? Whenever I see something about a new app, it always is for iPhone. Sometimes the announcement says that an Android version is also in the works, but that does little to assuage the grumbling Android users. Certainly, I don't see any mention of making these apps for a Blackberry. 

  7. Laurie Sullivan
    June 25, 2013

    Google Loon might bridge that connectivity gap. Sounds crazy, but Google is testing a balloon-powered network that it hopes will give the entire world Internet access. he balloons travel on the edge of space to fill coverage gaps in Internet access. No Joke.  So, if you don't have cellular, perhaps WiFi.  http://www.google.com/loon/

  8. Laurie Sullivan
    June 25, 2013

    BlackBerry has a BIG job ahead of them. They are slowly building a developer network and the ability to install other apps on its network with help.

  9. Ariella
    June 25, 2013

    @Laurie I'll have to check that out. Thanks for the link.

  10. Tom Murphy
    June 25, 2013

    The Loon Balloon experiment is interesting and reminds me of Bill Gates' one-time fantasy of putting a web of satellites into a low-altitude orbit.  (That evolved into iridium, which failed.)    I hope the connectivity problem is solved in our lifetimes, especially in poorer countries where it could make a real difference.  But I am not holding my breath.  I heard all the Information Superhighway promises of the mid-90s, and most are still far beyond the horizon.

  11. Lavender
    June 25, 2013

    In fact, mobile supply chain is being created as the continuous prices cutting of smartphone enables everyone of one. When a company achieves internal automated information sharing, supply chain including order handling, production tracking and shipment will be much easier?

  12. prabhakar_deosthali
    June 26, 2013

    It looks like ,the Big data, the associated analytics, the all encompassing fast internet and the plethora of the smart phones along with their apps are going to automate the whole decision making process in the supply chain in the near future.

    I am just wondering where do the line managers and purchase people fit into this scenario .

    They will be just following the orders given by the “System”?

  13. Ariella
    June 26, 2013

    @Tom Balloons are usually a bit unstable, though I suppose they have a plan to counteract that. The goal is not just to bring internet to places that don't have it but to keep people online when the usual link is knocked out. That's something that may become necessary as more and more superstorms leave people without power or cell connections for days.

  14. Tom Murphy
    June 26, 2013

    Ariella:  I've gotta say, I don't think the balloon thing will work as well as its supporters are arguing. But I applaud the fact that they are trying something new to answer a long-standing riddle.  Maybe this will lead to more ideas, or at least new questions, even if it is only a 10% success.

  15. Tom Murphy
    June 26, 2013

    Prabhakar:  You ask a good question: What happens to people when machines make the supply chain decisions?  Well, first, I don't think machines will make the decisions, but will merely recommend solutions. People will still make decisions. Second, the machines will be faster than the people who do the analysis now, and — if given good data — will be more accurate.  So those people will go.

    I think there are some similarities between employment in the supply chain and in the manufacturing sector 20-30 years ago.  AndI think we'll see a similar level of disruption.

  16. Ariella
    June 26, 2013

    @Tom I agree with you. I have serious doubts about it working, but it's nice to see attempts at innovative solutions.

  17. Tom Murphy
    June 26, 2013

    Exactly, Ariela!  We are so lucky to live in an age of such rapid innovation. I think of it as entertainment — I'm genuinely intellectually excited to think about the potential of the things that are being discussed all around us.  I don't know how much of this talk will translate into actual affordable goods and services, but I'm confident some of it will — and it's exciting to guess which part will.

    My biggest fear is that all this technology will only widen the gap between the rich — who can afford 1000 TV channels, every new cell phone, “the Internet of things”, and gas-less cars — and the poor, who can't afford a computer, don't have Internet access, and don't even understand what some of these advances do or how they make life easier for those who have them.  To me, progress occurs when an invention helps everyone who wants it while reducing costs — thereby making it more affordable to more people and improving life for everyone. Radio, television, and phones did this until the 90s. Now you must have cable TV that many people can't afford, mobile phones that even the middle class can barely afford, and radio — well, it's still there, but falling apart.

    Who will control the supply chain from their phones? Not the people who currently put in a long day's labor on a dock in Southeast Asia or the factory worker who makes pennies making phones worth hundreds of dollars.

    I hope the balloon floats over those poor people and gives them something that most of us now take for granted. 

  18. ITempire
    June 26, 2013

    If every year 1.5 to 2 billion smartphones are being shipped, that means that every 2 years, a human being changes its phones (keeping in mind that the phone user population is 3 billion out of 6). Consider the lucrativeness of the manufacturing of smartphones and development of enterprise and personal use applications for smartphones.

  19. ITempire
    June 26, 2013

    @ Laurie

    For Blackberry it will be a really difficult job to come back up. Now when, its primary users, the corporates, have started to shift towards BYOD hence iPhone and Android, Blackberry is making efforts to build up a developer network of apps. Can't think what would it take for Blackberry to make its way back up when Android and iOS are getting powerful and Microsoft is banging the door for its entry.

  20. hash.era
    June 27, 2013

    Im not sure about the speed of it if you try to use it from your phone itself. Any idea ? Also what are the phone requirements needed for this ?    

  21. Adeniji Kayode
    June 27, 2013

    @WaqasAltaf,

    I certainly agree with you on that. Blackberry may have to do more that its doing right now to succeed the present market pressure from both Android and iOS.

  22. prabhakar_deosthali
    June 29, 2013

    Tom, regarding your comment on how poor people are getting the benefit of the latest , I would say that as the newer and newer technologies are pushed to the upper layer of the market segment ( the elite customers), the established technologies get cheaper and percolate down to the next lower level in the society as the prices become affordable.

    Just 10 years back in India a Cell phone ad in a newspaper will show some chairman of a company holding it proudly standing outside his Mercedes car.  Today I see the maid servants in every household carry some kind of a mobile phone in their hand.

    In India's slums where poorest of poor live , you will say those tiny DTH dish antennas mushrooming on almost all roofs of those shanty habitats.

    So, though food may be costly, the water may have become scarce , but the technology is becoming more and more affordable.

  23. ITempire
    June 29, 2013

    @ Adenji

    Are organizations in your part of the world still inclined to use Blackberry or have they shifted to BYOD hence iPhone and Android ?

  24. Susan Fourtané
    June 29, 2013

    Prabhakar, 

    “So, though food may be costly, the water may have become scarce , but the technology is becoming more and more affordable.”

    There is plenty of food-for-thought in that sentence. It makes you wonder about priorities, about needs, and about how basic needs like food and water are not yet available to everyone on the planet in this day and time when so much it is spent on a daily basis on space exploration, wars, and other things.

    Maybe offtopic, but I couldn't help to have this thought now. And I am not saying that there is no need for technology or space exploration. I am only saying there is no balance, and in a certain way no logic. 

    -Susan

  25. Susan Fourtané
    June 29, 2013

    Waqas, 

    Yes, two years is the average time the majority of the smartphone users change their phones. This is why recycling is of importance to the supply chain. 

    -Susan

  26. Tom Murphy
    June 29, 2013

    Prabhakar: So true! And it has been this way for a long time with technologies.  When I was a lad a half century ago, only about 80 percent of American homes had telephones. That went up to near 100 percent by the 1980s. Today, almost all US homes have mobile phones, although there is still extensive poverty in America (yes, really, there is).

    My preference would be that it doesn't take a decade for basic technologies to trickle down to the poor.  Surely, we can make it a priority to ensure that everyone in the world has enough to eat, a roof over their heads, sanitary conditions, and enough technology to stay connected with the world.  That's to say we should or could wipe out the gap between rich and poor, just that it would be a better world if every started on the same level. And that is do-able.

  27. Tom Murphy
    June 29, 2013

    Susan: My take is that the two-year cell phone life span stems from the fact that many of those phones are tied to two-year contracts by mobile carriers.  (In the US, that's the way almost everyone gets a phone. The exceptions mostly use “disposable” phones, which is worse).  

    My point is this: Maybe we could change the useful life of phones by changing the way they are sold.  The current system encourages people to dump their phones after two years. I admit, I've done that a number of times.

  28. Tom Murphy
    June 29, 2013

    Its's not at all off-topic, Susan. The supply chain certainly would benefit financially from the notion that everyone should have basic technologies, and that surge in mobile technology would be a boon to making new technology available to the supply chain, too. Hence, it might get even easier and more accepted to use a phone to control business processes, including supply chain elements.  See: The world is all interconnected. A man starves in the Sudan, and the supply chain suffers.

  29. ITempire
    July 1, 2013

    Susan, recycling the phones ? That is a new concept for me. Are manufacturers doing it ? Apparently it doesn't seen that way as people seem to throw away the phones when they have made use of it.

  30. Susan Fourtané
    July 5, 2013

    Waqas, 

    It seems like you have missed all my articles about recycling electronics. 🙁

    If you go and read them, you will find a lot of interesting information about recycling phones, and all the other devices, about how manufacturers are doing in the career of becoming greener, and what happens with eWaste. 

    But yes, companies like Nokia, and Apple, and others have links on their Website where you can find out how o recycle your electronics. 

    Here, you have to catch uo with five articles about recycling, and you find all the answers to your questions there. 🙂 –> http://www.ebnonline.com/archives.asp?section_id=1364 

    -Susan 

  31. ITempire
    July 15, 2013

    Susan, that's impressive news for me. Impressive not only from the point of view of environmental awareness but also that the cost of the manufacturing of the corporations will go down because new material is expensive than the recycled on.

    Thanks for the link Susan. Will read them.

  32. Susan Fourtané
    July 18, 2013

    Waqas, 

    I'm happy it can be a usuful reading. 

    Well, recycling electronics has been going on for quite some time now. I am not sure if recycled materials has lowered manufacturing in some way. It makes sense, though. 🙂 Maybe I have to continue investigating. 

    -Susan

  33. SunitaT
    August 1, 2013

    Mobile provides a continuous connection to your operation. Your role in your supply chain will not be restricted by location or time of day – you can tap in at any moment from anywhere. Social allows a network of people to connect and communicate in real-time to manage a supply chain. It is people that manage a supply chain, and social delivers the platform for all these people to connect in a single place.

  34. Anand
    August 2, 2013

    Most apps are free and data exchange and incorporation of the exchanged data will lessen the costs of operation. The shrinking model of business is the welcome change that is going to direct markets in the future.

  35. Anand
    August 2, 2013

     Using technology like this will prove beneficial to markets, as the
    article explains, the language barrier would be removed, and you can
    control the supply chain from any part of this world, and if a mistake
    occurs, it can be debugged without risking a timeline crunch for the
    supply chain.

  36. Anand
    August 2, 2013

     Smartphone market has been flooded with apps that help pass the
    information quickly and effortlessly. The supply chain already
    facilitates electronics for the smartphone industry. This ''help and
    be helped'' relationship is very crucial.

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