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:
- 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.
- 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.
- 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.