According to the consulting firm McKinsey,Â the economic impact of the Internet of Things (IoT) could reach USD$11.1 trillion by 2025. Â Something very big is clearly happening – but what exactly does this mean for the food supply chain and disciplines like food safety? Are opportunities being grasped, or is there more work to be done to turn potential into reality?
Key research findings:
- When it comes to IoT, organisations are going to need to communicate and collaborate more freely with other organisations across the food supply chain to reap the full benefits. Â
- There is a strong need for line of business personnel to learn more about what the IoT can offer in, and beyond. their sphere of work. Â This does not require a complete, in-depth technical knowledge, but they do need more understanding to see where the true business value lies.
- Third parties have a lot to offer, particularly those who specialise in provisioning secure public cloud platforms and data analytics. Â
The research was designed to gauge the perceptions of the Internet of Things (IoT) across the entire food supply chain. Â The findings were generated by interviewing 400 people responsible for food hygiene and pest control in Australia, China, the UK and US, covering arable farms, logistics and warehousing, food processing, and retail outlets. Â The results made for some very interesting findings.
Where we are now
Overall, the research shows that organisations involved in the arable food supply chain have a good awareness of the issues that they will face going forward, especially considering the growing demand for food and the need to reduce food waste. Â
However, there are gaps in understanding over the types of automated solutions already in use.
This is partially due to the fact that some automated systems are not viewed as â€˜IoTâ€™ systems, such as GPS systems in the truck or in-container monitoring systems. Â Similarly food processing control systems are not perceived as â€˜IoTâ€™ enabled devices â€“ they are just part and parcel of the processing line itself.
Perhaps for this reason only a few respondents stated that their organisations were already using the IoT in a big way. Similarly, a small number saw this changing greatly over the coming 12 months. This was against a base where over one third stated that they had little to no knowledge of the IoT, with just over a quarter stating that they had a deep knowledge of the subject (see figure 1).
Where we need to head next
One of the main conclusions we drew from our analysis of the research is that in order to bridge this gap in understanding, the industry is going to need to encourage much higher levels of collaboration.
This will require line-of-business and IT staff within companies to work closer with each other and also to cooperate with the different constituents in the food supply chain.
The industry will also need to engage with third parties that can bring domain specific expertise to the game, such as data security.
This should facilitate the sharing of data and ideas to help optimise food safety and minimise food waste across the whole chain. Indeed, the main value from automated systems will be realised by pooling all available data from all areas of the supply chain so it can be analysed in context. Â If this does not happen and the IoT systems are implemented as a self-contained insular environments, the results will be sub-optimal.
Another clear conclusion from our research is that to make the most of IoT and to share data in the way described above, the use of public cloud systems is going to be key.
This will benefit the data storage, management, analysis and reporting requirements. Â It will also ensure that data is standardised, making it far easier for analysis, documentation and reporting.
Another benefit of using a public cloud is that the provider will be duty-bound to the entire food supply chain â€“ not just one organisation â€“ and as such be in a position to provide a full, impartial and transparent service, while maintaining the required levels of data security.
Our research also reveals that there are still barriers to overcome, however. Â The findings suggest the industry is still sceptical about public cloud computing platforms (see figure 2), and their biggest concern lies with data security.
Quocirca has covered the topic in depth, and it is our view that this concern is no longer really valid. Indeed, we believe that those providing public cloud based services are best placed to be at the forefront of critical issues such as security, making them core to their business.
The associated costs can be shared across their entire customer base, making suitable security in the cloud far more cost effective than the same levels of security any company can achieve with a privately owned facility.
Towards a brighter future
Once it is accepted that cloud computing can be a safe platform for sharing data, organisations in the food supply chain will be better prepared to fully embrace the IoT. For example, they can consider bringing in advanced hygiene and pest control systems that use advanced analytics alongside data from general automated systems to better address the needs for compliance and overall food safety.
If this data is stored alongside other IoT data, such as that created by sensors in food storage and transport, the whole food supply chain can benefit from new insights and new learnings. Ultimately, these learnings could shape the way the industry manages compliance and improves overall food supply chain transparency in the future.
The key for those involved is to take small steps in this journey. Â The first step involves the identification of companies that you can benefit most from collaborating with. Â The second involves pinpointing high priority areas within your own organisation that could benefit most from IoT systems and data. By taking this route, organisations stand the best chance Â of implementing IoT systems that will provide the best return on investment.