How will 5G affect the supply chain?


Wireless technologies have already revolutionised supply chains. But when 5G makes connectivity faster, more responsive and more agile, will it represent an upgrade – or a gamechanger? And which areas of the supply chain will be the most heavily impacted?

Better Network Management through Better Connectivity

5G’s improved network capabilities will enable organisations to transfer large amounts of data at high speeds with low latency. Using much higher radio frequencies than 4G, 5G allows data to travel faster with reduced congestion and fewer delays.

The upgraded network is expected to support around one million devices per square kilometre. To put that into perspective, 4G’s capacity is 4,000 devices per square kilometre. With tomorrow’s mobile networks set to be 250 times more powerful than today’s and Ericsson predicting that billions of devices could potentially be connected, this is set to prove a tipping point.

The exponential growth in devices on the network will also lead to greater data availability. With all items labelled, tracked and recorded automatically, managers will be able to enjoy a real-time view of their supply chain and take proactive steps to avoid shipment delays or losses.

Improved IoT Devices and 5G Connected Sensors

This dramatic increase in connected devices and sensors represents a phenomenal opportunity to gather real-time data insights from connected IoT devices and sensors. Heat, humidity, location, volume… the sheer volume of data could prove to be overwhelming. To ride the wave of innovation rather than drown beneath it, supply chain executives will need the tools to transform numbers into better decisions.

5G will support the growth of connected devices, and innovative early adopters are already delving into Industrial Internet of Things (IIoT) solutions. These include Artificial Intelligence (AI) robotics and connected equipment for warehouses and Customer Fulfilment Centres (CFCs).

Last year, Honeywell introduced connected machinery in its Japanese facility to improve operations and machine downtime, stating warehouses and distribution centers using 5G will allow faster updates and access to more computational power for myriad industrial and warehouse-centric use cases.

The data-generating capabilities 5G supports are enabling traditional warehouse and logistics partners in the supply chain to transform themselves into technology companies. Ocado Technology and Amazon are other examples of leaders investing heavily in IIoT solutions to improve operations. This has demonstrated to be increasingly effective on the factory floor, where 5G networks can support managers, better monitor quality, increase speed, respond to supply fluctuations and simplify workflows.

Low Latency, Tracking and Location for Inventory Management

As a result of 5G, more organisations are investing in IIoT solutions to address the challenge of visibility at scale. Previously, 83% of supply chain executives believed a lack of end-to-end visibility in their organisation was a barrier to growth. With sophisticated IIoT devices capable of Machine to Machine (M2M) communications, those same executives can address the lack of transparency in the supply chain and leverage reliable, real-time data to improve planning, execution and reporting.

Identifying the value of the data available is key to building supply chain transparency, as the real-time data generated from these connected devices, can feed information into supply chain management solutions to improve operations. With 5G’s low latency, inventory can be seamlessly tracked and located, enabling near real-time changes in logistics and transportation management to enhance availability whilst driving down stock levels.

5G and data

Data has recently overtaken oil as being the most invaluable commodity. 5G will provide the engine to power the IIoT revolution. This is a revolution no enterprise can fight alone: with ecosystems growing increasingly complex, organisations must invest in smart solutions to feed vital partner information from connected devices into their supply chain management solutions and back into the channel. 5G is not just a buzzword. It is a gamechanger that supply chain executives must leverage to emerge as leaders from the Fourth Industrial Revolution. To do so successfully, they must arm themselves with the tools to identify the data that matters, when it matters, and convert it into knowledge, actions and improvements. That’s when supply chain executives establish the End-to-End Visibility their organisations require. Otherwise, they are set to be overwhelmed – and underperform.