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Of Leafy Greens And Integrated Technology

Oracle

By Lyle Ekdahl

Last week, I brought home a large container of baby spinach, looking forward to fixing a nice, large, flavorful tossed salad. I am eating lean and green these days. Alas, as soon as I opened the container, a damp, just faintly rotten smell hit my nostrils, and I could only think, “Uh-oh. Here we go again.” I’d been here before, bringing home a container of leafy greens packed so wet that they started decomposing en route from grower to market.

I don’t know about you, but that’s about the time when I fervently wish for stronger ERP systems that integrate Internet of Things (IoT) technologies. Say what? Isn’t that a bit of a leap—from a humble box of produce to big technology topics that are—or should be—keeping business leaders awake at night and are scrutinized and analyzed daily on business and technology forums everywhere? Well, yes, it has everything to do with it. Let’s look at how and why.

The Internet of Things—variously known as the Internet of Everything, the Industrial Internet, or by its acronym IoT—is quickly becoming the next frontier in technology and business development. Many companies are exploring how to exploit a technology that allows them to capture, transmit and analyze an unprecedented amount of data, much of which was trapped in propriety operational systems. More importantly, they are looking for ways to use this data to improve or even radically change their business, and to combine operations technology with information technology to learn something new.

The disruption and potential of IoT is about to hit every sector of the economy. Not that this is a definitive exegesis, but some observers go so far as to divide companies into the proverbial sheep and goats—those who see and explore what the Internet of Things can do for them, and those that are ignoring it.

About a year ago, Bob Evans, Oracle senior vice president and chief communications officer, threw down the gauntlet on this forum. He predicted that the disruption caused by the Internet of Things will leave clueless businesses unable to meet the demands and expectations of their markets, but will hugely benefit companies that recognize an opportunity when they see it.

This challenge is real and, if anything, has become more urgent since Evans articulated it. Yet deploying an IoT strategy poses a range of challenges, at least in the near term. Many organizations are working hard to collect the kinds of data that they need to resolve long-standing business problems. For example, a recent InformationWeek article reported that the biggest challenges businesses face in the age of IoT may not be data analysis, but the ability to gather the right kinds of filtered data in a timely fashion—and to integrate all their systems so that they’ll truly get a complete and easy-to-visualize picture.

The same is true for a company’s internal operations and ERP. If a business deploys a range of monitoring devices to improve quality or efficiency or some other objective, but the data from those devices doesn’t easily feed into the company’s ERP systems, quite a bit of potential analysis and insight is lost.

Which brings me back to my wet spinach. What does the IoT and ERP have to do with my ruined dinner? The thing is, it’s not just my problem. The spoilage cost of perishables may be as high as $35 billion a year worldwide. What if the company that packaged the spinach had monitors throughout its supply chain, continually gathering and transmitting data on the humidity levels in the containers? Rising humidity levels could trigger adjustments to warehouse climate controls. Once the produce is dry enough to allow delivery of the produce to the retailer at peak quality, another trigger could initiate the loading process. This data could also be used to issue a quality guarantee to the retailer and ultimately to the consumer—me! Better yet, have the container communicate with my smartphone, “Pick me, pick me! I am at optimum quality for your spinach and goat cheese salad!”

This is just one tasty example of the power of tying together IoT with ERP systems and business operations. Granted, most grocery shoppers won’t make this leap. If the spinach they purchase is bad, they’ll probably decide to purchase another brand of spinach the next time they shop, perhaps discuss with friends their bad experience with this particular brand, or post their dissatisfaction to social media, where it will be exposed to hundreds if not thousands of people—the outcome the produce company wants to avoid.

But are ERP vendors prepared to help companies take advantage of IoT to gain a comprehensive view of operations across the business? To achieve this goal, an ERP system must offer the data storage capacity and processing power needed to extract, manage, store, and analyze the unending stream of data that results from all these data inputs. And an ERP system needs to be integrated across devices, functions, and geographical regions to give companies the insight they need to improve operations. Silos of data limit a business’ ability to analyze issues and alter processes in a timely fashion.

What opportunities does the IoT offer your business? And how could that potential be tied to your ERP systems across the supply chain, throughout the warehouse, in distribution networks, in inventory and asset management, and on the manufacturing floor? How could the data gathered from those areas affect HR policies, marketing strategy, operations and asset maintenance, customer service, and sales approaches? It’s easy to see how an integrated, connected ERP system that leverages IoT technology can be a competitive advantage.

I would surely like my box of baby spinach to be nice and fresh—and dry! Wouldn't you?

Lyle Ekdahl is senior vice president and general manager of Oracle's JD Edwards product family.