Supply Chain Information Technology

Impact of Internet of Things (IOT) in Automobile Industry

Instructor: Deepak Jakate

Name:

Syed Shahbaaz

GJAN17GL50

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Table of Contents
Introduction ............................................................................................................................................ 3
Literature Review .................................................................................................................................... 3
IOT (Automobile Industry) in Supply Chain Industry .............................................................................. 8
Conclusion & Recommendation: ............................................................. Error! Bookmark not defined.
Reference ................................................................................................................................................ 9

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Introduction

What Is The Internet Of Things?

A network of internet-connected objects able to collect and exchange data using

embedded sensors.

Basically IOT builds around three pillars:

1) Anything identifies itself

2) Anything interacts
3) Anything communicates.

In total, as per the forecast there will be 34 billion devices connected to the
internet by 2020, up from 10 billion in 2015. IOT devices will account for 24
billion, while traditional computing devices (e.g. smartphones, tablets,
smartwatches, etc.) will comprise 10 billion.
Nearly $6 trillion will be spent on IOT solutions over the next five years.

Businesses will be the top adopter of IOT solutions. They see three ways the IOT
can improve their bottom line by

1) Lowering operating costs.

2) Increasing productivity.
3) Expanding to new markets or developing new product offerings.

Literature Review

The automobile environment is changing rapidly all over the world due to the faster
growth of the Internet. As a result the automobile are forced to come up with more
innovative ways to interact with the customers. The rate at which the Internet is
growing, it is safe to say that in the next decade and further it will have a huge
impact in everyday life. The world will be home to billions of physical objects with
computing capabilities. Such smart objects would be an integral part of the Internet
of Things or IOT. With the advent of IOT, the degree of changes in the automobile

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landscape would be immense. The IOT has already begun to mark its presence in
various industries, and the whole supply chain processes would be subject to a
major disruption with the use of new technologies in the coming years. Innovative
technologies for selling goods and services are spreading fast, by making available
interactive and innovative systems supporting both customers and suppliers. IOT
delineates the new era of Internet, wherein objects will be accessible and identifiable
via Internet. The fundamental concept of IOT implies that the connected objects can
be distinguished distinctly in virtual representation. Each and every object can
communicate and interchange data, process and modify data according to some
predesigned techniques.

There is a growing need for technologies that increase interactivity (for instance by
using sensors), Secondly the availability of new advanced technology-based tools for
investigating market. The Demand of the hour is to understand and predict market
trends, furthermore they need the capability to quickly react to the external
environment when needed. Although there is some research on whether the
consumer would accept a certain technology, research from the employees
perspective is still very limited. Some researches recognize that IOT will especially
be disruptive to the automobile industry and expects that it will offer opportunities in
three critical areas: customer experience, supply chain and new channel and
revenue streams.

Today's Connected Smart Cars

In the last several years, connected cars have exploded thanks to the IOT. Currently,
automakers are connecting their vehicles in two ways: embedded and
tethered. Embedded cars use a built-in antenna and chipset, while tethered
connections use hardware to allow drivers to connect to their cars via their
smartphones.

How IOT Will Make Smart Cars Even More Connected

Automakers are ramping up their connected car efforts for several reasons. Internet
connectivity in vehicles allows car companies to release software updates in real
time, which is extremely important during a recall.

Second, automotive companies can use data from the car to analyze its performance
and obtain valuable data on how drivers use their cars. Finally, more connectivity
provides more ways for automakers to cross-sell their products and services to
customers

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So which automotive companies are leading the pack in this connected car push?
There is no clear winner, but several companies are setting the tone. BMW is the
champion, according to a KPMG survey of 200 automotive executives. Daimler,
General Motors, Toyota, and Tesla are also near the top of the list.

As far as tech companies, AT&T is a prime example. The telecommunications giant

added 2.7 million connected cars in the U.S. in the first three quarters of 2015. But
Microsoft, Apple, Pandora, Sprint, Google, and other tech heavyweights are all
throwing their considerable muscle behind connected cars.

And all of this effort will not go unnoticed or unappreciated by consumers. A recent
Google survey found that 30% of U.S. smartphone users get "anxious" without their
smartphone on them, and 68% check their smartphones within 15 minutes after
waking up in the morning. Connected cars allow people to stay connected more
frequently and remove that anxiety.

The government is also cracking down on texting while driving, a problem that
connected cars would solve by letting drivers keep their hands on the wheel and
their eyes on the road even as they communicate with others.

Consumer interest in the connected car is growing, and that will rapidly translate into
dollars. Approximately 62% of U.S. consumers were aware of the term "connected
car" in a recent AT&T and Ericsson survey. And Google Trends shows the term
"connected car" is reaching new highs every month. As a result, estimates say in-car
infotainment centers will generate $15 billion in sales in 2021, up from $7 billion in
2016

Power Struggle between Automakers and Software Developers:

The power struggle between automakers and software developers is a symptom of

the ongoing transformation. We are moving from an age of products to an age of
services and experiences, from hardware to software, from functionality to
information as the key object of value creation, and from industry silos to intricately
connected ecosystems and value loops. It is no surprise that carmakers find
themselves navigating new terrain within an ever-expanding ecosystem of players,
all of which are trying to capture value, and where players that control the
aggregation and analysis of this informationthe software providerssteadily gain
ground.

As automakers consider their place in this changing industry, they can consider
several approaches to strengthening their position:

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 Align on a vision of the role that the business will play in the ecosystem,
understanding and accepting the transformational impacts this may have on
the business and on the old ways of thinking.
Develop a clear mapping of where data originatesand, consequently, who
owns itfor each of the services delivered, to better understand where value
can be captured.
Develop a roadmap for shifting to a more service-oriented approach as an
entire organization, not just in the connected-vehicle divisions, to enable
ongoing interaction with customers throughout the entire lifecycle.

IOT Industries

Several environments within the three groups of consumers, governments, and

ecosystems will benefit from the IOT. These include:

Manufacturing Transportation Defense Agriculture

Infrastructure Retail Logistics Banks

Oil, gas, and mining Insurance Connected Home Food Services

Utilities Hospitality Healthcare Smart Buildings

IOT Companies

There are literally hundreds of companies linked to the Internet of Things, and the list
should only expand in the coming years. Here are some of the major players that
have stood out in the IOT to this point:

Honeywell (HON) Hitachi T-Mobile (TMUS) Comcast (CMCSA)

GE (GE) AT&T (T) Cisco (CSCO) IBM (IBM)

Amazon (AMZN) Skyworks (SWKS) Apple (AAPL) Sierra Wireless (SWIR)

Google (GOOGL) Garmin (GRMN) Ambarella (AMBA) Microsoft (MSFT)

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IOT Platforms

One IOT device connects to another to transmit information using Internet transfer
protocols. IOT platforms serve as the bridge between the devices' sensors and the
data networks.

The following are some of the top IOT platforms on the market today:

Amazon Web Services

Microsoft Azure
ThingWorx IOT Platform
IBM's Watson
Cisco IOT Cloud Connect
Salesforce IOT Cloud
Oracle Integrated Cloud
GE Predix

Drawbacks and Challenges for IOT:

Thread to data or physical security

Inability of the IT systems to keep up with the change
Regulatory challenges
Competition from new rivals
Greater price transparency/Lower Profit Margins.
Job Losses due to Outsourcing or Automations

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IOT (Automobile Industry) in Supply Chain Industry

If real time data is being shared from end to end of the supply Chain certainly it will
disrupt the supply in the positive way.

The amount of data available can utilized for various reasons and better and cheaper
products can be launched in the market.

The inventory can be management in a better way and the level of safety stocks
being kept at various distribution centers can be drastically reduced. As the real time
is being generated the number of location for DC can be cut down and can be
operated centrally.

Just in time deliveries of spares as per the required is achievable when the vehicles
arrive to the service centers.

Also preventive measured would be possible even before the vehicles breaks down
can be taken and would lead to lower cycle time.

Customers would also benefit from cheaper repair of cars as the cost of preventive
maintenance would be much lower the cost of repair.

Benefits of IOT in supply chain:

Distribution Network can be planned and management is a better way

Warehouse Management

Higher Visibility Across Supply Chain

Just in Time can be practice easily

Inventory control

Preventive Measurement

Drop in Cycle Time

Better Equipped

Drop in Inventory Cost and leading reduction in overall cost.

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Reference

http://www.businessinsider.com/what-is-the-internet-of-things-definition-2016-8?IR=T

https://blogmitcn.org/2014/08/21/the-tesla-iot-car-case-study/

https://www.ibm.com/blogs/internet-of-things/iot-benefits-challenges-opportunities/

https://www.strategand.pwc.com/reports/connectedcar-2016-study