“I want to know where my assets are”. This sounds like a reasonable business expectation. After all, these assets are on our balance sheet, and we usually know where our belongings are – right?
Yet it’s amazing how such a simple business need (usually captured under the name of “asset tracking”) covers in fact such a variety of potential situations and complexities Consider the following variations:
· Self-moving assets (Fleet) vs. other assets. Most fleets, whether they be cars, trucks, buses or construction engines, have been tracked for quite a long time and are now natively tracked by manufacturers. This is however not the case for most other assets such as cylinders, kegs, containers…
· Open Loop vs. Close Loop: in the open loop tracking, tracking assets stops at a point (typically delivery), while the close loop tracking is permanent, with countless logistic cycles involved. Open loop is usually associated with goods tracking, and closed loop with asset tracking. One may last a day, the other years.
· Single company vs. ecosystem – in an ecosystem situation, the asset (typically a container) will be managed by several companies along its lifecycle, with possible ownership change along the way. If it’s a close loop situation, the asset may eventually come back to the original firm.
· National vs International. Obvious one, with continental / intercontinental situations as extra variations.
· Land vs. Sea vs. Air Freight. Another easy one to understand.
· Discrete locations vs. Ubiquitous. In discrete asset tracking, the assets can only be in a finite number of known locations (production site, intermediate warehouses, final clients). In the ubiquitous asset tracking, the asset or good may be anywhere. In the first case, the asset identifier can be passive (barcode, RFID…) with a system to read them. Location can also be deduced from this interaction. In the second case, the asset will need to know and send its location in an active way.
· Approximate vs. Exact position: in some cases, an approximated location (a few dozen or hundred meters’ accuracy) may be enough. In some other, extreme precision is required to really fit the business need – for instance to track tooling & spare parts in a large industrial site, or to optimize a trip while taking into consideration traffic and roadwork. Location technologies and costs will not be the same.
· Indoor vs. Outdoor: Indoor asset tracking raises a lot of technological challenges (from lower telecom network penetration to GPS unavailability) which will strongly impact the solution.
· Value vs. Volume. Obviously, tracking a million of 50€ a piece containers, or 10,000 high-value containers will strongly change the tracking solution unitary cost target.
· Unitary or Reference asset tracking. In unitary tracking, each individual asset is identified and tracked, while in reference tracking, one only tracks how many units of each given type of asset is present in each possible location (reference asset tracking only applies for a discrete location case).
The combinations between all of the above are numerous, and so are the technological possibilities to address them, from bar-code reading to RFID scanning through Bluetooth (BLE & Beacons), WiFi, proprietary technologies, Mesh, Cellular M2M, LPWAN IoT such as Sigfox or LoRA, Satellite…
So what’s my advice ?
First, unless you are in the Fleet business, it’s unlikely you will find the right asset tracking solution on the shelf. Be prepared to invest some time in thinking, and do not rush to technology vendors.
Second, tracking assets is usually not a good business objective in itself. You need to start by clearly identifying the real business reason why, in the first place, one needs to track assets. This “primary business purpose” is the one that shall pay for the tracking system, with a clear RoI.
So think about this primary business purpose. The easy answer is to look for supply chain savings (time saved, losses avoided, flows optimized…). But if your business is well run, extra savings can sometimes be quite hard to find. So do you really want to track the asset for your own needs? Or could this add value to your customers? Maybe they would also be interested, in one form or another, in the information of where your assets are? Or maybe knowing exactly where each of your asset is could help you change your pricing and business or delivery model? “value creation workshop” can help here.
Being very clear on your primary business purpose will not only allow to measure the value created (and hence the budget you want to invest into asset tracking) but will also help you to be very clear on the acceptable technical limitations that still allow to deliver this business purpose. This will be extremely important as each technology has its limitations, and overcoming them quickly raises up costs. So this is something to know BEFORE starting even this affordable technical PoC that everyone is so excited about…
Of course, once you have implemented an asset tracking system that delivers your primary business need, you may very well discover that much more value can be derived out of your system! This potential upside only rewards those who have been clear on their primary business purpose. For the others, a tracking project might never go beyond their initial PoC…