Before Plunging Your Supply Chain into Immersion, Be Aware of the Perils

The world of Augmented Reality (AR), which is popularly known for its contributions to the gaming industry – Pokemon Go, Ingress, Sharks in the Park, to name a few, has progressed beyond our expectations and is making inroads into other markets.

Furniture retailer Ikea released an AR application, which allows shoppers an opportunity to view how a piece of furniture will fit into their home, even before purchase. Another frontrunner in this space, DHL, uses AR to improve its order picking process. Using smart glasses, supply chain managers can see exactly where items should fit on carts while they are picking orders.

Gartner predicts that the adoption rate will pick up moderately by 2020 with business adopting more than the customers. (Gartner also mentions “We predict by 2019, AR, VR and mixed reality (MR) solutions will be evaluated and adopted in 20% of large-enterprise businesses.”

AR, VR and MR are considered Immersive Technologies, which create a simulated environment through digital technologies. With customer expectations soaring and a focus on cost reduction, immersive technology has much to offer companies who are willing to take the plunge:

• From the ease of their computer device, customers can experience a variety of products from taking virtual tours of stores across the world to virtually trying on apparels.
• Enable virtual prototyping for preview rapid iterations, testing and conduct failure mode effects analysis before actualization thereby reducing costs.
• Initiate efficient order fulfilment through smart glasses that uses the most optimal route selection to pick the products.
• Expedite delivery operations through headsets or glasses that can locate the product based on the geo position of the deliverer and the delivery address.
• Conduct personnel training from anywhere in the world through virtual classrooms.
• Use VR and AR devices to conduct product failure analysis by simulating multiple scenarios on a prototype before finalizing a design.

However innovative this immersive technology is, it does have its own challenges. Let’s take a look at a few key factors that supply chain managers need to consider before embarking on the immersive technology journey:

Address common challenges as part of planning

Certain challenges are always hovering with any nascent technology. Here are some common ones we see:

1. Infrastructural problems like poor speed connectivity, hardware availability, compatibility issues, application ecosystem version.
2. Cyber security requirements and security software deployment to manage business sensitive information being scanned through such VR, AR devices.
3. Proper onboarding for employees used to conventional operating methods who might be resistant to the new gear.

Before an implementation, be sure to conduct an assessment to ensure the immersive technology solution offers compatibility, performance and effectiveness to support the business’ needs. For instance, basic infrastructural issues like poor speed and cybersecurity need to be addressed through network overhauls and firewalling as a pre-requisite. With business spread across geographies and cultures, be sure to conduct a training and sensitizing session with the personnel on the latest techniques, quality conformities, and governance policies. Using a lean framework, one can map the end-to-end process highlighting the nodes where intervention is needed in terms of training, guiding, mentoring, inspecting etc.

The neural network at most large organizations is an integrated ERP that controls all major functions. To make use of AR, VR devices more effectively, they must talk to ERP systems on real-time basis. This is still in an exploratory phase where such integrations are being studied by giants like SAP, Oracle with Google Smart Glasses.

Additionally, it is essential to complete requirements gathering, faster design thinking and thorough solution building to reduce friction during the onboarding of all stakeholders.

Plan for hardware availability and steep costs.

The first deterrents to adoptions are hardware availability and costs. First, lack of talented content developers promotes poor integration of audio and visuals to provide a virtual experience. This makes the user view a stitched environment with “seams and stitches” rather than homogeneity.

Being new, the mid-range VR and AR devices like accelerometers, smartphones, smart glasses, head-mounted displays (HMD) cost around $350-500 per device and if we add the cost of controllers and allied set-ups like cameras, lights etc. the overall cost shoots up drastically. The features of a VR headset undergo rejuvenation every six months and the performance usually decreases in less than a year. With few prominent manufacturers, the hardware available is still not mature enough.

A cost effective way of dealing with these issues are AR apps for smart phones which can determine quality issues like cracks, defects, failure points, etc. and provide online troubleshooting from R&D centers located far away from manufacturing plants. Issues which cannot be resolved through remote assistance can be addressed through virtual meeting rooms. These steps will help improve operational efficiency, cut logistic costs, reduce time to repair and realize higher business benefits.

These technologies will not radically change the business overnight but they will gradually become seamlessly part of the day-to-day operations. Operations will need to adopt VR, AR and MR to improve performance and accuracy. Enterprises aiming to be ahead in the game must learn, absorb, train on and execute immersive technologies.


About the author(s)

Sudeep Dayal

Sudeep Dayal is part of the Consulting & Services Integration practice at Tata Consultancy Services (TCS). He is a certified supply chain professional (APICS CSCP) with seven years of experience in the supply chain domain. Sudeep has deep knowledge in sourcing operations including supplier selection, supplier handling, ordering and costing, quotation management, localization of parts, as well as R&D ideas implementation. He has worked on account planning, S&OP planning, demand forecasting, sourcing and procurement, and SAP IBP implementation. He holds an MBA in finance and operations, along with a mechanical engineering degree.

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