BY VIKTOR BRANDON LEEK, PÄR FORSELL, AND LOTTA JOHANSSON
The term ”Internet of Things” (IoT) was coined at the turn of the millennium, and just as with most technological breakthroughs, Amara’s Law* has proven to be applicable: “People tend to overestimate the short-term impact of new technologies but underestimate their long-term impact.”.
Fifteen years ago, “IoT” was a term we constantly saw around us, but the applications themselves were often limited in scope, and it was difficult to find a correlation between the data being transmitted and the value it could generate for the user. Today, it’s exactly the opposite; we hardly talk about the IoT at all anymore, even as most things around us are connected and generate immense amounts of data, which in turn creates excellent opportunities for users to transform that data into value for their own businesses. Unfortunately, there isn’t a direct line between data and business value; typically, it needs to go through four steps:
1. Registration – relevant data is captured.
2. Processing – Data is consolidated and combined to form relevant KPIs.
3. Visualization – deviations and trends are highlighted.
4. Behavior – an activity is triggered that creates value in both the short and long term.
Even though this is a completely logical sequence, many organizations can only manage to get as far as step two or three. We’ve also observed that the more data that’s recorded in the first step, the harder it is to achieve accuracy in the fourth step, as this both introduces sources of error and makes it harder to stay focused. Time also becomes a factor here that affects the ability to create value.
You need to be quick
It’s all about moving as quickly as possible from the moment data is recorded to the moment a targeted, value-creating action is triggered. Customers who have the technical hardware required to capture data via the IoT are therefore now also seeking a service — a platform and/or software — that, through everything from benchmarking to flagging anomalies and providing concrete advice, creates the conditions for increased business value. In our business, we call this ”connectivity services”—in short, services for interconnectivity.
Connectivity in Internal Logistics
In warehousing and material handling, connectivity and data collection create the conditions for eliminating waste and fostering a safer work environment. Forklifts, conveyor systems, plastic molding machines, cranes, and other automation equipment are now always connected, as are the tools used for manual order picking. This means there are significant opportunities to monitor warehouse processes in real time and respond to deviations. With this real-time monitoring, it’s also possible to methodically analyze how flows and results change over time and between seasons, which in turn makes it easier to plan and optimize operations.
Clearly adds value
The value that can be created using hardware, connectivity, and software/platforms can be categorized into four main groups:
• Flow and utilization rates can be optimized, both through real-time control and through structural changes, resulting in increased productivity.
• Maintenance needs can be anticipated, thereby preventing downtime or more costly/time-consuming interventions later on.
• Accidents and injuries can be prevented, and in cases where incidents do occur, a proper analysis of root causes can be conducted to continuously reduce their frequency.
• Energy optimization that can have a positive impact on battery life, energy consumption, and energy costs through smart control.
As I said, this is nothing new. We already live in a connected world, with access to everything and everyone at the touch of a button. However, new, higher standards are constantly being set, which has led to a shift where what used to be a competitive advantage is now simply a basic requirement.
Experiences with Connected Warehouses
Since 2018, we have chosen to equip all of our warehouse forklifts with technology that collects all available data on what is happening in the warehouse and how the forklifts are being used. Combined with data retrieved from our business system, this provides our customers with a comprehensive overview of their forklift fleet, its usage, energy consumption, and more—information that can be used to improve their own operations.
Drivers of Connectivity
When customers talk to us about their needs and what motivates them to connect to our services, we can identify various driving factors, which we have simplified below into three different stakeholder groups:
Focus on Safety
- Get a complete overview of permissions.
- Conduct root cause analyses of all incidents and near misses immediately after they occur.
- Ensure that daily inspections are conducted.
- Configure parameters such as speed, depending on the driver.
Optimization & Productivity
- Gain full control over utilization rates.
- Compare driving patterns among different drivers.
- Understand how variations throughout the day and across seasons affect the need for flexibility.
- Identify opportunities to manage operations so that forklifts can be moved between departments or facilities as needed.
Order & Organization
- Take full control of your contracts.
- Easily find and break down your costs.
- Make taking inventory of the forklift fleet a breeze.
Most customers, of course, have a combination of the above motivators, but there is usually one that stands out a bit more and is the one that initially sparks their interest. The customer that has made the most progress in fully realizing this potential is one of the UK’s leading retailers, which—together with consultants from Toyota Material Handling—has set up an intralogistics control tower where, with the help of customized reports, they can monitor and analyze their fleet of over 2,200 forklifts. While “low-hanging fruit” could be addressed relatively quickly using the collected data, an ambitious project was launched to spend twelve months mapping how utilization rates, costs, driving patterns, and other factors varied across seasonal fluctuations, between facilities, between operators, throughout the day, and between different forklift models.
Effects in Multiple Dimensions
The results of such a comprehensive analysis have implications across multiple dimensions, with the direct impact, of course, being on how the forklift fleet can be optimized and what flexibility can be built in to best suit the customer’s operations. In addition to the direct impact, several root causes are also identified that can improve safety and productivity—for example, by addressing individual training needs, the impact of different types of management/supervision, the need to balance workflows, operational bottlenecks, and areas or situations with an especially high risk of accidents.
This trend—toward data-driven warehousing—will continue, and as even better tools for collecting data and even smarter ways to generate accurate analyses become available, the potential will grow.
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Viktor Brandon Leek is the Director of Logistics Solutions at Toyota Material Handling Sweden.
Pär Forsell is the Solution & Training Manager at Toyota Material Handling Sweden.
Lotta Johansson is the Product Manager for Connectivity at Toyota Material Handling Sweden.
* ”Amara’s Law” is a saying coined in the 1980s by futurist Roy Amara (1925–2007). The saying describes how people tend to overestimate the short-term impact of a new technology while underestimating its long-term impact. This means that we often focus on immediate results and overlook the long-term consequences, both positive and negative. Sources: Wikipedia and ChatGPT,
