Centralised supply chains—where one organisation plans, builds, and manages a complete supply chain—are not sufficiently scalable for building and delivering complex digital services and products for IoT use cases. The considerable number of different components and suppliers involved, and the flexibility required to assemble these components within the enterprise’s timeline means that service providers must employ a decentralised approach to supply chain management for IoT-oriented digital services. Let’s examine this approach.
A decentralised or federated approach to supply chain management means that business and operational decisions are made independently by each participant in the supply chain. Supply chain participants offer a digital product or service to their immediate upstream customer, and if it’s accepted, it is their responsibility to deliver according to that commitment. If they don’t, credibility will be damaged, and they’ll be less likely to have future offers accepted.
By thinking of each link in the digital supply chain as a buyer-seller interaction, we can better understand how the decentralisation of supply chain management for IoT digital services can be achieved.
Supermarket chain IoT use case
For illustration, consider the following use case: A large supermarket chain deploys a shelf-scanning system in all 500 locations across the country. This system uses robots to autonomously travel down the store aisles, using cameras to scan the shelves. Video is streamed and analysed in real time to identify which products need to be restocked. The supplier of the scanning system contracts with a major national communications service provider (CSP) for the connectivity, compute, storage, and security elements of the solution that are external to the robots. In this example, the service provider is required to supply connectivity to each store location such that each video stream can be analysed with artificial intelligence (AI) as a service in the cloud, with latency of less than 100 milliseconds.
To deliver this comprehensive solution, the service provider must onboard many partners or “subcontractors” to provide different elements of the service that it cannot deliver from its own inventory (e.g., last-mile access, nearby edge compute capacity, SD-WAN, SASE, and Zero Trust services, Firmware-over-the-Air service). Adding to the complexity, these partners may also need to contract with additional partners to complete parts of the offering.
Reducing supply chain complexity
Ensuring the services delivered are standards based reduces complexity and confusion by providing common terminology with partners and the enterprise and helps ensure services work as prescribed. Industry organisations such as MEF offer standards and APIs to help reduce supply-chain complexity and speed up service delivery.
In this supermarket example, each buyer-seller relationship must be managed in an automated, decentralised fashion to handle the complexity and scale of the retail service offering to the shelf scanning system provider.
Machine-to-machine buyer-seller interactions using standardised APIs are advantageous over human-to-human partners interactions. For example, the transfer of information between the service provider and the last-mile-access providers cannot be done using outdated phone and emails transactions, but rather must transact through the respective software systems via standardised APIs.
In addition, the identities of all entities (machine or organisation) in the supply chain must be provable without all participants in the supply chain being required to use a centralised identity provider or certification authority. For example, the shelf-scanning robot must be able to prove its identity to access different solutions in the cloud without forcing the robot and the service providers to use the same third-party identity provider.
Business transactions such as placing an order or issuing an invoice must be done such that the buyer’s machine and the seller’s machine cannot progress to the next step without validation by both systems that it was executed properly and recorded in a non-repudiable way to eliminate disputes after the fact. This is a central element of Smart Bilaterals defined in the newly published MEF 114 standard—any data shared between the buyer and seller has to be trusted without the need to expose the underlying data.
Forward-thinking service providers are embracing a decentralised approach of delivering comprehensive solutions and managing complex supply chains with:
Standardised APIs for accelerated service delivery with supply-chain partners
Standardised Smart Bilaterals to enable trusted commerce
Secure transactions through APIs with built-in security
Service providers adopting this approach will be central players in the growing connected economy, realising faster service delivery from partners and to end customers, error free and offering a greater customer experience, and ultimately, faster time to revenue.
