Integration of IoT with Supply Chains: A Study on Small and Medium-Scale vs. Large-Scale Manufacturing Enterprises

Abstract

Internet of Things (IoT) has been the centre of interest in Industry 4.0 as it supports automating decision-making in supply chains and operations. Thus, IoT integration is now considered a strategic enabler of operational excellence and competitive advantage. Hence, to enable the integration of IoT with supply chains, this paper focuses on identifying barriers/challenges to IoT adoption, along with mitigation strategies. For this purpose, this study employed a two-round Delphi study, involving 12 manufacturing industry experts from small and medium-sized enterprises (SMEs) and large enterprises (LEs) in Sri Lanka. The analysis revealed that the major barriers include high investment costs, data security concerns, a shortage of qualified personnel, and system reliability issues. However, the analysis suggests that financial constraints, lack of knowledge, and uncertainty regarding the payoff of investment are the primary limiting factors for SMEs, whereas LEs are limited by resistance to change within the organisation, and operational complexity. Effective mitigation strategies, such as step-by-step implementation, pilot testing, and capitalising on external expertise, were proposed by the experts to reinforce the integration of IoT with supply chains. Hence, this study presents comprehensive guidance to organisations and policymakers to enable the successful and sustainable integration of IoT into supply chains.