Theoretical framework combines the theoretical and empirical parts together. It helps to solve the research questions and it is the basis of this research. Supply chain is defined in this thesis as “a set of primarily collaborative activities and relationships that link companies in the value-creation process, in order to provide the final customer with appropriate value mix of products and/or services”. These collaborative activities can be anything from designing to delivering the product or service. (Braziotis, Bourlakis, Rogers & Tannok 2013, 648). IoT supply chain can be considered as a service supply chain because companies
usually do not produce the whole process themselves. It is more cost-efficient to outsource other than company’s key activities (Baltacioglu et al. 2007, 107). The service supply chain is a network of parties that aims to create value for the customer (Normann & Ramírez 1993, 66) which consists of the product, service and information (Sintonen & Immonen 2013, 1308). In this thesis a five-layer structure of IoT solution is used. There are other possible structures as well used in some researches. Often a four-layer structure is used, and it is seen as the classification standard that offers consistency for IoT development. (Lee, Bae
& Kim 2017, 2) This is usually used in studies that are written about a technological perspective of IoT. As the customer is emphasized in this research, it was added to the framework. The whole process starts with collecting data and then transforming it into a format that can be utilized by, for example, companies. Theoretical framework is presented in the figure 1.
Figure 1. IoT supply chain (adopted from Čolaković & Hadžialić 2018, 19; Lee et al. 2017, 3)
The first step in IoT supply chain is collecting data by IoT constrained devices. Often these devices have sensors that can be embedded to almost any device, like mobile phones.
Sensors observe and evaluate changes in its environment, for example, changes in the temperature, light or movement. Data can also be collected from smart objects, social media
Devices
•Identification, sensing
•Data acquisition
Networks •"Connectivity"
•Data transfer
Platform
•Data storage and analytics
•Big data analysis
•Machine learning
Services •Applications
•Visualization
Customer
and the web. Data is not analyzed in this layer; thus, the collected data is forwarded to a data storage through the network. (Čolaković & Hadžialić 2018, 21, 24)
The next step in the supply chain is network layer. Network is a crucial part of the IoT supply chain as it allows the communication between objects and between objects and internet.
Network layer consists of hardware, software, technologies and protocols. Depending on the devices, network connections can be either wireless or wired connections. However, most of them have wireless connections because it has better availability and mobility.
There are dozens of different kinds of network solutions that can be used in the IoT supply chain, and new technologies emerge all the time. Connectivity of the network layer refers to the fact that IoT devices are connected to other devices or applications anytime and anywhere which enables efficient and real-time transferring of data. (Čolaković & Hadžialić 2018, 19-22)
The third step in the IoT supply chain is platform layer which is located between IoT objects and application layer. It is a cornerstone of the IoT solutions. The platform layer is for storing data and processing it. Analyses can be made with the help of, for instance, big data and machine learning. It also enables managing and monitoring the whole system from sensors to applications. (Rayes & Salam 2019, 206) Usually there are many different IoT devices for different purposes which makes the collected data quite versatile. This layer is necessary as it extracts heterogeneity of the collected data so that there can be seamless integration with anything. (Díaz et al. 2016, 107) Users and applications can access collected data through this layer (Calbimonte, Sarni, Eberle & Aberer 2014, 51). The increased amount of data has led to a need to develop new platforms that can provide better scalability, storage and processing. These platforms are important parts of IoT systems as they make it possible to integrate IoT objects with different network technologies. (Čolaković & Hadžialić 2018, 20)
The fourth step in the IoT supply chain is the service layer which refers to the point where companies are utilizing the collected data in different ways. Application services are produced through the IoT platforms. Some platform providers can offer, for example, analytics tools as well. They provide accessible user applications that ease the processing, understanding and utilizing the collected data. IoT has already provided a lot of smart applications to many industries and it has potential to offer them to almost every market.
(Čolaković & Hadžialić 2018, 20; Díaz 2016, 100)
The final step in this framework is delivering the service to the customer. As this thesis is based on B2B solutions, the end-user is not emphasized here. The customer aspect was added to this framework as it is interesting to study this phenomenon also from their point of view. Examining the customer’s experiences adds more depth to the studying process of a service supply chain. In addition, IoT affects significantly the health care sector and therefore, getting their opinions is valuable.