How Industry 4.0 Enabling the Next-Generation Digital Supply Chains?
Published on : Wednesday 06-05-2020
The fourth industrial revolution is revolutionizing traditional manufacturing processes in all aspects. This is leading manufacturing towards digitalization enabling manufacturers to become automated, agile, and drive result-oriented. Industry 4.0 paves the way for disruption and allows companies to reconsider the way they design their supply chain. In this respect, megatrends and customer expectations change the game. Many megatrends have a profound influence on supply chain management.
As manufacturing processes need to adapt to keep up with the changing ecosystem, supply chains also have the opportunity to reach the next horizon of operational effectiveness. Companies must leverage emerging digital supply chain business models to achieve higher gains. The Industrial Internet of Things (IIoT) is also a major driver changing the supply chain dynamics for businesses.
Industry 4.0 also gives to the rise of data exchange and automation in manufacturing technologies. Internet of Things (IoT) is one fascinating technology that supports the same notion of the world becoming more connected. It is widely utilized to depict connected devices used in both industrial and domestic environments. For instance, Amazon Dash, a Wi-Fi-enabled device from e-commerce giant Amazon can be placed anywhere in the home and reorders a specific product with just a click. This can have significant benefits in domestic connected devices, but it also opens an opportunity for the supply chain to benefit it.
Smart factories use automated machinery connected through the internet to facilitate more efficient and flexible production processes that can quickly adapt to production changes and demands. According to reports, the Siemens AG plant in Amberg, Germany, is 75 percent automated while German truck builder MAN is developing IoT technology into its vehicles, allowing transport operators to access live feeds of raw data on the vehicle’s performance and track their journeys.
Moreover, supply chains driven by IIoT have a data challenge that needs to be solved. A network of sensors embedded in the supply chain provide powerful data, but in high quantity, potentially driving up network traffic to expensive and impractical levels. To this problem, Edge AI provides a solution by processing data on a device and ensuring that only actionable data needs to be fed back to the cloud, which reduces network congestion. According to a PwC study on Industry 4.0, almost 33% of over 2000 respondents said they re in the process of digitization of supply chain operations.
Hans Thalbauer, senior VP of supply chain and IoT at SAP said, “Digital supply chain is all of the solutions and business processes that are relevant for the Chief Operating Officer. We define it in a way where we say we need to combine years of ledger planning, we need to include logistics and transportation management topics, but also the engineering, R&D, manufacturing and asset management areas. In this context, industry 4.0 and the industrial internet of things are super important.”
Although the influence of Industry 4.0 on the digital supply chain is not limited to deliver better efficiency and productivity, it exceeds beyond and provides manufacturers a competitive advantage. The adoption of digital supply chains also advances businesses’ ability to serve their customers and create better business collaborations to gain more profits.