We are currently in Fourth Industrial Revolution, "Industry 4.0"

Integrating advanced digital technologies in supply chain and industrial processes. It's the radical shift in capability to design, create, and distribute manufacturing products enabled by the connection of physical and digital systems.

What is Industry 4.0?

Industry 4.0 is the next stage of the industrial revolution, which includes advanced technologies such as IoT, AI, big data analytics, cloud computing, and robotics. Their adoption in the supply chain process brought about radical changes in how companies produced and distributed products until their sale.

The purpose of Industry 4.0 is to increase the effectiveness, flexibility, and profitability of production processes through increasing automation and digitization. Industry 4.0 is also referred to as smart factories. These are places where machines would talk to other machines, thus making the whole supply chain process more effective, flexible, and cost-effective.

Industry 4.0 is driven by technology, but the end goal is to improve human activities in logistics and ultimately to improve the customer experience.

Supply Chain in Industry 4.0

Smart Warehousing - IoT devices enable real-time inventory tracking, efficient supply chain management, and smart warehousing. They track product location and movement, identify supply chain bottlenecks, and optimize warehouse layout, reducing product retrieval time.

Predictive Maintenance

IoT devices monitor machine health in real-time, enabling businesses to identify potential issues and reduce maintenance costs. Predictive maintenance, using machine learning algorithms, predicts maintenance needs, preventing unexpected downtime.

Autonomous Vehicles

Self-driving vehicles are gaining popularity in the supply chain industry, reducing manual labor, increasing efficiency, and reducing labor costs, delivery times, and accident risks.

Artificial Intelligence

AI technology aids businesses in analyzing supply chain data, predicting demand, optimizing inventory levels, and improving forecasting accuracy. It can also optimize shipping routes, reducing costs and improving delivery times.

Data Analytics

Big data analytics helps businesses optimize their supply chain processes by analyzing data from IoT sensors, customer feedback, and social media, identifying areas for improvement and reducing costs.

Benefits of Supply Chain in Industry 4.0

Increased Efficiency

Efficiency is perhaps one of the most prominent effects of Industry 4.0 on the supply chain. Because most supply chain processes are automated and digitized, businesses can save on time and resources that would have otherwise been engaged in completing such tasks. This heightens productivity by reducing lead times and shortening delivery times. The efficiency in supply chains has been increased with examples such as smart warehousing, autonomous vehicles, and predictive maintenance technologies.

Cost Savings

Another significant benefit of Industry 4.0 within the supply chain industry is the cost saved. Because of the new technologies being implemented, businesses could now optimize their operations and reduce downtime, therefore reducing operating costs. For instance, with smart warehousing technology, businesses will be able to monitor their levels of inventory in real-time. As such, it is easier for them to manage their inventories and even avoid overstocking or stockouts. Predictive maintenance technology reduces downtime by constantly monitoring the health of machines in real time and enabling a business to act before something goes wrong. Besides, autonomous vehicles will reduce manual labor factor that currently contributes a great deal to labor costs. Artificial intelligence, as applied to the supply chain, can also help a business predict demand, optimize inventory levels, and improve forecasting accuracy, further contributing to cost savings. Reducing costs means improving the bottom line, which is essentially increasing profitability.

Improved Transparency

Integration of IoT devices and data analytics has facilitated the supply chain industry in Industry 4.0 with increased transparency. Supply chain visibility in real time can enable business firms to track their operations and potential issues on time. They can check their inventory level, time of delivery, and the processing procedure to see everything goes right. They would have more profound insight into the supply chain for identifying areas of improvement and making data-driven decisions.

Improved Customer Experience

Industry 4.0 would thus improve the customer experience by its very basis of improved lead times, greater reliability, and lower errors. This increased speed and reliability in delivery have contributed to higher customer satisfaction and loyalty. Companies could analyze customer behavior and preference by the help of data analytics, which would allow them to provide bespoke offerings to improve customer satisfaction.

Read More : https://www.sciencedirect.com/science/article/pii/S0925527323001457

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