Industry 4.0 – Supply Chain

Supply Chain Management is a core system for many companies. Well-designed can, not only, increase productivity and quality of products, it can also reduce unnecessary costs. The concept of supply chain management is well known and has been implemented in many companies for years now. Many might think that such different concept as Supply Chain and Industry 4.0 wouldn’t impact one another. Overall the idea of Industry 4.0 comes from the industrial revolution. It is directly connected to factory production and new technologies. As we know the concept of supply chain management is a wide and complex system that benefits not only factories but business in general. At this point you might ask, I am a believer of the supply chain, but how can my business benefit from Industry 4.0?

Industry 4.0 – review

For past few weeks we’ve been talking a lot about Industry 4.0. We believe that this concept will take off in 2017 as it becomes more and more recognised by general business population. However to see how this idea can be beneficial to our supply chain management let’s review its core values that Industry 4.0 can affect in our supply chain.

1. Intelligent Factories

Use of smart solutions, robots and computers that are integrated with one another, cable of adjusting work to fit demand, reducing waste and increasing efficiency.

2. Internet of Things / Internet of Service

All devices should be connected to a network to be able to communicate, current information has a value on its own, and being in possession of that information will give us an advantage. Therefore a quick communication is a key.

3. Analytics

Ability to processed gathered information and data is essential. Being in possession of knowledge that we cannot use due to inability to process it would automatically knock that advantage off our hands.

4. Employees and their knowledge

The knowledge of our employees increases the value of the company and it’s a huge asset. Especially now a good and learned employee is very hard to come by. Therefore we should value his input.

Core focus areas of Supply Chain Management

As we all know well, business is a living organism. Every company owner who wants to see his business succeed must adjust to changes. Industry 4.0 with supply chain management offer a recipe which should help the companies thrive in the future.  A recipe is short but not that easy to follow. However, when well applied, it offers cost reduction and an increase in profits. What shell we then concentrate our attention on?

1. Supply network design

Should be designed in such manner to reduce the time of product delivery to the customer. It doesn’t necessarily mean that supply chain must be shortened, we can increase work on its efficiency.

2. Supplier management

The relations with all suppliers must be looked at. The close and reliable relationship must be established. Good working terms with all partners ensure success of the company.

3. Supply chain visibility

Quick response time to every arising situation results in a reduction of risk of crisis and increase in customer satisfaction.

4. Demand planning

Well-designed planning will decrease waste.

5. Product innovation platforms

To be competitive every company must invest in innovation. More often than not we can hear opinions that innovation is the key to success.

Industry 4.0 and Supply Chain for all

As we mentioned before both of the concepts are not only designed for factories. They can be implemented in any business model. Also, companies working in different fields can benefit from this new approach. As it often happens every business owner must individually tailor the elements to his own needs.