We tend to think of the (first) industrial revolution as a moment where the world changed in the blink of an eye. One morning, the world was dominated by cottage industries, and the next, steam power had completely transformed the nature of commerce, manufacturing, and modern life. What we sometimes forget is that the period we think of as the industrial revolution actually lasted more than 60 years—more than the length of a human life span during that era. Sure, things move a lot more quickly now, but it’s still a nice reminder that for all the talk about Industry 4.0 (aka the fourth industrial revolution), nothing happens overnight. The process of factories getting more connected and supply chains going digital might not take 60 years, but in the meantime it still remains a work in progress. That said, it's increasingly likely that the rewards will be worth the challenges.
For many decades, baseball statistics barely changed. People counted hits, batting average (the number of hits per at bats), and runs batted in and measured the value of their players based on those statistics. In the late twentieth century that all changed. With the advent of Sabermetrics and what would eventually be known as Moneyball, statisticians, baseball executives, scouts, and even casual fans entered a period of statistical renaissance. Old-fashioned stats took a backseat to complex new creations like OPS (on-base percentage plus slugging percentage) and Wins Above Replacement (a complex, GDP-like formula meant to distill value into a single statistic).
In a recent Seattle Times Article, readers got an intimate account of how Cloudburst Brewing creates its seasonal fresh hop beers. While most hops used in beer production are dried before they’re shipped from the farm, fresh hop beers utilize fresh-picked, “wet” hops that haven’t been dried yet. As such, this popular style can only be brewed during and immediately after the annual hop harvest, and only under ideal conditions. A traffic jam, a flat tire, or a power outage at the brewing facility could jeopardize brewers’ efforts, owing to the extremely short shelf-life that these “wet” hops have.
Let’s talk about Amazon Go for a moment. The incredibly successful online retailer has recently made headlines with its latest foray into brick and mortar shopping, a series of convenience stores that, notably, don’t feature any human cashiers. Instead, shoppers (all of whom need an Amazon Prime account) use an app on their phones to scan each item they put into their (physical) shopping cart. This is noteworthy for a host of reasons, but let’s look at it from an inventory management perspective. The store is stocked with a considerable number of items, which all need to be replenished as they are sold, and Amazon is able to track the flow of goods out of their stores with no human intervention. Not only that, but they’re able to link each piece of inventory that leaves the store to a particular user account, and then make recommendations to that user based on analytics processes designed to predict future buying behavior.
Let’s say you’re an amateur baker, and you’ve just agreed to participate in a pie bakeoff with some of the other bakers in your town. You have a few pie recipes that you like, but because the stakes are suddenly much higher than usual, you want to create a new recipes that improves on your existing ones, in order to better compete with your opponents. Most likely, this is going to mean finding new or old recipes to adjust and adapt, and then taking those adapted recipes and producing test batches of them, trying out the results, and producing new test batches with the tweaked recipes. This process, needless to say, would be incredibly time and resource intensive—not least of all because baking is an extremely fickle business, and it’s often difficult to predict the results of changes in ingredients or cooking time.
It’s still about a month until Thanksgiving, but you may already be deep into the planning process for the big event. Some of your friends and family are flakey, so you won’t have a full list of RSVPs until much closer to the holiday itself, meaning that when you sit down to sketch out what dishes you’ll be cooking and what ingredients they’ll require, you’ll have to use a combination of confirmed and projected attendees. For some dishes, it might be easier to wait until a few days before Thanksgiving to get the necessary ingredients, but you’re worried that your nearby grocery stores might run out of a particular brand you like if you wait too long, and there are some items that need to be purchased well in advance because they need to be stale or overripe before they can be used, like bread for stuffing or bread pudding.
Logistics 4.0, digital logistics, modern transport logistics: whatever you want to call it, the new paradigm emerging in the world of transporting goods from production plants to consumers is gaining steam rapidly. While, in the past, logistics was frequently a matter for pen-and-ink planning, relying on a set of well-trodden trade routes, the industry is becoming more sophisticated, more complex, and more connected than ever before. As the industry evolves, the utility of this new level of connectivity will become more and more apparent, resulting in exciting transformations in the way that goods are moved from place to place. Don’t believe us? Just take a look at some of these statistics.
Imagine for a second that you’re entering a friendly betting pool for the 2018 World Cup. Germany won the contest in 2014 (the most recent tournament), so you decide that it stands to reason that Germany will win again this time around. Hindsight being 20-20, we now know that you would have lost your bet, as France won the tournament and Germany didn’t advance out of the first round. Your betting strategy of assuming that past results would continue to hold ultimately wouldn’t prove to be the best approach.
Let's say you've got big event coming up—maybe an awards ceremony, or an important anniversary. You and some of your friends are going to the event together, and to make the whole affair a little more special you decide to rent a limousine take you there and back. Though the venue is only an hour’s drive away, your friends’ homes are spread throughout your town in ways that make planning the optimal order in which to pick them up (and drop them off after the party’s over) a challenge. On top of that, not everyone will be ready at exactly the same time, and those who would be picked up later in the process would like to know in advance so that they can spend more time preparing. Where do you begin when it comes to planning out a tour that works for you?
As we enter an increasingly digitized era in supply chain management, owing to new technologies from IoT sensors to real-time freight tracking, the hurdles that face manufacturers and logistics providers alike are becoming ever more complex: software integration are becoming increasingly difficult, longstanding information silos are suddenly becoming huge operational hurdles, and increased globalization is adding complexity to virtually ever corner of the supply stream. What waits on the other side of those challenges? A world of increased connectivity and the promise of the Industry 4.0 revolution. Anyone who’s been following the global automotive supply chain the past several years know that, now more than ever, success is often a matter of turning mission critical data into concrete business insights.In the spirit of turning data into insights, here are a few statistics that might shed some light on the current state of supply chain management.