In one sense, transitioning to a full-fledged Logistics 4.0 system is always going to be more of a challenge than making Industry 4.0 a reality. Yes, Industry 4.0 requires big investments in carefully-chosen IT infrastructure and a strong commitment to visibility and connectivity, but the purview of this technological revolution is mostly limited to the factory floor—i.e. a physical space that you, as a manufacturer, have access to and control over. With logistics, this limit doesn’t exist—instead, you’re trying to gather data from objects that are in motion all around the world, from shipping containers to trucks to the forklifts in your partners’ warehouses.
In much of the world, we’re stuck in the grey doldrums of late winter—but let’s think back to the recent holiday season for a minute. Specifically, let’s imagine that you’re trying to send a last-minute gift to a friend via FedEx, UPS, or another package delivery company. You’re hoping that the package will get there before the holidays, so you do some research into your best shipping options: you’re hoping to figure out which company offers the best ratio of on-time or ahead of schedule deliveries to competitive rates, which carriers have the best track record on lost or damaged packages, and who has the best tracking options.
IT managers and logistics managers have more in common than you might think. Both require transparency and the real-time data it enables in order to be effective in their roles. Both also thrive in the decision-making process and all the back-and-forth with stakeholders that it entails. At the same time, there are of course glaring differences. IT teams work with end-user computer hardware, software, and networking technologies every day, while logistics planners interact with their own hardware with the sole intent of making goods move smoothly on their journey to the customer. Both are customer service oriented, it’s just that the IT manager’s customers are within the same company while the logistics manager’s customers are outside client companies. It’s that root level focus on customer satisfaction that drives both roles.
They say that those who don’t learn from history are doomed to repeat it—but in point of fact, relying too heavily on historical knowledge can often be just as bad. History tells us a particular new innovation will never work, or a new strategy will never succeed, and as a result we’re often blindsided when something truly innovative or unusual comes around. This is particularly true in the logistics industry, where changes in the global economy and the nature of supply chain technology are causing an exponential increase in the number of paths that any given cargo might take from producer to consumer.
You know that one product that seems to be in every outgoing order? The one kept all the way in the corner of warehouse 2, opposite from the loading dock? How much is it costing you to keep sending the forklift across 10,000 square feet of warehouse, multiple times per day? What if you moved that item to an empty bay 2 rows away from the docks? How much time, energy, and money would that save your logistics budget? If you don’t know the answer to any of these questions, it’s time to take a good, hard look at the logistics end of your supply chain to weed out the wasteful spending and tighten things up a bit. To get you started, we’ve pulled together a list of our top 5 areas of waste in supply chain logistics. If you can get these under control, you’ll be well on your way to a streamlined value chain and much-improved logistics ROI.
In our last look at Logistics 4.0 statistics, we discussed 5 that we feel will help define the shipping and logistics sector in the coming years. Today, we’re going to add to that list with 5 numbers we feel might be getting short shrift in coverage of this arena. Logistics is undergoing a collection of disruptions that seem to have hit out of the blue. There’s a seeming tsunami of dissatisfied customers, rising fuel costs, and global weather pattern changes, to name but a few. In order to respond appropriately, the shippers of the world have had to pivot, fast. Many are choosing to dive headfirst into the emerging world of Industry 4.0 technologies that promise to help predict at least some of these disruptions far enough in advance that alternative plans can be set in motion. Among the technologies seeing increasing adoption are AI, machine learning, RPA, and IoT. These technologies, combined with intelligent deployment tactics, are already having a big impact on the global supply chain.
Logistics 4.0 is an offshoot of the larger trend in manufacturing known as Industry 4.0. Think of it as being to the supply chain what Industry 4.0 is to the factory, and you’ll begin to see the potential for massive disruption (of the good kind). As such, there is considerable overlap in the technologies at play. For example, the same IoT sensors that are revolutionizing preventative maintenance on the production line are also revolutionizing how the purchasing department determines what supplies to order. And the ability to automate production processes is being mirrored in the way those orders are being placed and the shipments themselves are being handled when they arrive. With the arrival of smart pallets, shelves, trucks, containers—even entire warehouses—logistics providers are able to create complete transparency up and down the value chain.
The practice of trying to get the right goods to the right place at the right time in the right condition is virtually as old as time—and yet, each year, new trends, ideas, and best practices emerge in the fields of logistics and supply chain management. With the rise of digital technology and increased connectivity across the supply chain, the current rate of change in these fields is unprecedented. The world of logistics even 5 to 10 years from now will probably have undergone even more dramatic evolutions, and it may be virtually unrecognizable compared to the supply chains of the past.
Topics: Logistics 4.0
Whether you’re a freight forwarder seeking out a new ERP system that helps to manage the flow of goods from origin to destination or a manufacturer looking to add visibility and bolster efficiency within your own transportation management processes, selecting the right logistics or transportation management software can be a difficult task. In some ways, the process of selecting the right technology is a lot like finding a 3PL (third party logistics provider) with whom to partner. In both instances, you need to consider price, customer service, existing relationships, and scalability—but you also need to take stock of your organization’s values and provide a clear roadmap for the future of you're your operations. Even if you choose the most reputable partner in the business, the partnership likely won’t be a success if their goals aren’t well-aligned with your own.
The rise of Industry 4.0 has saddled supply chain managers with a lot of lofty expectations. With the idea of the so-called global factory, we’re given visions of a future supply chain in which manufacturing processes are so decentralized that the boundaries of any individual production facility become meaningless. By the same token, as we look towards the future of connected digital logistics, we tend to envision a world in which demand-capacity planning is so sophisticated and transport logistics are so agile that the need for physical warehouses of products will dwindle away and ultimately vanish.
Topics: Logistics 4.0