Ask anyone in the automotive industry about the future of artificial intelligence (AI) and you’re likely to hear one thing: Driverless cars. Yes, the development and proliferation of driverless cars or assisted driving is perhaps one of the greatest innovations on the horizon in today’s automotive manufacturing industry. Yet even so, AI has the potential to impact the automotive manufacturing supply chain in equally profound and interesting ways beyond the idea of the driverless car. In fact, AI has the potential to be a truly disruptive force in the way automotive manufacturing companies produce vehicles and how the consumer interacts with the end product.

With AI as an increasingly common technology platform, the automotive industry is set to experience significant changes in the coming years in terms of production and supply chain management. As vehicles become more integrated, individualized, and complex, manufacturing companies will have to leverage more lean methods of production and supply chain logistics to keep pace with the demands of such a variant-rich industry.

Fact or fiction. Trend or mindset. Fad or fixture. While Big Data has certainly permeated nearly every aspect of today’s manufacturing and supply pipeline, some industry analysts still question the validity, value proposition, and staying power of Big Data for companies as they strive to streamline their operational platforms and leverage lean manufacturing principles for optimal productivity and profitability.

First introduced to the manufacturing and supply chain landscape in the early 1990’s as a method of grouping, sorting, and analyzing large and complex data sets into executable actions. The sorting of these large, unstructured datasets gives manufacturing companies the capability to apply predictive analytics and other forward-looking logistic strategies to increase the efficacy, efficiency, and cost-effectiveness of planning and production programs.  

So much in the discussion of modern manufacturing surrounds the subject of Industry 4.0 and its influence on the daily, weekly, monthly, and even annual processes associated with the global manufacturing industry. In fact, one could argue the term Industry 4.0 is tossed around by industry insiders without truly understanding its place in the context of manufacturing and supply chain processes on a global stage.

Whether it’s misinformation about how Industry 4.0 came to be or the ways in which manufacturing companies can deploy the concept of Industry 4.0 as a core driver of moderneized, intelligent production, there’s still much supply chain planners and managers can learn about Industry 4.0 and its applications in today’s global manufacturing and supply streams.

Steam power. Henry Ford’s assembly line. Proliferation of coal-based energy. These developments in the evolution of manufacturing fundamentally changed how goods were produced and the way in which manufacturers moved products from the factory to the customer. If these were truly disruptive forces in the industrial economy, today’s producers are currently experiencing just as seismic a change in production processes in the form of Industry 4.0.

Most commonly defined as the movement of the industrial sphere to a more integrated, digital method of managing production and supply processes, Industry 4.0 is built upon the concepts of end-to-end (E2E) visibility, agility, and efficiency across each touch point in the value chain. Given the variant-rich nature of today’s manufacturing landscape, Industry 4.0 answers a common question for today’s manufacturers: How do I reduce overall operational costs while still being nimble enough to respond to unforeseen changes in planning or production programs?

The manufacturing industry is astir over Industry 4.0. This oft-used term has become something of a buzzword, but it also represents a profound shift for the global manufacturing industry. Our Vice President for Manufacturing and Logistics, Robert Recknagel, recently sat down with us to talk about what Industry 4.0 is (and isn't) and explore the ways that technology should support the migration to Industry 4.0.

Call it a revolution. Call it a renaissance. Call it a reimagination. Call it whatever you’d like, but it’s undeniable how digitization has truly overhauled nearly every aspect of the automotive value chain. From planning to distribution, sales to reporting, digital technology has streamlined and made more efficient  the way manufacturers receive and process orders, plan production programs for those orders, and deliver the final product to customers. And this enhanced efficiency has resulted in more cost-effective and productive business models across a company’s entire value stream.  

But until now, there has been one touch point that’s been slow to adopt digitization: manufacturing.

However, with the proliferation of digital technology and advancements as to how it can be applied to the manufacturing link of the supply chain, OEMs now have the tools to implement digital elements into their production processes and facilities in order to reap the same benefits other portions of the value chain have been experiencing for years.

Next time you’re doing laundry, take a look at the inside label on one of your shirts. These labels usually contain a wealth of information about the shirt like the size, the kind of and proportion of material used in creating it, place of origin or production, washing instructions, and more. And if you were so inclined, you could easily sort your entire wardrobe using these parameters and make decisions on the best clothing choices for each day based on these data sets.

When it comes to manufacturing and supply logistics, the concept of Plan for Every Part (PFEP) is essentially a shirt tag for reducing the complexity of the production and supply stream and increasing productivity and cost-effective decision making. Just as those small tags inside your shirt are the DNA of the garment, so goes PFEP for intelligent demand and planning capabilities, especially for variant rich or mixed production operations looking to retain competitiveness in a 21st Century manufacturing and supply landscape.