Industry 4.0 gives opportunity for large enterprises to achieve significant cost savings via efficiencies but lack of visibility in the traditional supply chain is an obstacle, cautions Martin Keenan of Avnet Abacus...
The European Parliament has estimated that Industry 4.0 can effectively raise manufacturing efficiency between 6% and 8%. Furthermore, IIoT in manufacturing could add US$ 1.3 trillion of value by 2020 in global manufacturing.
This universally positive outlook is very compelling, but is broadly based around the ability of IIoT and AI to combine to find tiny efficiencies throughout the supply chain. Yet an IBM survey found that 84% of chief supply chain officers believe that “lack of visibility” across their supply chain was the biggest challenge they faced.
In order to achieve visibility of the entire supply chain it’s necessary to be able to track products and components pretty much from their creation through to the end user, a feat that is much more complex than it might first appear. Given the global nature of business today, the system needs to be potentially able to reach all corners of the planet, but also boast long battery life, which is where the challenge really starts.
Traditional GSM and GPS network tracking ticks most of the boxes, but it’s power-hungry, and in many cases data-hungry too, creating additional overhead costs that can mount up. There’s plenty of buzz and anticipation around 5G networks and their potential applications, but, while very low latency is a boon for tracking purposes, high power use is prohibitive in all but vehicle tracking applications, and data costs are likely to exceed GSM or LTE.
Meanwhile, the once-totemic RFID may be in widespread use, but is unfortunately somewhat restricted in range. Battery life may not be an issue, but this places pressure on the powered readers, which need to be installed relatively densely (and/or have their range boosted with antennas), as well as IP networked and integrated. In short, RFID is not practical for use in wider environments.
This is where the new breeds of LPWAN/loRaWAN technologies such as hybrid NBIoT trackers can really deliver, a fact bourne out by the wide range of competitors offering solutions in this space.
However, choosing the right solution for your business needs is still a complex matter. Even a simple example - say a component tape on a pallet - raises multiple challenges for supply chain efficiency. Most current scenarios are based around tracking the product through a fulfillment system, but many of these are reliant on barcode or tag scanning at hubs, often tracking a larger cage of items before breaking that down nearer the end user; a system that has obvious flaws in accuracy, as well as limitations in visibility pre-network-entry scan and post-delivery.
Then there is the question of the pallets and cages themselves, and how these are managed. The cost of Returnable Industrial Packaging (RIP) is a significant contributor to logistics operational costs, impacting the whole value chain.
Interestingly, the search for full supply chain visibility is gathering pace for environmental reasons as well as financial ones. The concept of zero-waste and closed loop manufacturing principles are making it essential that packaging and transport materials are not only returnable, but also actively collected and frictionlessly transported to where they’re most needed in advance. These concepts are only just beginning to have an impact on business thinking in general, with initiatives such as the Ellen MacArthur Foundation’s Circulytics metrics. The future will contain many challenges for the Industry 4.0 supply chain, but the solution to much of those will be based on visibility.
Martin Keenan is technical director at Avnet Abacus