Supply chain 4.0
Master all the details that surround the 4.0 supply chain, so important for any company, keeping you aware of the transformations that are modernizing the area.
How Slowbalisation affects the supply chain
How Slowbalisation affects the supply chain
The term Slowbalisation, created to describe the slowdown in international trade, is on the rise.
Since the early 1990s, when globalization began, it has driven economic growth. Today, however, global trade is slowing down and occurring in more regional terms.
What is the impact of this shrinkage on business and the supply chain? In this post, we will reflect on this topic. Check it out!
Why Slowbalisation is happening
In the 1990s, globalization gave rise to the idea of a flat world, where borders mattered little when it came to the flow of ideas, goods, services and capital.
Development in the technology, communication and transportation sectors reinforced this concept, suggesting a world increasingly connected.
But in recent years this movement has begun to slow down, giving rise to Slowbalisation. Why is that?
A conjunction of factors has led to this condition, among them, geopolitical changes. The advance of nationalist and protectionist governments, especially in the United States, has put globalization in the spotlight.
But that is not the only reason. The technological advance that has occurred in every corner of the planet has leveled products and services, making it easier for the final consumer to find what he or she needs in a place close to where they are located. This is because the same consumer, more aware and demanding, started to create a demand for customized products and faster deliveries.
Another determining factor for Slowbalisation is the high costs involved in purchasing raw materials. Especially fuel, which also interferes with the value of transporting goods.
Price fluctuations in the fuel market, in fact, constantly affect the logistics sector, generating inflation in the final price of products. They act as a kind of domino effect, where carriers increase their values in order to not suffer losses and purchasing companies pass on the same increase to the final price of products, in a compensation that affects the logistics chain.
And we must not forget that globalization has allowed emerging countries to become richer, being able to produce more and, of course, increase the consumption of their own goods – which leads us to conclude that it may have been a victim of their great success.
Slowbalisation X Supply Chain
During the 1990s and early 21st century, many companies defined their supply chains in the use of cheap labor, even if it was on the other side of the planet.
With the shift to just-in-time logistics, however, this type of decision changed, creating yet another reason for Slowbalisation.
The adoption of a model where stock is acquired as needed, operating at continuously low levels, helps to reduce costs and increase efficiency. However, it requires a very careful programming for the demand of products, avoiding shortage of materials – in our blog you find an article that shows what is the most beneficial for company finances in industry 4.0: buying products or services (CAPEX or OPEX)? It’s worth reading to find out!
Instead of large quantities of materials – purchased at lower prices in countries with lower labor costs – we now see came into play:
- local workforce, with greater qualification and knowledge of the production stages;
- technological solutions capable of planning and monitoring each stage of the production process, avoiding waste and interruptions due to lack of parts.
Indeed, regionalization relies on technological advances. The Industry 4.0 supply chain has become much smarter, incorporating data analysis, artificial intelligence and machine learning.
These capabilities generate increased visibility and control of the supply chain, allowing rapid identification of any failure that may affect it, making your operations more efficient and optimized.
And, for the future, it is quite reasonable to assume that new technologies will emerge to develop the supply chain according to the needs of different markets and decrease the dependency on products that today can only be found in more distant places. This is the case of the 3D printer, for example, among other innovative technologies we have already talked about in our blog – learn more about 4 technologies that will change global trade forever!
Reliable Supply Chain: essential in Slowbalisation
One of the main precautions to be taken with the supply chain in post-globalisation is to guarantee the availability of the materials needed for production.
This is already possible with the existing sophisticated technologies, which analyze the chain in real time, ensuring efficiency, agility and cost reduction – in this sense, know a proposal that unites reliability and speed at the time of purchasing your company.
But in the Slowbalisation era it is also essential to have an extended supply chain network. And the best way to guarantee this network is to count on the partnership of a company that can supply any item with the best price and term conditions.
Soluparts specializes in the acquisition of all types of industrial materials for maintenance, repairs and operations, facilitating the entire purchasing process.
Count on experienced professionals to make your supply chain much more efficient – even in times of Slowbalisation. Get a quote and surprise yourself with our service.
The second wave of Industry 4.0
Industry 4.0 is a term that echoes in our minds and, although it is relatively new, it is already changing. It is the so-called second wave of Industry 4.0 – the subject of this article. Keep up with us!
The concept of Industry 4.0 through the eyes of its creator
A “simple” explanation for the term is to say that it is the fusion of the digital, physical and virtual worlds. The definition is from the creator of Industry 4.0 – or “Fourth Industrial Revolution” – Henrik von Scheel, named by the Financial Times as one of the world’s leading authorities on strategy and competitiveness. According to him, these three realities have come together to promote the greatest structural change in the last 250 years.
Scheel developed Germany’s ‘Digital Agenda’ in 2008 at a time when the country was experiencing productivity difficulties and its economic growth was slowing down. The strategy was to bring together industry, universities and government and to draw up a roadmap for the economy, which would focus on increasing efficiency in all manufacturing sectors – you can find more details in the article of the author himself.
The intention was to increase Germany’s productivity and Gross Domestic Product (GDP) through greater efficiency in all sectors, based on technologies and applications that already existed at the time or that were becoming more successful. It worked. And it was the beginning of the Fourth Industrial Revolution.
For the considered “father” of the new industry, among the main results of the fusion of digital, physical and virtual realities are:
- An unparalleled growth in efficiency and productivity;
- A redefinition of the competitive landscape on a scale never seen before;
- The introduction of smart products and new service models;
- The creation of the next generation of operational excellence;
- Intelligent automation, complete connectivity and true alignment across the value chain.
The first wave of Industry 4.0 began in 2009. It was configured in the meeting of emerging technologies, involving digitalization, the Internet of Things, robotics and systems such as Advance Analytics and Cloud Computing – check out our article on technologies that are changing global trade.
However, since 2016, we already started living the second wave…
The second and current wave of Industry 4.0
The second and current wave of the new industry, on the other hand, goes even further. According to Henrik von Scheel – whose linkedin profile you can acess, it is focused on solutions such as, and mainly, Artificial Intelligence (AI) – in addition to Blockchain (asset-based), Intelligent Automation, 6G Communication, as well as new energy sources.
This phase of Industry 4.0 also brings a new era of operational excellence to industrial processes – that is, it transforms manufacturing, operations, product services, production systems and even design.
In this sense, parts, machines and human beings, well-connected – by advanced technological and digital solutions such as Artificial Intelligence, Intelligent Automation and 6 G Communication – will have the possibility to make production systems faster and more efficient and thus reach a level never seen before.
The leader in strategies and competitiveness states that the changes proposed by Industry 4.0 require managers to search for changes in their competitive model, increasing the ability to supply products at lower prices throughout the supply chain.
Scheel points out that “manufacturers need to rethink the entire value chain” and also “need to apply different thoughts and tool sets“. Henrik von Scheel also points out that there are only six different ways to model his manufacturing operations. These are: revenue, value, cost, performance, service, and operational model.
The human being at the centre of change
The authority on strategy and competitiveness makes another important observation: it is the human being, and not technology (as most people think), that is at the heart of the fourth industrial revolution.
“And while technology is certainly the main driver of the second wave, what may be the most fascinating thing about change happening today is the ability of AI technologies to put humans at the center of everything they strive to achieve. This sets it apart from the industrial revolutions of the past,” emphasizes Henrik von Scheel.
He points out that companies cannot delay the advance of their digital AI journeys because if they do, they fall behind their competitors who already adopt these competitive advantages – causing the gap between leaders and laggards to grow rapidly.
It is worth noting that a third wave of the 4.0 Industry is already being projected – this one, starting in 2025. It will involve Quantum Computing, Cybersecurity, Neurotechnology, Nanotechnology and Bioinformatics.
Now – knowing a little better about this redefinition of the competitive scenario – it is not difficult to conclude that the search for new equipment, parts, products and services (modern, updated and of the highest efficiency) is a necessity for the evolution of the industrial process. The company that wants to grow needs to be ahead of the competition.
Soluparts – a global company with offices in Brazil, Germany, Portugal, Hong Kong and the United States – can connect you to the most relevant manufacturers around the world.
We specialize in purchasing all types of industrial materials and have access to thousands of products and suppliers from around the world – learn more about our company!
To better understand how Soluparts can help your business connect with the fourth industrial revolution, contact our team of experts!
Benefits of an intelligent supply chain
With globalization – even as it is slowing down – and the digital transformation, the supply chain is becoming increasingly complex, increasing the pressures for a more modern and efficient process.
Therefore, it is essential to have an intelligent supply chain that exploits the digital and technological resources available today. Understand this scenario better with the following article.
Supply chain challenges in digital transformation
The spread of Industry 4.0 technologies has revolutionized supply chains that are already using the Internet of Things (IoT), automation, artificial intelligence and real-time analysis to optimize, accelerate and predict their operations.
In this scenario, many companies are already rethinking their logistics, taking advantage of digital technologies – and new rules, such as Incoterms 2020 – to keep pace with change and improve their operational capabilities.
Moving from a traditional supply chain to implementing a digital, intelligent format requires a major transformation.
To prepare for this moment, get to know the technological elements that are at your disposal.
Elements of a smart supply chain
Much has been said about using Bots, Artificial Intelligence and Machine Learning to make the supply chain more efficient – about this subject, we wrote an article that shows 4 technologies that are revolutionizing global trade.
All of them are very important indeed. But there are other resources available, like the ones we highlight below.
1. RFID – Radio Frequency Identification
The RFID system consists of an antenna, a transceiver (which reads the signal and transfers the information to a reader device) and an RF (radio frequency) tag, which contains the information to be transmitted – these tags may be present on products, parts, equipment, etc.
It works like this: the antenna emits a signal from the integrated circuit and transmits the information to the reader. It in turn converts the RFID radio waves into digital information, which can be read by a computer, storing this data.
Thus, it ensures professionals can control everything that enters and leaves the factory, which in turn guarantees the updated control of the stock – in real time – and makes tracking the materials a lot easier.
2. Smart sensors
As they are an excellent support for an intelligent supply chain, the sensors make it possible to monitor machines in real time, sending alerts to a control center if any part is defective and needs to be replaced – or even when the production period for any part is coming to an end.
This way, it allows the realization of predictive maintenance, indicating the right time for the acquisition of parts and products. In addition to cost reduction, it increases production efficiency, since it reduces the risks of having to stop the machines for maintenance.
It may sound complex, but tests are already being done using drones for delivery. Besides delivering orders to the buyer’s house, another possibility is the distribution from a truck which, upon arrival at a certain point of its route, releases several drones to deliver orders to places close to the stop.
Using a drone equipped with a camera to scan the items from a stock is also a possible way to improve controls and processes.
Repetitive tasks such as moving products from one area to another from a warehouse can be done with the help of robots, increasing efficiency and freeing up employees for more strategic work.
Amazon Robotics invested in this feature, reducing errors and costs (before, it was common for products and materials to be stored in the wrong place, leading to unnecessary purchase of items already in stock) in addition to improving efficiency – learn about the Kiva system that allowed the use of robotics in the company’s warehouses.
5. Process Integration
An intelligent supply chain needs to integrate steps and teams, creating a real-time communication that can be used by everyone in the production process.
This integration will promote improved communication, anticipation of problems, greater agility in detecting and solving failures. It also favors access to essential data to define strategies and control demands more effectively.
The market offers several options that need to be evaluated according to the needs and particularities of each organization. With Business Intelligence, information from systems in all areas and technologies – such as the Internet of Things – goes to the same dashboard, generating graphs and tables and allowing linked teams to follow the entire process together in real time – in the case of the supply chain, maintenance, purchasing and logistics would share the information in the same dashboard.
Implementing a smart supply chain in your company
The acquisition of new technologies requires good planning, avoiding risks such as acquiring items that do not offer a positive cost-benefit ratio or that are not really necessary for the reality of the business.
And although your journey towards a digital supply chain may require the best and most advanced technologies, remember that much of the success of this operation is connected to people. Companies need to take their employees with them at each stage, preparing their workforce for this new supply chain, through training, for example.
With these precautions, it’ll be possible to see many benefits in the supply chain, some of them being:
- Greater efficiency: better use of productive process time, minimized errors.
- Transparency: an intelligent supply chain allows information to be shared with all stakeholders in real time;
- Properly distributed resources: adequate quantity of parts, avoiding inactive stock or material shortages.
An intelligent supply chain can, for example, integrate data from sensors connected in warehouses and warehouses with information that shows the use of parts, allowing a purchase planning that leads to cost reduction and higher quality throughout the purchasing process.
Blockchain in procurement and the supply chain
Those who work in the purchasing and supply chain area have probably heard about cryptocurrency, bitcoin and blockchain.
With the rise of digital currency (bitcoin being the best known) in global trade, many companies begin to apply this technology in their operations in order to modernize, streamline and optimize processes. This ultimately brings new concepts and services to be replicated as demand requires.
The blockchain concept is relatively new and, in a simplified way, can be defined as a series of immutable data records, managed by a decentralized computer system that does not belong to any entity, this block of information is protected and linked to each other, using encryption.
Since this is a service that still generates many doubts and uncertainties, we have created this article to unveil this concept and its application in the purchasing department and supply chain.
What is Blockchain after all?
Before conceptualizing this technology, we need to talk briefly about bitcoin.
Decentralized cryptography – or electronic money – has been in use since 2008, when it was presented in The Cryptography Mailing discussion group by a programmer or group of programmers under the pseudonym Satoshi Nakamoto.
Bitcoin is considered the world’s first digital-decentralized currency, creating an alternative economic system. The currency does not need third parties to function, i.e. it does not depend on banks, large corporations or governments for the money to be moved.
Financial transactions with bitcoin are recorded in a distributed database – an extremely secure, decentralized network without a central management entity structure called a blockchain.
To illustrate, we can compare the blockchain to a public ledger (or accounting book) that records virtual currency transactions in a reliable and unchanging manner. It records information such as: the amount of currency traded, who sent it, who received it, when this transaction was made, and where in the book it is registered.
The service stores transaction information in blocks, stamping each block with a time and date record, thus being a chain of blocks. And what makes it so special is that it is not subject to a specific authority, but is a system in which the information is open to everyone who is part of it – everyone involved is responsible for their actions.
The main advantage of the service is that, with it, transactions are transparent, blocked and protected through encryption, making any attempt at fraud extremely difficult – but it’s good to point out that this does not make the system completely secure.
And since any modernization that brings agility and greater security to the purchasing process is beneficial, blockchain technology is increasingly seen as a potential market disrupter in purchasing and the supply chain.
Applying Blockchain in the purchasing department
According to MarketsAndMarkets consultancy, the blockchain market is expected to grow a lot in the coming years – the sector’s turnover will rise from $1.2 billion to $23.3 billion globally and the annual growth rate is 80.2%. Gartner has positioned the blockchain with great growth viability in the next five to ten years.
As we can see, innovations based on this technology are promising, with several ways and reasons for it to be applied in purchasing processes and supply chain. Let’s look at some of them:
A) Intelligent Contracts
Blockchain in purchasing allows the creation of intelligent contracts that are tamper-proof and automate actions to meet predetermined conditions. For example, payment terms incorporated into the contract automatically generate incoming and outgoing payment invoice notifications based on the approved data stored in the blockchain, eliminating the need for the supplier to issue the invoice and for the purchaser to validate it.
B) Information Reliability
The blockchain, as the name suggests, is a chain of blocks that stores digital information. For a new information to be incorporated into your database, you need to go through 3 steps:
- A transaction: an individual transaction is incorporated into a block that joins others to form a secure network of chained blocks, all of which carry a unique content. The big difference is that the later block adds its own content to the previous block’s fingerprint, generating its own fingerprint – and so on;
- Transaction verification: a computer network verifies each transaction to make sure it occurred as informed by the person responsible for the transaction. Only then is the process confirmed, joining thousands of other similar processes;
- Transaction identification with a code: finally the transaction receives an identification code, called a hash, and the block is added to the blockchain. The hash works as a kind of seal, if the block is changed, the hash changes, which invalidates that block.
After all these steps, the information is recorded in the ledger, from where it cannot be deleted.
In addition, each blockchain network has “nodes” that bring together participants for the same purpose – for example, bitcoin “nodes” are used to transfer money. And every time a person can validate a block or identify an error in the network, they receive a reward. These blockchain sentinels are called miners.
With all these precautions, the risks associated to traditional databases no longer exist, which offers security in the information exchanged via the blockchain and also making data tracking easier.
C) More transparency
Blockchain technology in purchasing also increases transparency throughout the process, since the record of all transactions cannot be changed by anyone without identifying the change. And if a transaction is malicious, it can be identified and treated before it becomes a damage to the business. Inspecting the network’s actions and pointing out suspicious modifications is another of the miners’ competencies.
Examples of blockchain in use in the supply chain
The use of blockchain in the supply chain is already a reality and has been creating benefits for many companies.
In the food and beverage industry, for example, Walmart’s supermarket chain has joined with IBM to track pork from China. Unilever, Nestlé and Dole have also used IBM’s experience and adopted IBM’s Blockchain to improve the traceability of foods such as bananas, chocolate and chicken – the blockchain records the origin of each item, where it is stored and its expiration date.
It has also been helping to track all stages of the global coffee trade, from farmer to consumer, collaborating to ensure the origin of the product and to reach a fairer price to the final consumer. Ireland’s Moyee Coffee was one of the first companies to innovate and use the technology.
It is clear that blockchain in purchasing and the supply chain will enable advances ranging from fraud protection to speed in the purchasing process. And even if innovation does not happen overnight, it is worth thinking about how to incorporate this technology into your company so that it will come out ahead.
Also, take the opportunity to optimize the purchasing process with Soluparts‘ experience. Present in five countries and negotiating with the world’s largest suppliers, our experts will guarantee you the best business conditions.
Robotics: role of robots in the modern supply chain
The increasing use of technology that marks the so-called Industry 4.0, has been discussed by different economic sectors in order to meet the global changes that have occurred in recent decades.
This concern has been reinforced recently as a result of the Covid-19 pandemic, which has impacted (and will continue to impact, according to forecasts) our lives over the coming years.
There are several examples of technological advances and challenges that are happening in areas of the economy. In the supply chain, for example, one of the challenges is the automation of activities that are done by humans.
According to a DHL study on robotics in logistics, around 80% of operations center activities are still done manually, but this number will change dramatically in the near future.
Experiences are already being made in this regard and you will learn about some of them by reading this article. Come take a look!
Impact of robotics on the supply chain
A recent post from the RoboticsBiz portal, specialized in the subject, says that there are two relevant issues related to the modern supply chain: the first one refers to the growing need for technology to handle the quantity of deliveries (for example, data prove the increase in demand for online retail sales in countries like the United States, China, France, Germany, United Kingdom, among others). The second, on the other hand, points to the reduction in the availability of skilled labor focused on this type of service.
Forbes magazine also recently published an article on the subject, discussing the impacts of autonomous technology on the supply chain, by helping to transport goods without human participation (or with reduced interference) and more accurate inventory control.
Until recently, there were many technological difficulties for the implementation of robots in supply chains and logistics activities. However, this issue is developing rapidly and today we can see robots that have a high degree of accuracy in their functions, which helps to reduce costs and increase productivity.
Besides the use of robots in warehouses, a subject previously discussed in an article about the benefits of an intelligent supply chain, there are other solutions being developed that are in different stages of improvement and are also important for the modern supply chain. Check out some of them below.
1. Store Robots
There are already some cases of mobile robots and drones in stores, helping to control the stock and price of products on the shelves. Recently, Walmart announced it will use Bossa Nova Robotics company robots to carry out these activities, making the work of its units’ employees easier.
2. Autonomous trucks
Case studies of the use of stand-alone trucks, such as in iron mines in Australia, show that they can help increase the efficiency of companies and the safety of teams.
Several development tests of autonomous trucks have already been conducted in recent years. Uber, for example, has already conducted a successful experiment three years ago, but has decided to prioritize other fronts of its business – other important players in the stand-alone truck market are: Embark, Daimler/Mercedes, Volvo, Tesla and TuSimple.
However, there are a number of obstacles to this type of activity: there is a significant risk of accidents that can lead to people dying. The public perception of the safety of this type of vehicle is a crucial point that will influence the future of autonomous trucks.
Another challenge is to reduce investments in the development of autonomous trucks. Starsky Robots is a case in point: it has had successful experiences with this type of truck in recent years, but it is closing its activities because of the reduction of financial contributions.
One possibility for the future is the change of focus, from totally autonomous vehicles to simpler semi-autonomous models, which will allow the reduction of human action, with the participation of robots in certain stages of the supply chain.
3. Autonomous deliveries
The delivery system (among them the “last mile” from the distribution center to the customer) becomes more complex with the increasing demand for home delivery, which creates the need for investments in automation to reduce costs and support workers in order to increase productivity.
Several companies are already testing this technology in cities and university campuses. The idea is that robots take the order to people’s homes, and one must type a code to release the product that is in the trunk. Ford, for example, has been testing the technology to feel the reception of customers regarding this type of delivery.
It is important to note that robots can also help workers with more complex deliveries, with the use of exoskeletons that will help lift and handle larger and heavier loads. Drones can also be used for deliveries, in cases of people living in remote locations. And robots will be able to receive the order in the customers’ homes, in case they are not available.
4. Autonomous freight trains
Tests have also been conducted in the United States for this type of autonomous transport. Federal regulations in the country are tending towards a release of the product, however, the authorities reinforce the need for anti-collision technologies to avoid accidents. As a solution, cargo transportation companies have already begun to implement Artificial Intelligence and Machine Learning systems in their safety protocols.
Challenges for the future
There are a number of initiatives that are promoting increased automation in the supply chain. For the improvement of this activity, advanced technology centers are being created to stimulate innovation and development of solutions (such as Honeywell Robots in the United States).
For example, an important new feature predicted is that the robots of the future will be connected to the cloud, which allows even greater control and accuracy in their tasks.
Challenges such as public perception, security and law enforcement will have to be addressed, including in the supply chain. However, experts indicate a promising future for this area.
The use of robots in the supply chain is still at an early stage, but promises to offer many facilities to companies.
Discover the 5 trends that are revolutionizing supply chains
In order to stand out and remain competitive in this digital age, it is needed to be aware of new trends and innovations. For this reason, Soluparts has prepared articles with the main trends of the new decade for you to rethink, reframe and revolutionize your supply chain and purchasing department. Enjoy!
Immersive Technologies in Supply-Chain management
6 tips to develop agile supply chain in your company
How to apply Circular Economy concept in supply chain
The impact of shared economy on supply chain
How to apply Agile methodology in the purchasing department
How to make Supply Chain more ethical?