Benefits of the smart supply chain. how supply chain professionals can help create a smart factory.

Author:Davies, Bob

In the animal kingdom many animals store food to see them through the difficult winter period, but in the case of the Gray Squirrel it has been shown that 74 per cent of their buried stores fail to be recovered. In the age of accelerated industrial obsolescence, some manufacturers have taken a similar approach, stockpiling spare parts for their industrial automation systems in case of equipment failure later on. Using a more modern approach can streamline this process by maximising factory space and minimising waste.

When SIEMENS and the German Government created the concept of Industry 4.0, they played heavily on the idea of the smart factory, in which the whole facility is integrated, connected, intelligent analytics orientated and focussed on reducing downtime and waste. The idea of lean manufacturing itself, a method for lessening production waste, has been around for much longer--it was developed by Toyota executive, Taiichi Ohno and first implemented shortly after World War I.

Worryingly, a recent report by the Institution of Mechanical Engineers found that 92 per cent of UK manufacturers do not have significant understanding of Industry 4.0 processes, even though 59 per cent recognise the impact it will have on the sector. This leaves UK manufacturers at risk of falling out of step with international manufacturing businesses, who are embracing the factory of the future and the intelligent connected systems presented by Industry 4.0 as essential for competition on an international level.

So, how can manufacturers fully embrace the smart factory concept? One of the key steps in the process involves incorporating sensors into equipment to connect them to the internet of things (IoT). However, communication alone is not enough for a plant to define itself as a fully intelligent factory if the communication is limited to the factory floor.

Decision making at all stages of the manufacturing and distribution process--including the supply chain--can be made using complex analytics that don't require human intervention. Two simple ways in which using a smart supply chain maximises the benefits of the smart factory are cost and space savings.

Predict bottlenecks

The smart supply chain system is both self organising and self optimising. Data from connected sensors in the factory can be integrated with data on user preferences, data on weather and any information on any other variables that enter the system. A smart system can predict a...

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