Greater connectivity: the supply chain opportunity that 4IR offers

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The 4th Industrial Revolution stands to benefit the manufacturing industry in many ways, not the least of these benefits being a better connected supply chain and better access to real customer data. EEF Consultancy Director Martin Strutt explains more.

Martin-supply-chain 

Modern manufacturing is built on a complex supply chain network and manufacturers’ success is closely linked to the success of these relationships, which face a new era of connectivity with the advent of the digital revolution.

The recent EEF/NatWest Manufacturing Ambitions report found that while the growth plans of UK manufacturers are extensive, a number of things needs to happen for these ambitions to be supported. This includes better collaboration and cooperation through the supply chain from developing new products and service propositions, to developing in new technologies and investing in digitally connected equipment.

The key thing that the 4th Industrial Revolution promises is much greater connectivity across supply chains and greater visibility of real customer data. This leads to better, more optimal planning of factories which in turn leads to better efficiencies and better working capital.

The closer a business is to its customer, the closer it understands exactly what is needed at the point of consumption, then the much better you can plan a factory. Instead of guessing with forecasts and buffer stops, manufacturers would be working with true data and true demand which leads to greater efficiencies.

What does this mean for customer demand?

There’s going to be an expectation from the customer that lead times are going to shorten and businesses will need to flexible to meet higher demand. The fact that this gives a business greater visibility of customer demand is a real benefit. On the other hand, customers are going to become more demanding because they’re expecting things to be delivered quicker.

This is a challenge. But the fact that you’re working from real data gives manufacturers a great advantage and gives more certainty about what is being done. So it’s a challenge manufacturers are more than capable of rising to.

We’re already seeing automated connectivity along the supply chain. For example in food and drinks sector, factories are receiving Electronic Point of Sales (EPOS) data from supermarkets (which is true end-customer data) to plan their factories and processes more efficiently. We’re also seeing this connectivity in automotive assembly cells, which are electronically ordering replacement components from suppliers.

How can manufacturers start preparing?

The key thing about this greater connectivity is the greater transparency of data that will be a result. So manufacturers need to start thinking about the data they want to share and need to take heed of what they want to release.

Is your business ready for the digital revolution?
Explore our resources and guidance to help you navigate and understand what the 4th Industrial Revolution means for manufacturing.

 

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