LOGISTICS 4.0 IS MAKING SPACE TO SUPPLY CHAIN 5.0: ARE WE READY?

The concept of industry 4.0 is strictly linked to the so-called Fourth Industrial Revolution that has its origins in 2011, when the digitization of industrial processes began the transformation that eventually lead to enhanced business productivity and flexibility. In this context, in order to respond to an increasingly efficient production, logistics 4.0 became an essential asset. Despite not having an official definition yet, we could state that every activity encompassing the planning, the storage flow of raw materials, semi-finished and finished products, in order to meet customer requirements via the use of enabling technologies, is part of this recent approach to logistics.

As far as automation, connection and decision making are concerned, the introduction of advanced robotics, A.I., Internet of Things, Big Data Analysis and augmented reality brought important changes to the supply chain sector. These innovations fostered major improvements in four areas. A more efficient handling of raw materials, semi-finished and finished products, combined with a wider availability of data, lead to an improvement in production and traceability. Safety benefitted from it as well, reducing at the same time the risk of litigation with customers. Last but not least, the sum of all these benefits lead to an estimated cost reduction of about 30%.

According to the most recent literature, companies that are still struggling to cope with these changes are the ones which do not promote an internal culture of constant learning and understanding, especially when it comes to Big Data Analytics. As a new revolution is on our doorstep, a different cultural approach becomes necessary. It is the so-called Lean Thinking, a transformational framework which integrates in a very holistic way improved management of human resources, optimization of the entire supply chain and a constant update of all the players involved.

Since industry 5.0 will pair all these highly automated, connected and intelligent digital ecosystems with a human touch, this interaction should be leveraged in a way that maximizes both the input from the people and the one coming from the new technologies involved in the process, in order to deliver greater value to customers faster.