Era 4.0 – Supply Chain completely Networked

Industry 4.0, Production 4.0, Logistics 4.0 – the number “4.0” is in vogue in the different industry segments. It stands for digitalization and networking. Which opportunities arise from it, but also which risks?

The goal of data mining is to evaluate existing machine data more effectively to identify and eliminate root causes. Photo: Bosch

According to the usual counting method, Industry 1.0 (or: the first Industrial Revolution) arose from the steam engine and the consequent mass production. Industry 2.0 was characterized by electrification and the production lane. Industry 3.0 came into being with the introduction of computers and dawning automation. Industry 4.0 finally is characterized by networking.

Machines, supply chains, business partners and customers are interwoven through information- and communication technology – and with them order- and production processes, added value and logistics. The term Industry 4.0 was probably used for the first time by the “Research Union Science – Economy”, put into action by the then acting German Federal Government.

Digitalization and Networking take place along the whole “Supply Chain”, from the sourcing of resources and primary products by order management, over production and storage to delivery logistics, use and maintenance.  Along with gains in efficiency and process optimization, they promise novelties in products, forms of production, organization and distribution – and therefore new business models.

Seven elements describe the supply chain. Photo: Fotolia – Trüffelpix

Booming Market Especially for Solution Providers

 Practically all providers of industrial machines, like Bosch, MAN, Siemens, ThyssenKrupp, Voith and many more are focusing on the trending topic of Industry 4.0. But the IT and telecommunication industry also want to partake in this new and growing market. Taking on the issue are for instance Deutsche Telekom and their daughter T-Systems, but also Amazon, Google, Hewlett-Packard, IBM, Microsoft, Salesforce, Samsung, SAP and Toshiba. And beyond that hundreds of highly specialized medium-sized service providers. “Industry 4.0 will become standard in the manufacturing industry and the IT-providers are a main driver”, says Michael Kleinemeier, presidium member with sector association Bitkom. Felix Müller, project manager with the Fraunhofer Institute for Production Technology and Automation (IPA) in Stuttgart warns though, that the topic is often presented in a much too theoretical way. Hence, practical and directly realizable solutions are needed.

Industry 4.0: From “Batch Size One“ to the Humane Workplace

 The linkage of order systems, machines, sensors and other components in the industrial production is considered the trailblazer for the frequently quoted “Batch Size One”. Meaning, that the customer can already make customizations when ordering. Thanks to digital transmission of the special requests from the order system to the production lane, “smart factories” then specifically produce this one piece.

Sensor data, collected during production, promise an increased information transparency, so that production planners and management have an up to date overview of capacities, error rates and other parameters at all times. In addition, machine sensor systems can detect shortages of primary products or maintenance requirements early on.

Augmented reality: A tablet worker checks items in the boxes. Photo: Fotolia – Zapp2Photo

Depending on the industrial branch, digitalization also includes the cooperation between man and machine – for example in form of assistance systems, supporting the human worker. This begins with the provision of real-time information and ranges to cyber-physical support solutions. For that matter, companies like Audi are already utilizing Exo-Skeletons – robotic suits or support equipment, which assist humans in physically strenuous work. With that, however, new requirements in terms of work safety and work organization arise: when humans and robots work in the same vicinity, sensors and auto-shutdown mechanisms must ensure, that no human is injured by a robot. DEKRA, whose main areas of responsibilities include work safety, as well as plant-, machine-, and device safety have also adapted to these new challenges.

Logistics 4.0: On Time, Reliable and Efficient

Just like the field of production, logistics are also being changed by networking and digitalization. “Affected are communication and cooperation with customers and partners, as well as planning and management of delivery and freight traffic on roads or rails”, explains Dr. Armin Günther, manager “research & innovation strategy transport and logistics” with DB Schenker. The interconnection of all supply chain partners promised increased efficiency, transparency, flexibility and production speed. On the other hand, concepts like Just-in-time-production – the on-time supply of materials or primary products to the production lane – aren’t new. But now, they are complemented by software-assistants and physical assistance systems like sensors, detectors and product tracking along the whole transport route. And the industry is already considering the future effects of autonomous transport vehicles and -systems on their business models. The latter are still dreams of the future – but digital delivery notes instead of paper documents or the electronic linkage of drivers and vehicles for purposes of route-optimization and prevention of empty runs have been around for a long time.

Challenge IT-Safety

 The digitalization at all positions of the production and supply chain also leads to new challenges – for example in IT-safety. For the cross-linked systems are also a target for hackers, digital saboteurs and racketeers. The higher the involved values, the more attractive such attacks become to cyber-criminals. Thus, an important field of activity emerges for IT-suppliers and -servicers. In that context, T-Systems just presented a Honeypot-solution for interconnected industrial systems: the security system attracts digital attacks on industry-typical protocols and interfaces. If it detects attempts of that kind, it can give the alarm and thusly enable companies, IT-servicers and network providers to take counter measures immediately. This example shows, that the digitalized supply chain also bears new risks and challenges, which, in spite of all advantages and opportunities, companies and suppliers must encounter specifically.