In the ever-evolving world of logistics and supply chain management, companies are forced to continually adapt to stay ahead of the curve. Driven by the increasing demand for online ordering and fast delivery, the industry has been developing concepts and visions for some time to be able to meet this demand. Delivery drones, autonomous delivery robots and pipeline systems for mail are the talk of the town – and the first field tests are already underway. Another aspect keeping the industry on its toes is the ever-increasing desire for customized products.
It is therefore fairly obvious that the supply chains of the future will be much more complex than the ones we know today. One indication is the change in suppliers and distributors networks. If you compare how many nodes a company had in its supply chain network ten years ago and how many there are today, you can see that there has been tremendous growth. Conventional approaches to controlling production and logistics are therefore reaching their limits.
Amidst these challenges, digitization has emerged as a key enabler for modern supply chains, allowing for real-time management and monitoring for the first time and holding the potential to create seamless omnichannel retail experiences. But, as evidenced by a recent survey of more than 300 executives and leaders by consulting firm PwC¹, the use of digitization and technology has left results below expectations for an overwhelming majority of 83% of survey participants. Spoiler alert: There are specific reasons for this, and we will break it down a crucial one within this article.
Buzz or revolution: Will the 4th industrial age hold the answer to all questions?
What prevents our production and logistics from collapsing under the allegedly unmanageable complexity of our time? Many experts see the decisive lever in the transition to a new form of business characterized by digitization, Industry 4.0 – the fourth industrial revolution. In a more specific context, Industry 4.0 represents the interconnected factory, where machines, components, and production orders continuously share information to facilitate agile and efficient manufacturing processes.
But how did we get here and what are the main aspects of Industry 4.0? Enjoy a short journey down memory lane: The first industrial revolution introduced us to the power of water and steam, while the second revolution brought the transformative force of electrification. Fast forward to “Industry 3.0,” and we were introduced to the marvels of electronics and information technology.
Today, we stand on the cusp of the fourth industrial revolution, where “cyber-physical systems” or “smart objects” take center stage. These objects, embedded with software and electronics, communicate and network with each other via the internet. Capable of collecting data from their surroundings through sensors and interacting with their environment via actuators, they convert electrical signals into mechanical movements. A prime example of these advanced cyber-physical systems is Google’s self-driving cars, which can perceive their own traffic situation, continuously gather data from the internet, and ultimately navigate themselves safely and autonomously to their destination.
Wait a minute – how exactly can smart objects protect us from complexity collapse?
When a system becomes too complex to be controlled from a centralized location, then control must be handed over to a more local level. This does not mean introducing many levels of hierarchy, all of which must be managed manually. Far from it: In terms of industrial production, it means that production controls itself independently and autonomously.
For this purpose, systems are established that can track all assets (= smart objects) and processes and control production fully automatically in real-time. Delivery delays are detected immediately, additional required capacities are allocated autonomously and unavoidable setbacks are communicated to the customer immediately. There is comprehensive information sharing and independent planning of production processes, as well as maintenance and repair requirements.
Smart objects that communicate with each other and are able to act autonomously within the framework of the specified requirements: That is the actual core of the Industry 4.0 vision. It is expected to enable efficient production in smaller quantities while providing a higher degree of product personalization at cost-effective prices.
The approach of Industry 4.0 companies is now to rethink the entire value chain from the smart object. In the future, industrial plants, containers, production machines, products and materials should have embedded intelligence and communicate with their environment.
The dream of a fully automated real-time supply chain takes time and comes with a paradigm shift
The complete realization of this vision is a long-term endeavor, spanning several decades. There is still a long way to go from today’s conventional warehouse operations, where orders are processed according to the “man to goods” principle, to the fully automated shipping center of the future. But there is little doubt that employees who take care of the order and commissioners or pickers, who move through the warehouse and assemble pallets or packages will be an unsustainable phase-out model. Instead, robots will take over the role of pickers, swiftly navigating through aisles, assembling orders, and packaging them at designated handover points. Ideally, this process will culminate in a fully loaded truck, ready for dispatch.
In order to achieve the elevated responsiveness that is essential to Industry 4.0, a critical requirement must be met: a radical improvement in supply chain transparency. Rather than relying on traditional planning methods that use models, future planning should leverage near-real-time data. This approach would ideally equip companies with a detailed and up-to-date understanding of all ongoing processes within their value chain. Consequently, organizations can manage their supply chains based on concrete facts rather than mere assumptions, driving more effective and informed decision-making.
And what about the people who were previously an integral part of the supply chain, you may be asking. Well, as automation and technology continue to advance, the nature of work will change significantly. Smart objects enabling machines to take over routine tasks will reduce human involvement significantly in many production areas. This shift, however, presents an opportunity for human workers to focus on other important aspects, such as creative problem solving and strategic planning, and fostering interpersonal relationships. By eliminating repetitive, tiring work, workers can concentrate on tasks that require critical thinking, adaptability, and emotional intelligence—qualities that machines have yet to master. Experts assume that this evolution of the workforce will not only lead to increased efficiency and productivity but also enable individuals to engage in more fulfilling and meaningful work experiences.
Leveraging the treasure of smart objects: Let’s talk about location data
We have learned that in modern industrial environments of the future, all assets in a supply chain will be “smart objects”. An important aspect is that these assets know their exact location – and share it with the connected systems via wireless technologies like GPS, UWB, BLE, and more. And you’re probably still waiting for an answer to the question of why 83% of executives are not yet satisfied with the progress achieved through digitization.
It sounds almost trivial, but it’s common in nearly every manufacturing facility: There is no central location, no single point of truth, where location data is aggregated, evaluated and used to optimize and autonomize supply chain operations. Instead, it is common that the digitization of assets is accompanied by the implementation of a dedicated tracking system. This means that only certain asset groups and parts of the supply chain are tracked transparently, because the systems used are often not compatible with each other and therefore do not provide the option of combining location data across the entire value chain in one central interface.
This, of course, is completely counterproductive to the vision of a supply chain that can be controlled and adapted in real time. The impact is obvious: location data arrives only in fragments in different systems and possibly in different departments, so that few insights can be gained for the optimization and automation of the production process. Therefore, system interoperability is key. Once established, it enables companies to start converting (location) data into valuable information that can give the Industry 4.0 vision a real boost and corporate decision-makers investing in technology tangible signals of impact.
Introducing the omlox standard as a game changer for real-time location system (RTLS) interoperability
You wonder why nobody has thought of making different RTL systems compatible with each other in order to create maximum location data efficiency? Good news are just around the corner: Developed by a consortium of industry leaders, omlox is a universal and open standard that is able to integrate different types of locating technologies, including GPS, Bluetooth Low Energy (BLE), and Ultra-Wideband (UWB) irrespective of the vendor. This means that different systems can be mixed and matched as needed to create holistic solutions. For example, a company could use GPS for tracking shipments across long distances outdoors, and then seamlessly switch to UWB for tracking inventory in a warehouse.
Talking about interoperability also means talking about scalability. omlox is designed to support systems of any size, from small-scale deployments in individual facilities to large-scale implementations across multiple sites and even entire supply chains. This means that organizations can use omlox to create a consistent and standardized approach to location data across their entire supply chain, improving efficiency and reducing errors on a global scale.
By providing a universal framework for different systems to communicate and work together, it can help to streamline processes and reduce costs, while ensuring that the efficiency of different infrastructures is maximized. As more organizations adopt the standard, we are already seeing increased collaboration and innovation in the supply chain management space, ultimately leading to better outcomes for businesses and consumers alike.
omlox sets the tone, the DeepHub orchestrates the band
Having an RTLS standard is only half the story. Similar to an orchestra, which knows in advance in which key the piece of music is to be played, a conductor is needed who controls the individual components and maintains an overview at all times. This is exactly what Flowcate’s DeepHub does.
DeepHub is the premier omlox middleware solution, consuming indoor and outdoor location data from any technology and transforming it into standardized, georeferenced coordinates. This data is pushed to any type of IoT solution or application (ERP, WMS, MES etc.) through a single API. By harnessing the interoperability of the omlox standard, an IoT solution powered by the DeepHub is guaranteed to be technology and vendor-agnostic.
Let’s illustrate this with the example of “Geofencing”: Geofencing is a location-based service that triggers an action when an asset enters or exits a spatially-defined location. It can be used to define process steps in a way that assets entering or leaving a dedicated geofence automatically trigger processes, thereby eliminating manual steps. This enables automatically controlled just-in-time production.
In order to work smoothly, different systems and technologies within the just-in-time supply chain must communicate with each other within the geofencing environment. This is made possible by omlox. The DeepHub consolidates the location data to ensure that the interaction is set up efficiently, and can be constantly monitored and further optimized. This provides location-based process automation in material flow. Users can receive notifications informing them of the movement of materials, shedding light on how long each process step takes, where bottlenecks exist, and ultimately – where improvements need to be made.
Organizing the supply chain of the future means “less is more”
The near future presents us with major challenges: Consumer expectations are constantly rising, supply chains and procurement channels are and will remain global, and there are fewer and fewer people who can manage complex supply chain systems. Industry 4.0 is a promising attempt to maintain or even increase productivity despite ever more difficult conditions. Process automation is the key to success here. As we have seen in this article, almost every industrial company is involved with automation technologies – but the associated expectations cannot yet be fully met.
A key reason is the lack of interoperability between different systems and technologies, not only in the supply chain, but especially there. Smart objects, i.e. assets equipped with location technology, are only as smart as the system landscape they are connected to. Companies that prioritize harmonizing these systems and technologies will quickly gain a competitive edge while saving resources and costs. Standardization solutions such as omlox in combination with interfaces or data aggregators such as DeepHub are designed exactly for these use cases and ensure that companies achieve more with less.
Get in touch with Flowcate experts and learn more about omlox and the DeepHub.