Supply Chain 4.0

Supply Chain 4.0

In order to understand what Supply Chain 4.0 is, we should have first understood what Industry 4.0 is.

Industry 4.0

While the modern industry was developing, three great industrial revolutions took place; the invention of mechanical workbenches working with water and steam in the 18th century, mass production in the 20th century with the use of electricity and the production line, and automation with programmable machines in the 1970s. Industry 4.0 is predicted to be the fourth industrial revolution. This concept was first used in 2011 at the Hannover Fair in Germany. The report, in which Industry 4.0 took place for the first time, stated the 20-year plan of Germany's industry. Industry 4.0 was adapted and started to be used for many sectors following the fair in Germany, such as Agriculture 4.0, Logistics 4.0, and Supply Chain 4.0.

The main idea of ​​Industry 4.0 is to realize the transformation of information technologies in the industry. The two key components of this idea are next-generation software and hardware and the internet of things. In this way, structures that are lower cost, energy-efficient, sustainable, measurable, traceable, minimizing risks, strengthening competition in international markets, allowing to follow the dynamics in the economy instantly, and smart factories with integrated smart cyber-physical systems can be adopted.

Supply Chain 4.0

One of the concepts that emerged following the concept of Industry 4.0 was Supply Chain 4.0. Supply chain 4.0 stands for the digitization and automation of processes between supplier, manufacturer, and customer. Supply chain 4.0 covers all steps from the time the ordered product is shipped to the end of the product's lifetime of usage. The supply chain is concerned with the purchasing, processing, production, and shipping of raw materials to customers, and concerns all parties involved in these processes: suppliers, factories, warehouses and distribution centers, retailers, and end users. Supply chain management, on the other hand, ensures that all parties involved in the supply chain are properly integrated and is concerned with controlling these activities. The supply chain is a very complex and large network due to its structure, and it is important to transport materials quickly with an efficient information flow.

Changes in the Supply Chain

In general, this information technology transformation in the supply chain can be reflected in the form of data transparency in the areas of performance management and forecasting. In other words, we can expect the data flow regarding the status of the products, prices, stocks, sales to continue in a transparent and uninterrupted manner.

Transformations in the logistics part of the facility will include mobile conveyor belts to increase efficiency in internal transportation, smart transportation routes created for unmanned vehicles and vehicles in the facility, robot technologies, computer-aided modeling and design, three-dimensional modeling and production with printers, advanced planning in order-based production, stock-free and also more efficient and intensive use of kanban charts, the kazien method. In the same way, we can expect developments that will enable instant collection of orders in storage areas, make them instantly trackable, provide instant notification to the manufacturer and supplier of missing parts, cross-load the products from the supplier and exit the warehouses instantly. In addition to these, we will see structures in which optimization-based collection algorithms are used in storage areas such as light collection, sound guided storage, automatic storage, and retrieval systems, in the digitalization processes of the supply process.

Transformations in distribution and transportation include processes such as rapidly operating production lines for supply logistics, creating stock-free structures, synchronizing suppliers' production lines with their own production plans, developing demand-based plans by supporting them with smart systems, and developing software and connections for traceability and planning. Additionally, logistics companies will and should equip their vehicles technologically for on-time picking and delivery, optimizing connection points by focusing on consolidation, vehicle tracking systems are developed and location, arrival time, tachograph management, fuel economy, maintenance planning, driving efficiency, driver performance, road condition, route adapting to a holistic ecosystem, such as planning, will also be a part of these transformations. In these processes, we can also say that the deliveries will reach the customers in a more personalized way.

Finally, we will see the transformations in the international shipping section as containers and vehicles track the load they carry with instant systems. In addition, there will be a progressive transformation towards systems such as automatic sorting of products to be transferred at the destinations of vehicles and containers.

In which part of this change does Turkey stand?

We can say that the place where Turkey stands for Industry 4.0 contrary to the three industrial revolutions in the past is promising. According to the report titled "CEO's Perspective on Digital Transformation in Turkey" published in 2016, the digital maturity level of companies from various sectors is stated as "7% of them are entry, 59% are developing and 34% have an advanced digital structure". In addition, according to the same report, it is stated that companies allocate 27% of their investments to digital development.

Of course, the transformation of information technologies in the industry cannot be considered only on the basis of companies, this process can only be completed when the parties with which the companies work together, as well as the companies, go through the mentioned technological transformations. For this reason, Industry 4.0 has brought concepts such as Agriculture 4.0, Logistics 4.0, and Supply Chain 4.0.

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