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Industry 4.0 Technologies Ensure Visibility

Mon, 08/07/2017 - 12:17

Q: How does ConaLog help its members improve their logistics processes?

A: ConaLog’s goal is to develop the competitiveness of Mexico’s logistics sector through the exchange of best practices developed by its many associates. ConaLog focuses on linking academic institutions, the logistics industry and the public sector by establishing impartial triple-helix strategies that benefit all players. For instance, the council is promoting a working plan based on an assessment of warehousing and logistics needs that was developed in association with the International Youth Foundation and a large logistics provider. This research impacted the academic plans at CONALEP, thus allowing 300 warehouse technicians to graduate with skills endorsed by the industry.

Q: How should logistics operators and their clients work together to maximize efficiencies?

A: Collaboration is the name of the game. This means mapping all players and their contribution to the value chain. For Mexico to play a significant role as a logistics hub, the country needs to develop its infrastructure, as well as lean and agile corporations that live up to the demands of the logistics market in terms of reaction speed and efficiency. Next comes technology. It is impossible to have a collaborative economic environment if there are no technical platforms that generate the visibility that the value chain requires. To maximize efficiency, it is necessary to be aware of what is going on everywhere at all times. Visibility is achieved when a supply chain in any sector can integrate all Industry 4.0 technologies to ensure total traceability. To that end, blockchain could be a great addition for its ability to decentralize and democratize data so all members of the chain can use it to meet their goals.

This level of integration is commonly found in the consumer goods sector, where many companies and brands have an active and direct communication with consumers. In the case of the automotive industry, it is important for client demands to trickle down the supply chain so component suppliers can know what is behind changes in technical specifications. The automotive industry is at the forefront of supply chain integration given OEMs’ communication with Tier 1 and Tier 2 suppliers.

Q: What role does Big Data play in increasing the efficiency of the logistics chain?

A: Goods, information and monetary resources are the three elements flowing across the supply chain and we need tools that ensure visibility and connectivity to keep track of them. This includes everything from ERP and Customer Relationship Management (CRM) software to Warehouse and Transport Management Systems (WMS and TMS). We also need strategic tools that help companies design their supply chains and transform data into useful information. Technologies like IoT come in handy for the latter. All internal and external data from a company needs to work together efficiently and Big Data analytics, together with artificial intelligence, enable organizations to process information to ensure the needed visibility and make agile and efficient decisions.

The first step toward adopting these technologies is to have reliable data mining based on strong data governance. This means being able to identify the source that generated every piece of data and the owner of that source. It is also important that data is generated by technologies like master data management systems that do not depend on humans logging data. This ensures greater information consistency and a lower margin of error. Next, it is key to offer visibility to understand what happened in the logistics process and why it happened. Many companies that are adopting Industry 4.0 practices are already working on this step.

Adopting predictive models based on external data that can affect the process comes next. This leads to a stage of adaptation and learning where companies have already earned solid experience and can formulate scenarios to anticipate changes in the market to generate innovation and evolve their business. This optimizes processes and ensures the elimination of operational barriers.