Special Focus Supply Chain 40 | Plant & Works Engineering www.pwemag.co.uk October/November 2024 Tom Cash, director of automation parts supplier Foxmere, explains how Supply Chain 4.0 technologies will help manufacturers prevent unplanned downtime. McKinsey & Company’s Supply Chain Pulse Survey demonstrates a rapid digital planning revolution, with companies accelerating the adoption of advanced tools since the COVID-19 pandemic. With 79% of respondents having achieved end-to-end visibility, many are now focusing efforts on overhauling outdated planning processes to unlock their full potential. Supply Chain 4.0 refers to the modern evolution of supply chains driven by Industry 4.0 technologies, such as automation, data analytics, AI and the Internet of Things (IoT). This modern approach is more data-driven and strategically managed thanks to the aforementioned Industry 4.0 technologies that enable real time visibility and advanced analytics, offering many benefits to businesses within the supply chain. Just look at the Deep transformation with smart supply chain digitisation report by Accenture, which highlights a global retailer that increased its profits by 28 per cent and doubled its operating profit in just three years by digitising its supply chain process. Brief history The evolution of logistics has been quite remarkable during the past 30 years. Processes have changed from traditional, manual methods focused mainly on optimising supply lines to a much more dynamic and data-driven approach to supply chain management. Initially, logistics was focused on efficiently transporting goods from point A to point B. Today’s supply chain management encompasses a broader range of activities, including procurement, manufacturing, distribution and even returns, connecting customers to suppliers in a seamless flow of information and goods. In fact, Chief Supply Chain Officer (CSCO) is a role that has emerged because of this, having not existed 30 years ago. The CSCO oversees the entire supply chain and ensures that all aspects — from demand planning to delivery — are strategically aligned with the company’s goals. Unplanned downtime Such role reflects the importance of supply chain functions in today's business landscape, where disruptions can have significant impacts on business operations. A common disruption manufacturers face is unplanned downtime, which refers to unexpected halts in production, usually caused by equipment failure, the absence of a preventive maintenance strategy, supply chain disruption or general poor planning. Concerningly, the average manufacturer confronts 800 hours of equipment downtime per year — more than 15 hours per week — and that downtime comes at a cost. Unplanned downtime costs industrial manufacturers as much as $50 billion a year (£39 billion), with the average automotive manufacturer losing $22,000 (£17,000) per minute when the production line stops. Planning visibility Thankfully, the integration of Supply Chain 4.0 technologies is changing how manufacturers address this issue. According to McKinsey, 65% of companies are regularly using GenAI, nearly double the number compared to just ten months prior. This Harnessing Supply Chain 4.0 to minimise unplanned downtime
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