Volume 3 Issue 5 May 2021
In this Issue
Welcome to Industree 4.0 for May 2021, exclusively sponsored by SAP. Sustainable might be the word for the month. Sustainable supply chains and sustainable streams of skilled and motivated personnel.
By Richard Howells

Supply Chain Solutions Management, SAP
The Sustainable Supply Chain Paradox: Balancing The Bottom Line And The Green Line
Sustainability should be front and center in supply chain initiatives. While sustainability is top of mind in most companies’ mission or purpose statement, few have the visibility and processes in place across the supply chain to achieve these goals today. These are key takeaways gleaned from a recent Oxford Economics study, “The Sustainable Supply Chain Paradox: Balancing the bottom line with the green line.

Sustainability will be front and center post pandemic

Sustainability was a major focus pre pandemic, and it is clear from the study that it will be so again post pandemic. In fact, the 2020s have been named the Decade of Action by the United Nations, which calls for “accelerating sustainable solutions to all the world’s biggest challenges – ranging from poverty and gender to climate change, inequality and closing the finance gap” by 2030.

Climate change, circular economy and sustainability have all come to the forefront over the past few years and our global supply chains sit right in the middle of these challenges, both as a major contributor to the problems, and as a great area of focus where we can take action to address the problems.

The need is clear, but the path to get there is not

If you look at most Corporate website for a company’s values, purpose, or mission, sustainability is often at the top of the list. The survey confirms this, stating that 65% of companies have created a clear purpose statement around sustainability, with a further 23% said they are in the process of doing so. That’s 88% in total.

However, there’s a long way to go in living up to that “purpose.” For example, only half have reduced overall shipping miles. And while over two-thirds say they would reduce the amount of business they do with a supplier shown to have unsustainable practices, only a small percentage have the visibility into their multi-tier suppliers’ processes that would enable them to make that decision.

What is driving Sustainability?

Most respondents agree that having a clear purpose and mission is necessary to the long-term success of their businesses, that a sustainable supply chain is a competitive differentiator, and that good sustainability practices reduce risk.

The survey also highlighted the top three 3 market factors influencing sustainability initiatives as, product and service innovation, customers demand, and increasing industry and governmental regulations.

Sustainability – From design to decommission

Supply Chain sustainability is the management of environmental, social and economic impacts, and the encouragement of good governance practices throughout the lifecycles of goods and services. End-to-end supply chain transparency is critical, whether unhoused across your own facilities or outsourced to trading partners. Sustainability initiatives must extend from the design to the decommission of a product: from raw materials sourcing, to last-mile logistics, and even to product usage, returns and recycling processes. 

Sustainable Design for a sustainable product lifecycle

Companies need to think “sustainable” from the start of a products life, by designing products and packaging that are biodegradable, and environmentally sustainable. In the design process you need to be able to: 

  1. Calculate the environmental costs for products throughout the lifecycle
  2. Simulate the manufacturing impact on the environment
  3. Link the Voice of Customer feedback to sustainable requirements

Sustainable Plans for a sustainable outcome

The saying goes, “if you fail to plan, you plan to fail.” And this is true of a sustainability initiative. Businesses need to:

  1. Drive Planning processes that strive to reduce emissions, and ethically satisfy demand with sustainable, ethically sourced supply.
  2. Increase forecast and accuracy to reduce obsolete inventory
  3. Predict end-of-life scenarios and support circular processes
  4. Simulate CO2 footprint of the plan through procurement, production and transport, and production
  5. And report actual results to compare to the plan to identify successes and areas for improvement

Sustainable Manufacturing to minimize waste and environment impact
Manufacturing facilities are a huge area of opportunity to drive carbon reductions and sustainability initiatives. But this involves:
  1. Monitoring energy usage as a function of production volume
  2. Measuring CO2 emissions against compliance commitments
  3. Capturing and utilizing Co- and By-Products to minimize waste
  4. Enforce Safety management for sustainable workforce

Sustainable Logistics that reduce mileage, emissions, and carbon footprint

The logistics process that move goods around the globe are also a huge area of focus when it comes to sustainability.

  1. Track, measure and optimize CO2- and energy consumption in warehousing and transportation functions
  2. Consider delivery resources that are energy efficient or CO2 neutral (especially for inner city or last-mile delivery tasks)
  3. Optimized routing to run the shortest and least congested route to conserve energy, and reduce miles and carbon footprint
  4. Leverage Optimized 3D truck load planning to reduce empty miles traveled

Operate assets and equipment in an energy-efficient manner

Sustainability through the full product or asset lifecycle is critical. By having visibility into how they are performing at a customer's site or home can enable you to:

  1. Extending asset life and reduce energy consumption
  2. Calculate and track the environmental impact of asset operations
  3. Ensure the safety of operators or users and ensure environmental and safety compliance

Embrace your network of partners is a key part of a sustainability initiative

At the end of the day, no business operates alone, and leverages a network of contract manufacturers, suppliers, 3PL’s and other trading partners.

  1. Ensure visibility across all tiers of the network is critical. If a supplier 2 tiers down your supply chain has unethical practices, it could be your brand that suffers.
  2. Monitor and track compliance agreements to reduce risks

The survey concludes by stating that “executives must realize that sustainability can no longer be treated as an afterthought. It is an integral part of the day-to-day activities that keep a supply chain running, from design through to decommissioning,” and provides some sound advice and recommendations for all areas across the supply chain and product lifecycle.

A trillion dollar labor problem
By Pat Dixon, PE, PMP

President of 

Matt Egan of CNN published an article on May 5 entitled “American factories are desperate for workers. It's a $1 trillion problem”. It is worth a read.

It might seem counterintuitive that after so many have suffered economically and industry is ramping up after a pandemic, that industry would have a problem offering opportunity well above minimum wage. Also counterintuitive is the reasoning; the article states “Manufacturing executives say part of the problem is that many young Americans just don't want to work in factories, in part because of fears about robots taking over and jobs getting shipped overseas.”

This seems to be a self-fulfilling prophecy. Demand for robots and other automation will grow if it is the only available alternative for manufacturing domestically. The non-domestic alternative will be a less desirable recourse.  

As advanced as industry has become in automation, we still need people to make things. A lot of people.  

There may come a time when automation advances to the stage that physical labor in manufacturing is nearly extinct. However, I have often said that if you want the most creative machine, have a baby. Solving problems in industry often requires creativity that artificial intelligence may approximate but will likely never eclipse humans.

Ray Kurzweil may disagree, but nearly anyone in technology agrees we are a long way away from downsizing labor with artificial intelligence. Investments in labor go along with investments in automation to ramp up production as demand recovers. If only we could find workers!

To attract and train
﻿Above, Pat Dixon is talking about the general labor problem in industry today. I would like to reinforce that and add to it a bit.

You have likely heard that agriculture, farming in particular, in the USA has gone from employing 98% of the workforce in the 1800's to 2% today. In other words, it has completely flipped. This is attributed to improvements in mechanization, fertilization and genetics. In the last 30 years, one can add computerization as well when looking at the drastic improvements in efficiency in farming.

However, this neglects looking at the raw numbers. In "Labor Force and Employment, 1800 -1960" by Stanley Lebergott of Wesleyan University, somewhat different numbers are reported. Lebergott places the percentage of labor employed in farming as 73.7% in 1800 and 8.1% in 1960. But here is the kicker: in raw numbers of people employed in farming, in 1800 there were 1,400,000 and in 1960 there were 5,970,000. To be accurate, I should mention that Lebergott reported much higher numbers in the time period 1910 - 1940 (when horses were still the primary motive power on the farm).

But the point is this, over a very long period of time, while the percentage of people involved in the activity of agriculture has gone down, the number of people involved has gone up by more than four times.

The same is true in the broad area of manufacturing as a whole. After all, there were no people engaged in manufacturing refrigerators or automobiles in 1800. I am certain of that.

Likewise, I am pretty sure the numbers involved in manufacturing windmills and solar cells in 1970 were very low, too.

The point is, we don't know what the demand for any particular manufactured good will be tomorrow, especially the ones that have not been invented yet. What we do know is we will need a skilled and diverse workforce to manufacture those and existing products. That workforce will be supplemented by robots, Industry 4.0 and other technologies not yet invented. The challenge is to attract that workforce to manufacturing and train them to fully engage with the latest intellectual tools we create.
Industry 4.0: Crafting the Future With AI, Robotics, and Automation
By Ryan E. Day
Just like its predecessors, this fourth industrial revolution (Industry 4.0) is all about increasing productivity. Unlike the first three revolutions, today’s pivotal technologies hold forth the possibility to also improve efficiency, quality, and human satisfaction.
Why IIoT Demand Continues to Grow
By Luigi De Bernardini
The pandemic deeply affected all manufacturing industries and supply chains, forcing them to quickly rethink their investment strategy. Things happened in a nonlinear progression, with several changes of directions, while companies began to understand how the virus was changing their business and modifying their usual market. Looking back, I can find four main phases: reaction, waiting, planning, and implementing.
Fast track degree program accelerating engineers towards Industry 4.0
Plant Works & Engineering
Since its launch in 2017, the degree program has gone from strength to strength and by the end of the year will have upskilled 79 young and experienced engineers making them industry ready and fully equipped to deal with future technologies.
Common application layer protocols in IoT explained
By Scott Robinson
The global growth in IoT-based applications makes the cloud look tame, as far as technological innovations and social importance go. IoT has given the world automated industrial operations, personal healthcare monitoring, traffic control and smart homes. The list is very long and growing.
Industree 4.0 is exclusively sponsored by SAP