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The impact of industry 4.0 on the transport & logistics sector

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Dennis Adonis


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4 Oct 2018
4 min read
A warehouse with automated machines doing work

The state of business communication amidst Industry 4.0

As is the case for most industries, transport sector businesses are facing sustained and profound change, driven by software disruption and the impacts of new technologies on supply chains globally. This has created a rapid shift in processes to accommodate the fundamentals of Industry 4.0 - aka the digital transformation of traditional industries into the modern age.

Although referring to this trend towards automation and the digitization of manufacturing, the practical applications of these technologies are being significantly realized across the transport and logistics sector. This is driving the use of communication tools for digitization and integration of vertical and horizontal value chains, digitization of product and service offerings, and the development of new digital business models and customer access platforms.

Industry 4.0 basics

Four central design principles support all Industry 4.0 system conceptualization:

  • Interoperability: the ability of machines, devices, sensors, and people to connect and communicate with each other via the Internet of Things (IoT).

  • Information transparency: contextualized information created via a virtual copy of the physical world through sensor data.

  • Technical assistance: in thought and action. Firstly, the analytical support by the system for humans in making decisions and solving problems; secondly, the ability to assist humans with tasks that are too challenging or physically dangerous for humans.

  • Decentralized decision-making: the ability of cyber-physical systems to make simple decisions on their own and become as autonomous as possible.

What's driving these developments?

The volume of data is rising dramatically, along with computational power and connectivity. This has led to the creation of analytics and business-intelligence capabilities that are required in organizations also acting as supply chains.

As a result, new forms of human-machine interaction have emerged, such as touch interfaces and augmented-reality systems - bringing a whole new definition to the term "effective communication." This also has created swift improvements in transferring digital instructions to the physical world when it comes to customer and team member communications, such as using robotics and 3D printing.

How is this impacting the sector?

Industry 4.0 has finally started to emerge as a real driving force shaping the future of the global supply chain. It's a blend of technologies including advanced robotics and artificial intelligence; sophisticated sensors; big data analytics; 3D printing; cloud-enabled business models; high-powered mobile devices; and algorithms to direct motor vehicles. Many advancements to these communication tools include real-time navigation, ride-sharing apps, autonomous vehicles, and last-mile delivery services), enabling advanced interchangeability across companies, countries, collaborators, and competitors.

With more than $4.6 trillion of annual revenues at stake, the rewards are evident for small businesses and large organizations that are able to adopt powerful tools, a clearer vision, specific tactics, and strategic partnerships to ensure their digital fitness.

Digital transformation – engaging the value of the Industrial Internet of Things

The Physical Internet (PI or π) is allowing manufacturers to redefine how they interact with customers, and how they structure their supply chains - which need to become far more social and data acquisitive for traceability and predictability.

These emerging concepts are being applied to real-world shipping processes, with smart, eco-friendly, and modular containers ranging from the size of a maritime container to the size of a small box becoming standardized across all businesses and countries. These modular containers are continuously monitored and routed, sharing digital connectivity through the Internet of Things.

For the Physical Internet to work in practice, a far greater level of collaboration is needed across the sector - combining physical technologies with digital communication tools to create long-term solutions. Most of the 535,000 distribution centers in the US, for example, are standalone operations owned by different companies. Improved connectivity via communication tools and standardization of physical workflows could create significant efficiencies. The potential is vast - estimates in the EU logistics sector have shown that a 10% to 30% increase in efficiency would translate into €100-300 billion in cost savings for the European industry. (2)

Looking ahead

Technology is redefining every element of global supply operations, from manufacturing to shipping, warehousing, competition, collaboration, and customer expectation management. With so many digital tools and technologies competing for management attention and investment, defining a clear digital strategy to help drive business efficiencies is crucial for future competitive survival.

What to do?

One of the first steps to meeting the needs of Industry 4.0 is looking into the different ways that communication can make a positive impact on your organization and its supply chain.

Collaboration tools

  • There are a variety of different tools available that enable large teams to streamline organization-wide efforts. Many offer capabilities such as instant messaging, video conferencing, social media integration, and more.

Communication software

  • An omnichannel communications platform is ideal for distributing the right messages at the right times to the right people.

  • As is the case with all supply chain operations, remote workers are essential to company success and must be kept in the loop as much as internal team members. 

SMS text messaging

  • Directly contacting your target audience (field workers, management, stakeholders, IT, etc.) via their mobile phones is a surefire path to better communication.

  • 2-way conversations allow for critical information to be sent and received in real-time, increasing work safety.

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