Logistics 4.0: trends, technologies, and a concrete experiment with OLOGER
In the context of the fourth industrial revolution and the digital transformation of enterprises, anlisying logistic chains, their evolution and digitization, the so-called Logistics 4.0, has become of primary interest to companies.
At European level, as indicated in a European Commission document, the logistics sector accounts for 14% of the EU GDP and is expected to grow up to 40% by 2040 .
The complexity of logistic chains dealing with the distribution of goods, from raw materials to finished products, is determined by the high fragmentation into hundreds of stages. Such process involves different and heterogeneous actors geographically distributed across the world. This fragmented framework clearly makes it difficult both to trace events, investigate accidents and to take targeted actions in response. Moreover, the inhomogeneous digitalization level of the different stakeholders and of the documentation associated with logistic processes often represents a bottleneck and create costs. Another relevant point of complexity is represented by the security, the standardization, and the interoperability of logistic data sources.
New intelligent technologies have being introduced in factories to create interoperable and connected manufacturing workflows, as well as the modern logistics chain is rapidly becoming “smarter”, thanks to the introduction of similar technologies.
The challenge is to innovate logistics chains to make information and their flow efficient and verifiable all along the way, guaranteeing transparency, security, and accountability, so that users have accessible, accurate, and reliable information.
Logistics 4.0 has the objective of creating a transparent ecosystem, in which all the systems involved can expose relevant data. People, machines, sensors, and devices will be able to share the data necessary for the supply chain to operate efficiently, which will enable end-to-end visibility and control. This will also support top management decisions by providing in advance insights and prediction about delays, breakdowns, and interruptions to the stakeholders involved in the supply chain.
The enabling technologies for the digital transformation of logistics are already available (ie., IoT, AI, Advanced Analytics, and Blockchain). Many companies are acting to adopt them to innovate their business intelligence, transports, and warehouses.
Internet of Things
“Smart” shipments and transports, such as smart pallets and containers, will be able to transmit all the relevant shipment data, and, through this data, it will be possible to obtain end-to-end visibility of the occurrence of events such as slowdowns, failures, and interruptions. This will allow to minimize the impact on processes.
The goal of the AI in the supply chain is to introduce automation in data processing/analysis and to emulate human decisions in processes such as demand forecasting, production planning or predictive maintenance. The AI starts from the analysis of large amounts of data related to logistic processes, and supports the analysis of these processes by finding anomalies, making forecasts with respect to events that may occur, and then providing recommendations to find potential resolutions.
Advanced analytics techniques will enable more and more proactive supply chains. Using data coming from the IoT world and integrating it with other data sources (i.e., enterprise and open data like weather data) will allow a better understanding of future scenarios while also producing insights and useful recommendations for companies to improve end-to-end efficiency.
This technology is generating great interest for supply chain actors. The advantage of using Blockchain derives from the fact of being able to create a decentralized ecosystem guaranteeing automation, traceability, and security. On the other hand, the lack of standards for governance and scalable distributed consensum systems are the challenges that slow down the adoption and success of PoCs and pilots leveraging this technology.
Logistics 4.0 has the potential to pave the way to the creation of an advanced and safe ecosystem that will link all the players in the supply chain, where value will be given by the data flow that involves logistics operations, and will open the doors to collaboration and experimentation between companies to create new services and innovative solutions.
IoT technology acts as an enabler of supply chain digitization, but the actual business value of the solution is linked to the creation of value-added services based on advanced analytics and Artificial Intelligence techniques, which will make it possible to predicti critical situations and preventing them from happening, to increase efficiency and the overall quality of the process.
As already underlined, the information relating to shipping data is of interest to all stakeholders in the supply chain. This possibility must be seen both from the standpoint of improving performance and reducing costs, and from the standpoint of new revenue channels. Let’s consider, for example, a shipping service “in guaranteed conditions” provided by a logistics operator. In this case, solutions such as the one illustrated above may constitute an enabling and differentiating technological factor in the overall scenario.
On the field…
Within the European project H2020 MIDIH (Manufacturing Industry Digital Innovation Hubs) and in collaboration with the Centro Ricerche Fiat, FCA Group, Cefriel is testing a Smart Logistics solution based on an IoT device for industrial logistics called OLOGER (Outdoor LOGistic trackER) and on a web application for the devices fleet management and the data visualization and processing. OLOGER allows to track the position of the goods to which it is applied and to detect events such as the variation of the storage temperature, humidity, possible shocks, and vibrations suffered by the goods. The data is then transmitted through the cellular network (worldwide operational coverage) to be analyzed through the application of Smart Logistics, developed within the project, which provides information on the status of shipments to all the stakeholders involved.
The manufacturer can therefore estimate risks related to the shipping and can alert those who are handling the transport preventing the goods from being damaged.
A typical use case is, for example, the transport of monitors or electronic equipment. Knowing a variation in the inclination of the package containing them could allow the senders to ask not only for integrity verification but also for any intervention aimed at restoring ideal transport conditions.
Another logistics sector that could leverage such a system is the one of medicines shipments. It is crucial to know wether the product is undamaged and can be taken by a patient. And its integrity is defined by the conditions of travel, for example by the temperature that one has been able to maintain. It becomes of vital importance to be able not only to reschedule a new shipment in a very short time, but also to alert the customer on the possible non-integrity of the product.
OLOGER and the smart logistics solution have being tested on the field with CRF, to track the quality and position of car parts and sub-assemblies’ shipments between the various plants on the Italian territory. The events (temperature variation, humidity variation, shocks…) to be detected can be diversified according to the product characteristics. Moreover, using an IoT mobile network for data transmission, this device can be used practically anywhere in the world.
The European project MIDIH acted as a catalyst by providing a series of tools at the digital platform level for the collection, management, and processing of data, used by Cefriel for the development of the application, and by directly connecting Cefriel and CRF (early adopter of the solution and Lighthouse Experimenter within the project).
This article is a summary and translation of the original articles published by TechEconomy in collaboration with Cefriel:
L’evoluzione della supply chain