The Fourth Industrial Revolution

The First Industrial Revolution started in Britain and used steam power to industrialize production. It can be seen in the images of Britain in the 1800s covered in soot. The Second Industrial Revolution started in the United States when Henry Ford mastered the assembly line and introduced it to the world. The first two industrial revolutions made people richer and more urban. The Third started in the late 1960s and it used electronics and information technology to give rise to high-level automation in production. Now a Fourth Industrial Revolution is building on the Third, the digital revolution that began since the middle of the last century.

Today’s and tomorrow’s industries aim to connect all means of production to enable interaction in real time. Industry 4.0 makes communication among the different players and connected objects in a production line possible using technologies such as Cloud, Big Data, Internet of Things, etc. The applications for the industrial sector are enormous, predictive maintenance, real-time decision-making, minimizing inventory loss, improved coordination in jobs, etc. Every day, all these improvements are gradually optimizing production tools and revealing endless possibilities for the future of the industry.

The Fourth Industrial Revolution could be the first to deviate from the non-renewable energy sources because we have been integrating more ways to power our production processes with alternative energy sources. Tomorrow’s industries will be rooted in smart cities and powered by wind, sun and other forms of renewable energy.

Just like the previous revolutions, the Fourth Industrial Revolution has the potential to raise income levels and improve the quality of life globally. Until today, those consumers who are able to afford and access the digital world; technology has made possible new products and services that increase efficiency. Ordering cabs, booking flights, buying products, making payments, listening to music, watching movies, and many more can now be done remotely.

In a pessimistic view, the Fourth Industrial Revolution can robotize humanity, but it can also lift humanity into a new collective and moral consciousness. The onus is on us to make sure the latter prevails.

Fourth Industrial Revolution

Sources: https://www.rasmussen.edu/degrees/technology/blog/fourth-industrial-revolution/
https://www.ariasystems.com/blog/fourth-industrial-revolution-upon-us/

Child Labor in Supply Chains

Ten percent of the world’s children, 152 Million, are used as laborers.  While the global supply chain has lowered costs and increased efficiencies, it has also helped mask child labor violations in several industries. Businesses have a responsibility to build ethical supply chains that respect human rights

Child Labor

“These practices create not only human rights abuses, but they create an uneven playing field, making it hard for businesses that play by the rules to compete. A country’s failure to stop the exploitation of its labor force undermines the well-being of American workers and other workers around the world,” U.S. Secretary of Labor Alex Acosta writes in his foreword to the report.

Globally, the International Labor Organization’s minimum age convention sets 15 years of age as the minimum threshold for regular employment. An important step in fighting child labor is identifying its role in the supply chains. The chain often ends with unaware consumers buying goods that are produced by children.

Experts at the ILO have identified multiple factors that cause the use of child labor. Families under severe financial stress. They need to have the extra income gained from sending a child to work. Governments have a weak enforcement of child labor laws and don’t prosecute labor violations. Children end up working instead of pursuing an education.  According to the United States Department of Labor, children contribute to the production of 139 goods from 75 countries. The Labor Department has identified industries where child labor is most common, including, Agriculture: Growing cotton, sugarcane, coffee, and tobacco, Manufacturing: Making bricks, garments, and textiles, Mining/quarrying: Extracting gold, coal, and diamonds.

Companies that use child labor go to great lengths to cover it up. Many businesses hire compliance auditors to visit farms and factories to ensure suppliers are following the law. However, auditors can only review the worksites they’re aware of. It’s quite common for child labor operations to work as subcontractors to stay hidden from authorities or customers. While auditors visit worksites to confirm compliance, the addition of an analytics program designed to identify trends and correlations that may not be apparent to a human being are a crucial supplemental strategy. Advanced algorithms sort through information on violations by region or product, bringing potential risks to the attention of compliance professionals. Keeping child labor out of your supply chain hurts criminals where it counts i.e. their profits. Removing the financial incentive to employ cheap child labor can go a long way towards eliminating modern slavery and the exploitation of children.

Sources: https://share.america.gov/gettting-child-labor-out-of-global-supply-chain/

Japanese start-up introduces the first humanless warehouse

Jobs performed by warehouse workers and forklift operators are now completed by robots in the first humanless warehouse in Tokyo. Mujin, a start-up company, has equipped its customer’s, JD.com, e-commerce warehouse with robots.

In an effort to augment existing industrial robot arms, Mujin is building robot controllers and camera systems. The controller’s technology based on motion planning and computer vision, strengthens robotic autonomous and intelligent action. The enhanced controllers lead to the elimination of manual robot training and overall higher productivity.

The 40,000-sq-m JD.com e-commerce facility is equipped with 20 industrial robots that complete tasks such as picking, transferring packages, and loading docks and trucks. Crates on conveyor belts, camera systems and Mujin robot controllers are all part of the humanless warehouse. The robots come with five workers who are needed to service the machines, compared to an estimated 400 to 500 workers that would be needed in the absence of the robots.

Mujin is targeting the predictability in the controller’s moves, and the development of automation technologies such as robot hardware, sensing hardware, AI algorithms, conveyor systems and sorting systems. That’s to say that the company aims to standardize a complete automation package that can automate warehouses without tailored components for customers.

Improvements will continue to be made in the field of warehouse automation as Japanese companies, following JD.com, will be testing out the new technology.

What level of engagement do workers have in a fully automated warehouse?

How are robots enhancing productivity in a warehouse?

What technologies can aid the integration of robots in a warehouse?

Source:

https://www.cnbc.com/2018/10/30/the-worlds-first-humanless-warehouse-is-run-only-by-robots.html

Introducing Advanced Connectivity with Wi-Fi on the go

Imagine a fully functioning and connected office on the go. Access to multiple entertainment and business applications from within your vehicle is now available as the British car manufacturer, Bentley, announced the offering of the first in-car Wi-Fi system.

All Bentley models in 2019 will be presenting drivers and passengers the ability to connect to the Bentley Advanced Connectivity system using a dedicated app on their smart phone. User friendly applications include the ability to access and edit files, hold video conferences, connect to virtual meetings, and benefit from Bentley Skype for Business.

Behind Bentley Advanced Connectivity

An exclusive contract has given Bentley a head-start in Wi-Fi on the go for at least 12 months. Partnering with internationally recognized communication company, Viasat, the manufacturer produced a multi-channel virtual private network (VPN) capable of supporting up to three mobile network operators. Style and comfort are not compromised with the connectivity system placed inside the vehicle’s boot lid, and the router connected to the on-board DC power supply.

Bentley IoT Security

Multiple layers of security and in place as data transferred with Bentley Advanced Connected is reconsolidated for the end user after being divided and transmitted over three mobile networks. One compromised SIM card would therefore not alarm a security breach as it represents only part of the data package. Furthermore, Active Cyber Defense, a system developed to protect users from data theft and ransomware attacks offers additional layers of support and security. On-the go secure connectivity is being made possible through technology and comfort.

What does the future of driving with Wi-Fi look like?

How does IoT enhance one’s driving experience?

Is data security compromised with on-the-go Wi-Fi?

Sources:

https://www.bentleymotors.com/en/world-of-bentley/the-bentley-story/news/2018-news/bentley-introduces-worlds-first-super-fast-in-car-wifi.html

https://www.iottechnews.com/news/2018/nov/05/bentley-launches-car-wi-fi-system-advanced-connectivity-uninterrupted-mobile-network/

 

 

Updating Manufacturing Security to Address New Threats

In today’s society where the use of new technology and the internet are advancing at ever increasing rates manufacturing operations are opening themselves up to a new type of threat to their operations – cyberattacks. This doesn’t just apply to the large manufacturing operations, but any manufacturer that manages lucrative assets and information. As Mark Sangster mentions in his article “Manufacturing Cybersecurity Must Adapt to Emerging Technology and Threats”, “Growth and economic strength of a nation is measured by its manufacturing” which means that any manufacturing operation is the prime target of espionage as groups try to steal vital manufacturing IPs and operational secrets to improve their own operations or sell to others for a profit. Breaches are occurring regularly and, as some major corporations such Foxxconn, Honda, and Boeing can attest, can be very costly. Each of these companies have been breached and ended up paying between $3.5 and $6.0 million to fix.

 

In his article, Sangster mentions ten things that manufacturers can do to mitigate the risks and fallout from cyberattacks on their operations. These are as follows:

  1. Identify and audit critical systems and data – determine what is most critical to your operation and would have the greatest impact if it were attacked so that you are focusing your efforts on protecting what is most important
  2. Understand your obligations – this means more than just legally but also in terms of regulations, client accountability, internal supply chain responsibilities, etc.
  3. Establish cybersecurity policies and procedures – the easiest way to fall victim to cyberattacks is not to have security procedures in place or a procedure for reporting and dealing with an attack when it happens
  4. Conduct an annual risk assessment and security readiness exam – continually assess and update your security to ensure that you are always protected to the best of your ability
  5. Require encryption of stored data – this includes data on all platforms including mobile devices, laptops, servers, cloud storage, etc.
  6. Use VPN security to protect data and user credentials in motion through a virtual private network
  7. Establish mobile and bring your own device (BYOD) policies and controls to enforce strong password and limit access to critical corporate assets such as the ones identified in number one
  8. Establish back-up systems and services to help you recover in the event that a cyberattack does occur
  9. Establish an incident response plan and team – more importantly run practice drills, like you do for fire drills, to ensure that everyone is aware of the procedure and aware of what to do in case of an attack
  10. Consider getting cyber insurance – this will help cover the cost of an attack from investigation and disruption to lost revenue and other costs not covered in non-cyber specific policies

 

Follow-Up Questions:

  1. What are my options legally in terms of recovering losses due to attacks? What agencies can I go to for help if I am attacked?
  2. Is it worth investing in outsourced cyber security to prevent an attack from occurring?
  3. As technology continues to advance, what additional risks do we need to consider when it comes to protecting our manufacturing operations?

Source: https://www.manufacturing.net/article/2018/11/manufacturing-cybersecurity-must-adapt-emerging-technology-and-threats

Artificial Intelligence in Supply Chain

 

The potential of AI enhancing everyday business activities and strategies hasn’t just sparked the interest of people and organisations globally, but has initiated rapid implementation.

AI was broken down into two categories:

  • “Augmentation: AI, which assists humans with their day-to-day tasks, personally or commercially without having complete control of the output. Such Artificial Intelligence is used in Virtual Assistant, Data analysis, software solutions; where they are mainly used to reduce errors due to human bias.
  • Automation: AI, which works completely autonomously in any field without the need for any human intervention. For example, robots performing key process steps in manufacturing plants” (com 2017).

Enhancing Productivity and Profits.

Understanding these two categories of AI capacities is important for future implementation of AI into business work tools. In particular, the application of AI into Supply Chain related-tasks holds high potential for boosting top-line and bottom-line value.

The graphic below shows a breakdown of the applications of AI in 835 different companies in the past year.

 How can AI be applied within SCM activities?

  1. Chatbots for Operational Procurement:

 Streamlining procurement related tasks through the automation and augmentation of Chabot capability requires access to robust and intelligent data sets, in which, the ‘procuebot’ would be able to access as a frame of reference; or it’s ‘brains’

As for daily tasks, Chatbots could be utilised to:

  • Speak to suppliers during trivial conversations.
  • Set and send actions to suppliers regarding governance and compliance materials.
  • Place purchasing requests.
  • Research and answer internal questions regarding procurement functionalities or a supplier/supplier set.
  • Receiving/filing/documentation of invoices and payments/order requests (Smith 2016).
  1. Machine Learning (ML) for Supply Chain Planning (SCP)

Supply chain planning is a crucial activity within SCM strategy. Having intelligent work tools for building concrete plans is a must in today’s business world.

ML, applied within SCP could help with forecasting within inventory, demand and supply. If applied correctly through SCM work tools, ML could revolutionise the agility and optimisation of supply chain decision-making.

By utilising ML technology, SCM professionals — responsible for SCP — would be giving best possible scenarios based upon intelligent algorithms and machine-to-machine analysis of big data sets. This kind of capability could optimise the delivery of goods while balancing supply and demand, and wouldn’t require human analysis, but rather action setting for parameters of success.

  1. Machine Learning for Warehouse Management

Taking a closer look at the domain of SCP, its success is heavily reliant on proper warehouse and inventory-based management. Regardless of demand forecasting, supply flaws (overstocking or under stocking) can be a disaster for just about any consumer-based company/retailer.

“A forecasting engine with machine learning, just keeps looking to see which combinations of algorithms and data streams have the most predictive power for the different forecasting hierarchies” (forbes.com 2017).

ML provides an endless loop of forecasting, which bears a constantly self-improving output. This kind of capabilities could reshape warehouse management as we know today.

  1. Autonomous Vehicles for Logistics and Shipping

Intelligence in logistics and shipping has become a center-stage kind of focus within supply chain management in the recent years. Faster and more accurate shipping reduces lead times and transportation expenses, adds elements of environmental friendly operations, reduces labor costs, and — most important of all — widens the gap between competitors.

If autonomous vehicles were developed to the potential — that certain business analysts and tech gurus have hypothesised — the impact on logistics optimisation would be astronomical.

“Where drivers are restricted by law from driving more than 11 hours per day without taking an 8-hour break, a driverless truck can drive nearly 24 hours per day. That means the technology would effectively double the output of the U.S. transportation network at 25 percent of the cost” (techcrunch.com 2016).

  1. Natural Language Processing (NLP) for Data Cleansing and Building Data Robustness

NLP is an element of AI and Machine Learning, which has staggering potential for deciphering large amounts of foreign language data in a streamlined manner.

NLP, applied through the correct work took, could build data sets regarding suppliers, and decipher untapped information, due to language barrier. From a CSR or Sustainability & Governance perspective, NLP technology could streamline auditing and compliance actions previously unable because of existing language barriers between buyer-supplier bodies (greenbiz 2017).

 

https://medium.com/@KodiakRating/6-applications-of-artificial-intelligence-for-your-supply-chain-b82e1e7400c8

 

  1. Q) Potential of AI in supply chain
  2. Q) Supply Chain Challenges implementing AI
  3. Q) Potential Threats

Power Of Block Chain Enable Supply Chain

Through blockchains, companies gain a real-time digital ledger of transactions and movements for all participants in their supply chain network. But don’t let the simplicity of the tool overshadow how transformational it is. The benefits to be gained will save you time, money, and effort on several fronts — and have the potential to redefine how you do business. Procurement: more visibility and more savings Companies negotiate procurement discounts based on the total number of purchases they drive. Your business may ask other people to do purchasing on your behalf, but the consequence is that it’s hard to keep track of the volume you drive across subsidiaries, business partners, and everyone else in your supply chain network. Blockchains make that simple. With a constantly refreshed digital ledger that incorporates data from all your relevant partners, your company can see the total volume regardless of who directed the purchase activity — without each user having to share its operational data with the others. Without a blockchain, companies hire many people to audit their orders to capture these volume-purchase benefits. Large businesses can have dozens of professionals spending days and nights to audit each one to add up all the gains they’re supposed to receive. But blockchains do this work without the staff and without any added time, eliminating the extra price-verification process. Data and analytics: better data, better outcomes The oldest phrase in computing is “garbage in, garbage out” — and nowhere does that apply more strongly and more expensively than in supply chain management. To compensate for uncertainty in how much product or material is in different locations — how much actual demand there has been in a period of time — companies put in extra inventory. And while that inventory is often cheaper than a lost sale, it’s far from free. In the technology industry, it is often estimated that keeping $1 of inventory costs 20 cents to 40 cents per year, when you account for both the cost of capital and the rapid depreciation of technology products.

 

Smart contracts to end costly procure-to-pay gaps The result is a ridiculous and insanely expensive dance as suppliers politely call and nudge customers to pay, while customers aim to cash in on the float by entering and processing invoices at a snail’s pace and occasionally “losing” them. Blockchains can put an end to that by integrating delivery and payment in digital contracts that flow across enterprises and integrate with logistics partners and banks. Using smart contracts, where the terms are payable upon receipt, a proof of delivery from a logistics carrier will immediately trigger automatic digital invoicing and payments through the banking system, with no analog gap between customer and supplier. The result has the potential to radically reduce working capital requirements and dramatically simplify finance operations, with a direct impact to the bottom line. Putting a stop to the rogues Blockchains give these supply chain networks the chance to create one shared truth without one all-powerful, centralised intermediary. Each participant has a copy of the ledger, and all transactions and movements are part of that ledger. If any participant tries to game the system or perpetrate fraud, that company is manipulating only its ledger and is immediately out of sync with the rest of the ecosystem, a powerful deterrent to bad behavior. Sounds good, right? So what’s the catch? You may be thinking that the blockchain is yet another “solution” in a long line of others you’ve purchased, and that you’re not ready to rip everything up and start again. The good news: you don’t have to. I’ll discuss how you can seize upon the supply chain of the future in the last article in this series.

 

https://www.ey.com/Publication/vwLUAssets/ey-blockchain-and-the-supply-chain-three/$FILE/ey-blockchain-and-the-supply-chain-three.pdf