Orange on 2021: Hardship spurs innovation – and so with Covid-19 and Industry 4.0
The Covid-19 pandemic has deeply disrupted existing ‘just-in-time’ models of supply chain management and manufacturing. Around the world, many production lines ground to a halt in 2020, and a light was shone upon new and existing risks in our supply chains, accelerating fresh approaches to digital resilience, cost control and sustainability.
Historically, times of great hardship have spurred leaps in innovation and problem solving. Just as the very science of supply chain management was born in the wake of the First World War, the global pandemic is hastening the fourth industrial revolution. We predict real and sustained Industry 4.0 deployments over the course of 2021 as business leaders develop end-to-end supply chain transparency and accelerate manufacturing automation investments.
The key to this will be further investment in IoT and connected objects in the industrial sector. This will go hand in hand with the application of 5G to provide real-time data aimed at streamlining supply chain operations and production.
Modernizing supply chains
Supply chains involve a diverse ecosystem of companies in a complex web, connecting sources of production via distribution to consumption. This includes manufacturers, assemblers, warehouses, regulators, freight forwarders, shipping lanes, airports and seaport terminals. With so many different links, there are as many risks disrupting the whole chain.
This system requires intense collaboration and is challenging even today. However, new technologies associated with Industry 4.0 will help to address this long-standing issue, the most significant of which is access to and use of real time data. Using IoT, companies will be able to track materials and components from their manufacturer through transportation and eventual installation where they are needed.
By sending data through connected objects at unprecedented speeds, the whole supply chain becomes more transparent. This increases efficiency immensely. Additionally, using predictive analytics, companies will be able to use the data gathered by connected objects to identify in advance links in the supply chain which may need addressing and react appropriately to avoid delays.
The need to radically rethink the role that data plays in effective supply chains is obvious; however, recent research by Orange Business Services suggests that just 45 percent of organizations today are using real-time data insights to drive better decision-making. We believe this figure is likely to double over the next two years, as 44 percent of organizations plan to launch real-time data initiatives.
Mass data collection through IoT networks and computer vision, combined with edge and cloud computing architectures will be able to facilitate rapid AI-driven analytics. This will enable supply chain planning and execution systems to take real-time data and turn it into insights and action. Ultimately the goal is to use technology to anticipate what will happen throughout the entire supply chain, when it will happen, and why.
Enabling impact of 5G
For the implementation of effective IoT initiatives combined with other technology such as AI, enterprises need more speed and agility across their networks. This need cannot be met by legacy technology that the vast majority of enterprises rely on today.
However, the unparalleled speeds and ultra-low latency provided by 5G will transform these industrial processes, providing real-time data to maximize efficiency in production environments. 2020 was a promising year for 5G implementation with trials of the technology being conducted in industrial settings and validating many of the anticipated benefits of this technology.
For example, Schneider Electric has been able to increase operator efficiency by 25 percent, reduce maintenance costs by 30 percent, and achieve energy savings of more than 30 percent during the trials of advanced technologies run on a private 5G network at its plant in Normandy, France.
As the benefits of these networks become clearer, more companies will experiment with 5G networks, which in turn will enable the true potential of industrial IoT and Industry 4.0.
With vaccinations already being rolled out around the world, the most significant focus for everyone over the course of 2021 will be industrial and economic recovery. A substantial part of this will be modernizing operations and processes from supply chain management through to manufacturing efficiency and productivity where IoT will be key.
Because of this, we expect to see large-scale investment in the technologies that will revolutionize industry over the long-term and expedite the recovery that economies so desperately need in the wake of such a disruptive year.