Logistics 5.0: The Final Piece In The Supply Chain Optimization Puzzle?

In the manufacturing and logistics industry, the challenges brought about by the onset of the COVID-19 pandemic drove many companies to implement Industry 4.0 solutions. As the end of the pandemic approaches, the accompanying changes will likely push companies to transition towards Industry 5.0.

Businesses are trying hard to stay at the top of their industry by keeping up with the constantly evolving digital world. The main changes in this regard can be seen in the manufacturing and logistics sectors. The manufacturing and logistics industry is integrating its ecosystem with cutting-edge new technologies like the use of IoT in supply chain management. Automation and AI, robotics, language process and lean manufacturing are experiencing a drastic and swift change in technologies that control and support them. The major difficulties faced by this sector in the pandemic times have, however, allowed them to learn positive lessons. The need to handle and face the disruptions effectively during COVID-19 heralded the technological transition to Logistics 4.0. Now, the shift towards sustainability is leading to the transition towards Logistics 5.0.

How COVID-19 Stimulated Industrial Change

The futuristic journey of logistics has been affected by the pandemic immensely. It has spurred a huge shift and significant changes in the logistics and manufacturing sector. The changes and overhaul due to the COVID-19 impact on logistics must be a part of the new environment around the globe by considering factors such as resilience, competitiveness and sustainability.

The logistics demand rose to an all-time high due to people not being able to step out of homes, which led to several problems like scarcity of containers, new security measures and problems with renewing crews, delays, blockades and much more. This highlighted the weaknesses of the classic schemes of the logistics industry and sped up the transition of logistics towards 4.0. Companies in this industry have been forced to invest in innovation and technology to increase resilience and competitiveness in the coming future.

With the pandemic likely coming to an end, the productive system is to be transformed to cater to sustainability and digitization simultaneously. This is where Logistics 5.0 comes into the picture. With the need for both sustainability and digitization, the Logistics 5.0 revolution is required.

 

IoT in supply chain

Allerin

How Logistics 4.0 Led to Digitized Automation (Big Data, Robotics, and IoT) in Supply Chain

The core of Logistics 4.0 consists of technology and its amalgamation into the logistics sector. Logistics 4.0 uses the information to add and improve the operations and processes of supply chain management. Blockchain, cloud and other technologies help secure the exchange of data and keep the logistics sector decentralized in a very convenient manner.

Smart equipment like management systems for warehouses, pallets, robotic transport and containers act as a pillar to automated supply chains and help extract and create a greater value from each piece of equipment. Data readers, smart shelves and autonomous vehicles are some of the smart types of equipment that help workers. Artificial Intelligence (AI) is another pillar of Logistics 4.0 that helps achieve highly efficient supply chains. Logistics 4.0 uses shipments, supplies, and orders that are prepared and packed depending on the sales forecasts predicted by the use of big data and machine learning.

GPS technology also helps the logistics industry by helping in tracing the real-time and exact location of the goods and therefore reducing risks, allowing route optimization and increasing cargo control. RFID tags that are accessible via tablets and mobiles offer data that allows operators to interact with and track their merchandise at any time.

All these technologies, when combined and integrated, boost the performance of the entire supply chain process in terms of flexibility, transparency, integration, efficiency, collaboration, quality and responsiveness. A cyber-physical system is created over the supply chain by these combined technologies.

This digitization of Logistics 4.0 allows companies to keep up with the new demands of the customers. It ensures that they meet the customers’ requirements and expectations on the supply side through efficiency and improvement. Supply chain 4.0 is flexible, fast, and accurate.

However, as Logistics 4.0 separates the operations and works of machines and humans, revolutionaries are propounding the idea of the fifth Industrial Revolution or Logistics 5.0, which will reconcile humans and machines. While Logistics 4.0 dictates that a better performance is received when the work is more automated, Logistics 5.0 explores the idea of what benefits could be extracted by combining the workforce of humans and machines.

How Logistics 5.0 Will Change the Game

Logistics 5.0 is the proposed response and solution to the 5.0 industry model. And just like Industry 5.0, Logistics 5.0 also focuses on knowledge and sustainability. This is a transition centered on workers and minimizing environmental impact. Logistics 5.0 has enabled companies to undertake the change from digital automation to a collaboration of digitization and human effort without compromising or neglecting competitiveness and profitability in their businesses.

The idea of Logistics 5.0 prioritizes the environment while integrating it with technological innovations. This concept requires the logistics industry to move in three directions:

● Human factor

● Resilience

● Sustainability

Under Logistics 5.0, workers are considered an investment in the long term and their well-being and training are a vital concern for the company and its logistics hub. Technologies need to be replaced, added and adapted according to the needs and requirements of the workers. This ensures that the company benefits by attracting better talent to work with and retaining their services in the long run. This makes it clear that the paradigm of Logistics 5.0 involves stepping up the game from Logistics 4.0, where the dependence is on technology, to improve and consider the ecological and social benefits.

Logistics 5.0 will lead to an unprecedented reduction in cost, errors and time, leading and paving the way for a better and sustainable logistics industry.

 

This article was written by Naveen Joshi from Forbes and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to legal@industrydive.com.