Due to technological advancement, industrial revolution was born. Industrial revolution is expected to continue in the 21st century. The new revolution is known as Industry 4.0 in which intelligent networks are arising from both innovative and communication technologies. Industry 4.0 emanated from the Germany due to the industry’s professional interest of knowing the Germany’s future in industrial revolution. Internet of Things (IoT) is a major factor in the industrial revolution since it improves the level of connectedness as well as the development of Cyber Physical Systems (Li and Li, 2017, p.72). There is a close association between Industry 4.0 and IoT and in some instances, the two have interchangeably used. Various sectors have adopted the use of IoT and they include; manufacturing, transport, building and monitoring of the environment.
As a result of globalization, environmentalism and customization, the need for efficiency in manufacturing industry has witnessed an immense growth. Due to these new demands, there is an increase in development of a new technology in which new business opportunities are simultaneously arising. Within this rapid development, logistics and supply chain sector is among the critical components owing to the need and the possibility of developing and optimizing so as to meet this demand. IoT facilitates the provision and sharing of the appropriate information hence enhancing optimization t on a the basis of higher automation level oof the inbound and outbound logistics (De, Shee and Miah, 2021, pp.624). With cross-sectional transparency, the efficiency of operation safety, and experience of the customer experience is greatly improved. This is facilitated by the reaction and anticipation of the possible supply chain disruption through analysing the fully digital network model. This is aimed at digital display of the physical system (Birkel and Hartmann, 2020). This facilitates use of the innovative systems including; integrated planning and execution systems.
Companies have witnessed disruptions caused by the Industry 4.0 as well as IoT and are required to rethink about their supply chain design. Currently, the supply chains comprises of various discrete and isolated steps. There is a need for the stakeholders to be integrated and connected, for the supply chain to be deemed efficient and transparent. Previous research that has been conducted focused on how certain new technologies such as how Radio Frequency Identification impacts the supply chain. Another research sought to identify how the performance of a supply chain is impacted by the time of arrival. These studies investigated specific approaches , however, there is no research that has been carried out to examine the possible impact of connectivity and visibility in a holistic view on the end-end supply chain network(Manavalan and Jayakrishna, 2019,pp.925).
Through connectivity, IoT of things comes with colossal benefits for the supply chain network. Nonetheless, the implementation of IoT in the manufacturing sector is still in its initial stages. Regardless of the existence of the IoT for almost fifteen years, the leaders in the manufacturing industry have been tentative to implementing it. The cause of tentativeness is the unfamiliarity of how the industries will be affected by this new technology. As mentioned above, the absence of the research therefore makes the manufacturing industry fail to understand the most suitable technology combination for creation of visibility through application of the IoT hence enhancing the performance of the supply chain (Ramirez et ál, 2020, p. 5625). The automotive industry is largely affected by competitive challenges. The current challenges faced by the automotive industries are; diverging markets, complexity and cost increment as well digital demands. IoT therefore has the greatest potential in this sector as a result of the competitive environment and complexity (Patwe and Phansalkar, 2021, pp. 594).
The research seeks to undertake an examination of the role played by Internet of Things in promoting the visibility & connectivity of the supply chain in the end-end supply chain network of the automotive manufacturer. This will provide better understanding of how digitalisation of the supply chain impacts on its performance.
The section presents the needed background information to enhance the knowledge about distinct areas of purpose as well as forming basis for further study.
Supply chain comprises of five basic elements which are important in the transformation of raw materials into finished products. The stages include:
These steps are connected through the products flow as well as information and funds in the supply chain network. Physical flow is usually from the supplier to the consumer while information is flowing in both directions, see figure below.
Figure 1: Supply chain elements
From a holistic standpoint, supply chain is dependent on 5 systems of business which are interconnected. The systems are:
The shift to complex as well as global supply chain demands a successful management of the various links. Complex supply chain management is referred to as Supply Chain Management.
According to( Dolgui and Ivanov, 2022,pp .451) ,supply chain visibility is the degree in which the players in the supply chain shares accurate, timely, useful and information in the entire supply chain. Supply chain visibility is aimed at providing support to the process of decision making while improving the performance of the supply chain. Demand forecast accuracy is enhanced through better visibility pertaining to the demand of the customers and the inventory levels. It also facilitates change in plans of production, improves the process of delivery while reducing the inventory levels in the whole supply chain (Anitha, Reddy, Krishnamoorthy and Jaiswal, 2021).
The market responsiveness of is enhanced by end-end visibility of the supply chain between the partners in the supply chain network. It also reduces the risk of supply chain disruptions particularly materials and products flow. Supply chain integration is attained through greater visibility of the supply chain. The collection of accurate, useful as well as complete supply chain information doesn’t necessarily translates into improved performance neither does it have much influence on the responsiveness of the organization to the changes(Kumar and Anbanandam, 2020,p.259). Nonetheless, a higher intensity of integration is positively relates responsiveness and the visibility of the supply chain.
Supply chain connectivity is a collaborative partner connection. The collaboration aims at obtaining and disseminating information by use of ICT across the whole supply chain. Sharing of information across the entire supply chain is facilitated by its connectivity. Information sharing is needed for the supply chain visibility development. The development in technology has made possible for the entities to establish outside connections for sharing of information across the supply chain so as to obtain enhanced visibility of both the activities as well as operations of the customers and suppliers. An effective external linkage is a prerequisite in the visibility of the supply chain, process of decision making as well as the performance of the supply chain (Goswami, Engel and Krcmar, 2013). Supply chain connectivity is the means through which technological barriers are eliminated among the partners in the supply chain while facilitating supply chain management which is more effective.
Every part of the network of the supply chain comprises of information set which can be shared by others through the use of ICT. This information may be shared by the partners in the supply chain in real time by use of a common collaborative platform. Information may be automatically captured through the use of machine-readable identification as well technologies for capturing data. This facilitates tracking of the products under shipment while also determining the status inventory. Supply chain connectivity facilitates the visibility of the supply chain which in turn enables continuous adjustments (Kalaiarasan, Olhager, Agrawal and Wiktorsson, 2022, pp.108464). Continuous adjustments reduces replenish lead times, the inventory levels while improving forecasting of demand.
Logistics 4.0 according (Jagtap et,al ,p.2) refers to inbound and outbound logistics optimization through the use of an intelligent software entrenched in the software and databases where there is provision and share of information through the IoT. Sharing of information is aimed at reaching a high automation degree. It also entails the creation of Cyber-physical systems by use of the bar codes, sensors, RFD technology, and GPS systems. Due to this technological development, the establishment of a supply chain which I individualized, customer oriented, efficient and responsive has been made possible.
The use of Logistics 4.0, has made supply chain analysis as well as forecasting through the use of real time information to be possible. Accurate synchronizing of both events and interactions has been made possible. An urgent intervention can be initiated with Logistics 4.0 when material mishandling or delayed shipments using the information obtained by the sensors (Bag, Gupta and Luo, 2020). There is a possibility that the logistics network can be optimized through greater insights as well as the ability of responding in real time.
CPS is used to describe a wide range of complex and physically aware system integrating inbuilt technologies of computing into the physical world. Cyber is the communication, computational as well as control which is discrete and logical (Lu, 2017, p.1750014). There are two core functions which are involved in a CPS. It includes advanced connectivity which facilitates collection of the real time data from the physical world as well as a feedback of the information from the cyberspace. The other component is intelligent management of data, computational& analytical abilities constructing the cyberspace (Humayed, Lin, Li and Luo, 2017, pp.1802). Another critical component of the CPS is the wireless sensor networks. This facilitates the data collection to be transferred to cyberspace.
IoT is being used in several areas in Industry 4.0 development. The technologies that are used in IoT has been discussed below.
GPS is a technology that is being used for real time tracking of the vehicles, ships and trains by several organizations. The use of GPS in the process of tracking is advantageous since it leads to a transport chain which is very transparent. GPS also leads to an increase in delivery performance due to faster identification of the problem. Faster reaction as a result of delays can also be initiated by use of GPS hence customer satisfaction is greatly enhanced (Hoque, 2016, pp.37). In a situation where the GPS receivers are located indoors, its communication with the satellites is poor and may not provide accurate information about location. Inbound and outbound logistics planning is facilitated through connection of GPS-mapping systems to the resource planning systems of an organization. The utilization of this leads to seamless visibility, improved reliability in making loading decision and improves the capacity of transport. It also provides support to online shipment (Abdel, Manogaran and Mohamed, 2018, pp.628). Apart from GPS, there are other technologies that are used for the purpose of tracking by an organization.
AIS is used in the maritime sector to obtain information regarding vessels. The technology provides automatic information regarding the identity of a ship, its position, type, speed as well as its status navigation. Information obtained enhances tracking in the supply chain as well as the prediction of ETAs for shipments. AIS-obtained information is also being increasingly utilized in tracking of the environmental effects (Kruse et al, 201, pp.30). As by the International Maritime Organization, all ships are obliged to have AIS.
The term is generally used to describe transport solutions, however it is mostly used to refer to technology used in road transport i.e. vehicle telematics. The core function in vehicle telematics is position and data communication function. The function facilitates the tracking of the route that has been taken by the driver. It also facilitates transmission of information, for instance order information and status information. On-board monitoring system is the second major part of the vehicle telematics. This collects the vehicle data (Bujak, Topolski and Miler, 2015). Use of vehicle telematics by the logisticians promotes efficiency in fleet management taking into the account the maintenance of the vehicle, management of the driver, fuel as well as the health & safety management through sharing of information in real time. This results in the reduction of environmental effect.
RFID refers to a wireless communication capable of reading and writing information through the use of radio signals. This means that it does not require optical contact. The RFID hardware is connected to the application of the enterprise through the middleware. RFID can serve as a cheap alternative system used in the identification of goods and it connects the objects and the equipment to the databases. Its use provide useful information that can be used in the improvement of the operation of the supply chain through enhanced visibility & we integration among the stakeholders in the supply chain(Afsharian, Alizadeh and Chehrehpak, 2016,pp.115). RFID is used in the supply chain for automating the tracking of the products, cases as well as assets that are reusable such as bins and racks. One of the limitation that is associated with RFID use is that , after the tracked goods has left the warehouse, its further tracking is interrupted up to when the goods reaches the next stoppage destination supply chain process where reconnection is made.
Researchers have explored a possibility of building IoT solutions by use of the smart phone due to their in-built sensors, for instance, digital compass and the GPS systems. Out of these sensors, features that include; Smart phone Quick Response code reading , GPS tracking as well the multilevel data access control may be offered. Systems that have been initially used in fleet management are held hand-held terminals which resembles smart phones in the present era. This places the smart phones as potential viable alternatives used in collection of data in the field of logistics.
The aim of this research is to obtain an understanding of how the supply chain performance is affected by new technologies in the automotive manufacturing sector.
The study seeks to provide answers to the following research questions:
Research Design
Since the purpose and the title of this research is still new, the research design adopted is open to many directions. The study therefore will adopt an exploratory research approach. The reason as to why exploratory approach is adopted is to obtain new insights while viewing the topic in a new light. The phenomenon under study is the connectivity and visibility of the supply chain(Spector, 2019, pp 125).
Supply chain performance will be the unit of analysis in this study. Abductive reasoning has also been seen appropriate for this research. The Industry 4.0 and Internet of Things are newly undefined areas hence an out –of box reasoning is required. The research thus will use both theoretical findings as well as empirical observations. Quantitative research approach uses deductive reasoning while inductive reasoning is associated with qualitative research. However, abductive reasoning incorporates the two types of reasoning (Connelly, 2016). A qualitative research approach is selected owing to the youthful stage of the research area. Research methods that will be taken into consideration are; qualitative research approach, document studies as well as interviews.
This study sought to examine how supply chain visibility and connectivity is enabled by the IoT. Data will obtained using interviews and documents studies.
The documents used will be of the organizational nature emanating from the selected company. The organizational documents shall include documents such as brochures, newsletter. For the case company, document study entailed 2 booklets of the organisation comprising of the operation concept and the management system. To avoid biasness, the information will be obtained from the documents that have been agreed upon within the company providing a description of the basic standards. Documented information of the company will be used to obtain understanding of the standards, processes and departments within the organizations (Ihsan, Sulaiman, Alwi and Adnan, 2017, pp.13).
The use of virtual documents in research is tremendously growing due to its fast accessibility over the internet. Virtual documents were used in this research to look for new innovative companies as well as solution vendors. Information obtained from the individual website will be used to obtain a basic understanding of every solution(Hinrichs et al, 2015, pp.i50). A preliminary short website study will be carried out on the vendors. The gathered information will include; data input, connecting technologies as well as information outcomes. This established a framework for interviews.
A semi-structured qualitative interview questions will be selected to facilitate higher flexibility. A litany of themes and questions will be developed before the interview is carried out and this varied depending on the interview. In the first round of the interview, the case company employees will be interviewed regarding the current projects in IoT. This provided an understanding of pertaining to the pilot projects that aims to implement IoT technology to enhance visibility (Kallio, Pietilä, Johnson and Kangasniemi, 2016). The sample list of the questions asked during the semi –structured interviews.
Following the first contact with the general topic introduction, a list comprising of the questions will be establish after sending document study to the companies. A sample list of the interview questions is given in Appendix 2.The first set of questions will be open questions to stimulate a discussion to facilitate a proper knowledge of connectivity and visibility in supply chain. (Mojtahed, Nunes, Martins and Peng 2014,pp.47). Interviews will not be recorded by detailed notes will be taken since the data required was simple.
Data will be analysed using conceptualisation based on qualitative research approach as well as the methods of data collection. Following the empirical research at the case company a further research needs to be conducted about the companies which are working with these technologies for improvement of the visibility. On the basis of the grounded theory , the information obtained from the website of supply chain visibility vendors will be will be analysed following a theoretical saturation and coding. The data will be categorized into components parts through the coding process which facilitates categories development. With the aim of answering the research questions, relevant information mainly those identifying the stakeholders will be extracted (Wang, Gunasekaran, Ngai and Papadopoulos, 2016, pp .110). Successive categories will be establish, merged and rearranged in continuous discussion. This will result in 3 types of categories which covers the information demands, data types in supply chain & technologies. The information categories will be arranged in a matrix as shown below:
Figure 2: Layout of the Data Collection Matrix
To provide answers to the research questions, the final analysis will follow the constant comparison process. This will ensure that a handy comparison between the data and conceptualization is maintained which facilitates comparison of the phenomena in every category as well as theoretical elaboration(Seyedan and Mafakheri, 2020,pp.22).
Ethics will be taken into consideration in the study. The identity of each participant will be made confidential. Additionally, the participants were made aware about the research purpose and nature prior to being asked about their willingness to take part in the research. The results of the interview will not be recorded, but instead detailed notes were taken down to make sure than no sensitive information is stored.
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