Rise of the smart factory: Implications for distribution and logistics

Categories: Distribution / Supply Chain, ERP
April 3, 2018
Distribution management software

With integrated information systems, companies can use the digital supply chain to improve logistics and inventory management.

Linear supply chains, long the traditional way that manufacturers managed production, are being replaced by dynamic, interconnected systems that are integrated and collaborative. The smart factory today can use these dynamic tools to improve efficiency, reduce operational costs, and boost revenues by working more closely with supply chain partners.

As noted in the recent post, Rise of the Smart Factory: Evolving at the Speed of Business, smart factories are using new technologies to collect, analyze, report on, and use data that create enterprise-wide opportunities to improve operations. This post considers the role the digital supply chain plays in transforming organizations.

The traditional supply chain used a linear progression: Design, Plan, Source, Make, and Deliver. Today’s digital supply chain is far more interconnected, with share and connect information from multiple locations and sources.

The difference in supply chain types is the continuous flow of information that can be used by multiple areas within the organization. These data allow for more automation, better workflow and analytics, and more insights. A digital supply network has the following traits:

  • ‘Always-on’ flexibility. Traditional and new data sets that include information collected from sensors and locations enable rapid responses to changing conditions within the network.
  • Connected partners. Seamless, real-time communication and collaboration with suppliers, partners, and customers means companies can now see and use network-wide insights from data that is centralized, synchronized, and standardized.
  • Intelligent learning. Learning is promoted throughout the enterprise for workers and machines, allowing for on-the-spot decisions informed by analytics and predictive insights.
  • Transparency. There is improved visibility throughout the supply network using sensors and location-based services. The benefits include better material flow tracking, scheduling, supply and demand balancing, and improved financial performance.
  • Better decisions. Contextually relevant information enables more transparency and the reduction of internal silos. With multiple units providing and using data, improved decision-making optimizes performance, helps meet financial objectives, and factors in multiple trade-offs.
Distribution management software

Automated tools and connected objects provide information in real time for better decision-making in smart factories with digital supply chains.

Planning for the digital supply chain

Companies looking to adopt digital supply chain technology need to assess how to capture information from the physical world and record it as digital information, the physical-to-digital transformation. That information then needs to be presented and integrated with information from other supply chain partners (digital-to-digital).

The information gleaned from multiple digital channels needs to be stored, displayed, and actualized. The results need to be translated from digital insights to actions that are applied within the smart factory.

Using the right tools is critical. The NexTec Group helps companies identify the right distribution management software tools that will drive innovation and efficiency. NexTec consultants identify the needs and facilitate the selection of the right vendors that drive smart factory development.

Acumatica Cloud ERP provides an enterprise solution that helps create the right ecosystem to create the digital supply chain. With Acumatica distribution management software, companies can fully integrate sales orders, inventory tracking, order fulfillment, purchasing, and customer support.

Download the NexTec Corporate Brochure to learn more how NexTec Group can help your company strengthen the impact of its supply chain.