Observations from Dr. Klaus Dohrmann, Vice President Strategy and Development, E&M Sector, DHL CSI

“Stephen Covey’s “7 Habits of Highly Effective People” is a decades-old best seller, and I always think about the book when customers ask me for examples of companies that have managed to develop highly effective supply chains.  When we look at supply chains, the single and most significant distinguishing ‘success’ factor is the customer who took an end-to-end, or integrated approach, to its entire value chain – and in many cases, that value chain included suppliers and customers. 

The commitment and foresight to create an end-to-end solution (or service) is a highly effective ‘habit’ customers will want to use in the future as they face the most dominant driver of change in the engineering and manufacturing sector – and that is the change taking place in the manufacturing set-up. 

This includes ‘smart factories’ and the principle of ‘Industry 4.0’ – and how this is changing the role and significance of supply chains within our customers’ organizations. The basic premise of Industry 4.0 is that systems monitor and control the physical and machine processes, and if necessary, could operate autonomously and with no human involvement. The system running a smart factory could develop self-awareness and self-predictiveness – moving production closer to perfect JIT and near zero downtime.

A New Era of New Set-Ups

Such a smart factory could manufacture an entire new array of products, at higher volumes, , in turn, placing greater demands on the customer’s logistics processes, e.g. shorter lead times, chainging transportation mode requirements, increasing number of SKUs and potentially stock levels, and a higher volatility to the entire supply chain. The forces of change could be profound.

DHL has worked hard to build a strong, knowledgeable and supportive community of experts, customers and partners, so we can navigate these changes and challenges – and be resilient - together. 

To learn more about DHL’s perspective on Industry 4.0, digitalization and other topics – join us at the Global Engineering & Manufacturing Conference scheduled for October 9-11, 2017 in Berlin.

Published: August 2017

Image: DHL