Fourth Industrial Revolution: Better inventory control

Fourth Industrial Revolution

The term Fourth Industrial Revolution appeared in 2011 in Germany at the Hannover Industrial Fair. The term is mainly concerned with the ideal method for using a group of modern technologies in manufacturing in order to reach the idea of a smart factory. The idea of the smart factory is based on achieving communication between manufacturing equipment, raw materials stock, energy resources, all devices, as well as the personnel in the factory. All communications are made through the Internet, and the machines send information regarding operating conditions around the clock in order to store that information on the cloud for the software to analyze them, draws conclusions and submits reports on an ongoing basis. Several technologies are included under the Fourth Industrial Revolution term, and these technologies can be used together or combined in an industrial system that aims to achieve higher quality and optimal use of energy, as well as achieving the best use of raw materials.

 

Fourth Industrial Revolution Technologies

Technologies include:

  • Internet of Things IoT
  • Cloud Computing
  • Additive Manufacturing
  • The use of industrial robots
  • Augmented Reality

It is noted that all these technologies are linked one way or another to information systems technology, and thus the Fourth Industrial Revolution is a system that links manufacturing with information systems technologies.

Our topic here relates to an example of the use of one of these technologies, the Internet of Things, in an industrial example, in order to achieve the optimal use of inventory.

Internet of things

Internet of Things technology is related to connecting sensors to the Internet that read the surrounding environment conditions and send them to a system connected to the Internet around the clock for the purpose of analyzing and extracting operating information from them.

Our example of making the best use of inventory revolves around a company that works in the field of medical services and operates 15 hospitals in different places. The said company uses cheap sensors that use RFID technology in tens of thousands of inventory items for the company in order to monitor and manage each item in the inventory. In our example, radio frequency technology records and sends information about each piece of stock to an automatic reader, which in turn creates a clear picture of the stock size and location of each piece around the clock. This system can determine the deficiencies in any of the items with utmost accuracy at any time, while giving the appropriate warning in case of shortage to the systems or the specialized persons. The use of such a system achieves the full ability to obtain an accurate and complete inventory of the stock at any moment throughout the day, which achieves great results in eliminating theft and the ability to determine the actual consumption of the stock and then request the renewal of the stock in exactly the right quantities and at the right time.

It is worth- noting that in light of a manual system that does not use one of the technologies of the Fourth Industrial Revolution, this work may require a very big effort and it will be impossible to reach the same result. Hence, it appears clearly that the use of technology increases the efficiency of inventory management and achieves an optimal use of financial resources as well as a higher ability to meet operating obligations. This company has achieved success by using this technology to reduce inventory by 23%, and it sees the possibility of saving five million dollars annually if the system is deployed in all inventory items this year.