Managing consumables

17 January 2017

Julian Adams of Apex Supply Chain Technologies considers the case for connectivity – automated stock management and its role in the drive towards Industry 4.0

Much is being written and discussed around the fourth industrial revolution, more commonly known as Industry 4.0, as a working methodology set to bring unprecedented levels of intelligence and responsiveness to production processes.

In simple terms, Industry 4.0 refers to the development of a ‘smart factory’ with the focus on connectivity between process elements. For example, embedded computers and networks monitor physical processes so decisions can be made in real time. The computers communicate status with each other and factory operatives via the Internet of Things.

The real-time data now available from these highly sophisticated tools is crucial in informing more immediate production decisions, from detecting and tackling quality issues to complete line changes to meet changing customer demands.

In many instances, the focus of Industry 4.0 to date has been on the production and assembly processes themselves. Where there has been rather less debate is around the crucial services supporting those processes. Yet this is an area where a high level of connectivity, and therefore responsiveness, is readily achievable - to the point that these services can be truly integrated with and into an Industry 4.0 compliant facility.

Managing consumables

One example is the management of crucial consumable items needed for production processes. Any lack of availability of such components has the potential to throw even the most well-planned production schedules into disarray, with potentially missed order deadlines, lost contracts and even reputational damage. It is perhaps surprising, then, that the management of such items frequently remains haphazard.

Typically, such items have been stored in open bins, with operatives able to help themselves, offering little or no control over how many are taken and by whom. This lack of control and visibility can cause major disruption if low stock levels are not spotted and orders not placed to replenish them in sufficient time.

A complete stock-out can result in costly unplanned downtime, with staff having to source components at short notice, often at a significant price premium. Frequently companies hold significant ‘safety stock’ to guard against a stock-out – increasing working capital and a long way from the lean principles to which so many facilities now aspire.

Recent years have seen a more proactive approach to this area, with the availability of intelligent systems now more widespread. Typically, these comprise bins configurable based on the weight of each item. When the integrated detection system detects that weight (and therefore stock) has fallen below a certain predetermined level, a message can automatically be sent via the Cloud to the supplier with a request for a replenishment visit.

The benefits are clear – as long as pre-determined minimum levels are correctly set, there should now never be a complete stock-out. Meanwhile the fact that the system is cloud-based can provide a wealth of information such as usage rates, consumption trends and worker productivity – all vital in supporting the automated ERP process. Meanwhile, the need for safety stock is all but eliminated, freeing up cashflow.

In modern, dynamic facilities, subject to last-minute changes in requirements, a clearly defined stock-holding based on the original plan can leave manufacturers high and dry, asthe unforeseen change can create unanticipated stock requirements that may not be covered unless significant safety stock is held. This is where smart bin systems come into their own as they flag low stock levels in real time and trigger replacement.

Integrating intelligent stock management with the production process can keep the facility operational, ensure ever more stringent customer deadlines are met and support the drive towards Industry 4.0.