Industry 4.0 and sustainability in chemical supply chains

Industry 4.0 plays a crucial role in promoting sustainability and safety in supply chain logistics, particularly in the context of hazardous chemical transportation. Its increasing integration calls for collaboration between the chemical industry and logistics service providers, to ensure the safe and efficient movement of chemicals. Mr. V Raju, Business Head, Contract Logistics – Chemical, Allcargo Supply Chain, shares his insights.

‘Industry 4.0’, a recently coined term, refers to the convergence of manufacturing with the digital revolution, artificial intelligence, the Internet of things, and with every device called ‘smart’.

Real-time communication, Big Data, man-machine interfacing, remote sensing, monitoring and control, autonomous equipment, and interconnectivity are all considered as part of Industry 4.0 and are non-negligible assets in industries that face fierce competition and seek to improve productivity and reduce costs.

Industry 4.0 and sustainable warehousing in chemical supply chains

When it comes to creating sustainable value, there are several practices that warehouses can implement. Some such approaches include automating both warehouse solutions and management processes, increasing energy efficiency within a warehouse, and optimizing warehouse design.

In addition to implementing warehouse management systems (WMS) in their warehousing processes, it is also likely to work well for organizations to incorporate other automated solutions including order-picking technologies (pick-to-light technology, voice technology, sortation systems, etc.), bar-coding, radio frequency identification (RFID), and automated storage and retrieval systems (ASRS) to achieve a sustainable warehousing system.

In a business landscape like chemical warehousing, where competition is rife, an ASRS could potentially help cope with rising business pressures, increasing labour costs, intensified calls for safety, and the need for tighter security. In addition to productive sorting and retrieving processes, an ASRS is particularly useful in minimizing the warehouse footprint as it offers innovative storage solutions. Utilizing vertical space within a warehouse, ASRS is capable of handling and processing a higher volume of orders in each period of time and space. ASRS can also help organizations avoid unfavorable environmental impacts that may result from constructing a new warehouse.

Key benefits of Industry 4.0 in chemical warehousing

Optimization: Smart warehouses bring with them optimizations and a growing ability to self-optimize operations, leading to nearly zero downtime of machinery. Optimization plays a major role in keeping high-end equipment maintained efficiently, by having the right resources in the right place at the right time. Being able to utilize capacity constantly and consistently, is better than a major downtime or changeover.

Customization: The interconnections of smart factories, warehouses, and the Industrial Internet of Things (IIOT) means that supply chains are shortened to a point where they need to be agile to customer demand. Communication between the customer and 3PL provider will take place directly, cutting out multiple levels and back and forth. Smart Manufacturing, backed by smart warehousing, allows for ease in scaling production, supply, and delivery, up or down, in line with market demand.

 Reduce Costs: Implementing smart warehousing may have a large initial up-front cost, but if setup correctly can have a positive impact on the bottom line, as implementation of automation, systems integration, data management, and artificial intelligence, all play a major role in enhancing productivity, efficiency, and consequently, profitability. Improved use of resources, faster operations, fewer quality issues, less waste, lower operating costs, and assured adherence to safety help deliver cost savings.

Technology: Technology is progressing exponentially and increasingly impacting daily life and business. Digital advances will create unmatched opportunities for manufacturers, supply chain solutions providers, and end consumers looking to disrupt markets and find new ways of doing business. When one talks about sustainability under Industry 4.0, one can never forget the role of safety in the chemical supply chain or chemical logistics space, which Industry 4.0 endeavors to promote in a big way as well.

Navigating chemical supply chain challenges

Various measures can be taken to enable the appropriate implementation of Industry 4.0 principles in the chemical logistics and sustainable warehousing space, and ensure safe storage, transportation, and delivery of chemicals.

• In the case of warehouses that store chemicals and/or materials that may be hazardous to humans, plants, animals, or the environment, it is extremely important to have a design that ensures safety.
• Warehouses should have trained staff to handle the packaging and transportation of hazardous chemicals, and they should be made aware of the new and emerging trends and technologies.
• Route optimization should be such that it minimizes the impact of a lack of robust transportation infrastructure.
• No matter what the nature of the chemicals being transported, MSDS (Material Safety Data Sheet) should be properly followed to prevent chemical disasters resulting in loss of productivity.
• The warehouse design should aim at the desired utility of space, orderly layout, safe product storage according to hazard, safe warehouse operations, emergency handling, and security of the warehouse.
• The chemical warehouse should ideally be situated away from residential areas, and heavily populated places, area should have good connectivity of roads, and emergency centers like hospitals, police controls, ambulances, fire services etc.
• Globally harmonized system (GHS) hazard class should guide hazardous product storage, as well as labeling and hazard communication.
• Chemical transportation must be carefully planned and controlled at every stage – from the production facility to the end user, including the type of containers used, the modal mix, real-time information and tracking to minimize risks, etc.

Continuous improvement of safety and security standards will remain a high priority for chemical companies as they integrate the principles of Industry 4.0, and this creates the need for continuous engagement at strategic and tactical levels between the chemical industry and logistics service providers.