Without purchasing, Industry 4.0 will not take place
If we take a look at the development of industry, it quickly becomes clear that we are living in very exciting times. From the beginnings in 1784, Industry 1.0, with loom and steam power, things have steadily progressed and we have now reached Industry 4.0: Big Data, automation, artificial intelligence, clouds, etc. In this context, purchasing acts as a mouthpiece to the supplier when it comes to innovative technologies. But what exactly does this look like?
Shutterstock.com | Iurii Motov
Let's first look at what has changed for purchasing compared to Industry 3.0. Back then, we talked about the digitalisation of purchasing processes or the early integration of purchasing into processes. Purchasing was seen as an interface manager, commodity group and supplier management was set up and we were doing a lot in the area of value analyses. In Industry 4.0, we are now experiencing the networking of the entire supply chain. This results in a gigantic database that we didn't even have in mind a few years ago.
From floppy disk to smartphone
I can still remember typing my first order as a buyer on a typewriter in 1989. One year later, there was already a PC with floppy disk and co. Only a short time later, everything ran via large data centres. And today we have arrived in the cloud and can call up and operate our ERP system from anywhere via smartphone or tablet. In the age of Industry 4.0, purchasing plays an important role. In the context of innovation and networking, I came across an interesting cooperation partner a few months ago. This partner offers trend-based innovation consulting and has already compiled more than 50,000 innovations worldwide that provide buyers with highly interesting topics. For purchasing, such or similar cooperation partners are worth their weight in gold in Industry 4.0.
Spare parts from the 3D printer
I would like to explain another progress that also affects purchasing with the help of my own experience. I used to work as a manager in prototype purchasing. In a large international department with about 25 buyers from different countries such as Brazil, Sweden, England, Germany, Italy, etc., our task was to buy technical prototypes for the production of a vehicle. About five years ago I remembered that time again, because there I came into contact with the topic of 3D printers within a project. A quality manager showed me a bumper from the printer and I almost fell over. The technology in this area has advanced more and more since then and some companies now produce e.g. spare parts in their own 3D printer. Situations like this show us how far technology has already come - and does not stop at purchasing.
Industry 4.0 consists of numerous innovation opportunities that companies and especially purchasing should use for themselves. One of my customers, for example, has changed its C-parts management. Sensors are now used there that log when screws, nuts or the like are removed from the shelf and report this to the cloud. As soon as the stock runs low, a certain quantity is automatically reordered. This saves the purchasing department and other employees an enormous amount of time.
The fact is: Purchasing is an essential part of Industry 4.0 and derives a great deal of benefit from it, but must not sit back and relax, but must stay on the ball when it comes to innovations.
How far along is your purchasing department in these topics? Which innovations are you already using? I am curious to know what Industry 4.0 means for you and your purchasing department. Feel free to write to me on LinkedIn or arrange a personal meeting.
You can also listen to more on this and other topics for future-proof strategies in purchasing in my podcast.