Abstract
The central theme of this chapter is to provide an overview of new evolving technologies such as radio frequency identification (RFID), the Internet of Things (IoT), service-oriented computing, and blockchain for advancing supply chain management (SCM) towards sustainability. First, the chapter evaluates the capabilities of Industry 4.0 for sustainability under different technology uses. The chapter expands beyond Industry 4.0 by discussing the capabilities that blockchain technology can offer for increasing sustainability under three main areas: (i) enhance visibility across the entire product lifecycle; (ii) decreasing development and operational costs; and (iii) providing sustainability monitoring and the benefits of having strategic data-sharing practices that help companies concentrate with customers and engage in novel partnerships. Finally, the chapter presents an information system architecture consisting of IoT and blockchain technology to maintain data security and transparency.
TopIntroduction
All businesses today appreciate the value of supply chain management (SCM) and sound operational practices, and the advantages of digitization of its business processes have become a popular topic in both sustainable commercial operations and academic research purposes (Pal, 2019). Research has shown that sustainability has become necessary for companies considering social and environmental issues in their strategies. It is also essential that companies and their supply chains must accelerate the shift from focus to sustainability and use technologies to digitalize business processes (Pal, 2019). Companies are already making significant investments in digital supply chains because they recognize that digitalization will give them five big prizes: integration, transparency, productivity, sustainability, and, ultimately, the opportunity to transform their supply chain operating model. Sustainability is essential for accessing global markets and accomplishing high profits (Pal, 2020). For example, while sustainable shipment management was considered a cost in the past, now, thanks to new technologies (e.g., IoT, radio frequency identification, blockchain, and cloud computing), it is possible to guarantee sustainable logistics. Indeed, using these emerging technologies, improving carbon emissions-related issues and saving resources is possible. One of the most critical requirements for sustainable supply chain management demands the transparency of information and appropriate communication mechanisms between the supply chain business stakeholders. In order to earn these goals, it is essential to have adequate information and communication technology (ICT) standards that ensure the reliability of information systems architectures and foolproof security of operational data.
As to emerging technologies, the Internet of Things (IoT) and radio frequency identification (RFID) technology are heavily used in supply chain operations. These technologies can shake up an industry or enable a business model that creates an entirely new way of operations management, even though these technologies may be unfavorable to the users at the early stage (Pal, 2021). Besides, disruptive technologies dominate different industries with new, exciting features that are differentiated from existing technologies (Pal, 2019). Business models based on disruptive technologies are typically more efficient, productive, and convenient than those established on the incumbent technology (Pal, 2020). For example, the IoT has radically changed warehouse and inventory management by tightly coupling distribution centers, transportation, and customer relationship management (CRM) systems. As a result, IoT could reduce operational costs and provide more customized, responsive, and innovative customer service.
The recent emergence of the digitation of supply chain business processes is attracting massive attention from academics and practitioners. However, evaluating and adopting new technologies in supply chain operations are strategically complex. Strategic thinkers are putting forward a cautious reminder that digital supply chain transformation projects are not all about doing everything at once. Instead, commercial industries need to consider the scale of the opportunities across the supply chain and the risks involved, prioritize those technology interventions that impact most on supply chain regular operations, and deliver outcomes that best support corporate strategic goals.
Moreover, the data exchanges between autonomous networks over untrusted channels are also significant. Blockchain technology opens new dimensions towards the data exchange mechanism, intelligent resource management, user access control, audibility, and chronology in stored transactions to ensure data security, privacy, and stakeholder trust. Besides, academics and practitioners are concentrating their research activities on two particular areas: (i) supply chain management-related sustainability issues and (ii) deploying emerging technologies to improve the supply chain business-partners collaboration. In doing so, they are ensuring broader business operations transparency and traceability of resources along the supply chain networks by exchanging operational data.
Key Terms in this Chapter
Blockchain: In simple, a blockchain is just a data structure that can be shared by different users using computing data communication network (e.g., peer-to-peer or P2P). Blockchain is a distributed data structure comprising a chain of blocks. It can act as a global ledger that maintains records of all transactions on a blockchain network. The transactions are time-stamped and bundled into blocks where each block is identified by its cryptographic hash .
Decentralized Computing Infrastructure: These computing infrastructures feature computing nodes that can make independent processing and computational decisions irrespective of what other peer computing nodes may decide.
Supply Chain Management: A supply chain consists of a network of key business processes and facilities, involving end-users and suppliers that provide products, services, and information. In this chain management, improving the efficiency of the overall chain is an influential factor; and it needs at least four important strategic issues to be considered: supply chain network design, capacity planning, risk assessment and management, and performances monitoring and measurement.
Internet of Things (IoT): The Internet of Things (IoT), also called the Internet of Everything or the Industrial Internet, is now a technology paradigm envisioned as a global network of machines and devices capable of interacting with each other. The IoT is recognized as one of the most critical areas of future technology and is gaining vast attention from a wide range of industries.
Block: A block is a data structure used to communicate incremental changes to the local state of a node. It consists of a list of transactions, a reference to a previous block and a nonce.
Immutability: This term refers to the fact that blockchain transactions cannot be deleted or altered.
Provenance: In a blockchain ledger, provenance is a way to trace the origin of every transaction such that there is no dispute about the origin and sequence of the transactions in the ledger.
Cryptography: Blockchain’s transactions achieve validity, trust, and finality based on cryptographic proofs and underlying mathematical computations between various trading partners.
Warehouse: A warehouse can also be called a storage area, and it is a commercial building where raw materials or goods are stored by suppliers, exporters, manufacturers, or wholesalers, they are constructed and equipped with tools according to special standards depending on the purpose of their use.