How Cement Manufacturers Transform Supply Chains with Digital

Mar 22, 2021
Manufacturing | 8 min READ
Why Supply Chain Optimization Is Critical to Cement Industry
As digitization paves the way to a new world with fresh challenges, the dynamics of the businesses and their landscape shows a radical shift. The cement industry, particularly its supply chain, is reacting to this transformation by embracing 4.0 industrial technology. From Big Data Analytics to intelligent communication, 4.0 creates value and helps businesses gain a competitive advantage over their peers. Combining the latest technologies, AI, and the Industrial Internet of Things, the cement manufacturers effectively manage the massive energy consumption, surging prices, simplifying a complex system by operating on the intrinsic of the industry.
Raj Pradhan
Raj Pradhan

Practice Director

Construction and Building Materials Vertical


Artificial Intelligence and Industry Internet of Things in the cement industry is catching up fast. The new AI and IIoT technologies are like a refreshing wave. Implementation of these advanced technologies creates more openness in the system and aims to plaster the various challenges that come with supply chain optimization.
Supply Chain and Logistics Challenges in Cement Industry
Lack of supply chain visibility
With complex supply chains spread across geographies, cement manufacturers must look at smarter solutions to improve operational surveillance. Increased demand for cargo pickups from different locations and their delivery to hubs combined with restricted truck times, regulation policies, and changes in customer expectations make planning difficult and challenging. Proper visibility is necessary to understand where an item is in the supply chain route.
In the current times, customers need to have end-to-end transparency of the sourcing and delivery procedure. This market dynamism requires strategic supply chain management and flexible scalability as the demand grows. Smart businesses are embracing the industry 4.0 approach.
Stay Ahead
Visit our Building and Construction Materials page
They are further exploring and investing incessantly in new edge technologies like artificial intelligence, machine learning, business analytics, and digital control towers to enhance Supply Chain and Logistics Visibility.
The high degree of volatility and latency in demand patterns
Even without the pandemic-induced volatility, supply-demand uncertainty is a major concern for the cement players. Industries need to produce and have enough inventories to meet any sudden rise in demands. Uncertainties during the pandemic and keeping operations up and running to meet customer's demands have led organizations to adopt demand sensing and machine learning technologies in their supply chain. The manufacturers use exclusive external data sets such as location, stock-outs, weather conditions, point-of-sale data to have a true view of the customer and channel demand. Since the beginning of the pandemic, businesses that were smart to integrate machine learning for demand forecasting have achieved 90% accuracy with a 3-month lag compared with 60% accuracy from manual forecasting techniques.
Inefficient logistics and plant operations
Ignored and unmanaged logistics, inefficiency in the distribution centers and manufacturing plants impact the supply chain's cost significantly. Smart cement plants today are uncovering the operational inefficiencies and turning them into fully functional capital with the help of IIoT. IIoT enhances traceability, improves supply chain efficiency, and combines with big data analytics and machine-to-machine communication to identify logistics and operations' inefficiencies through historical data analysis. Businesses have a better grip on managing their operating expenditure now. By integrating smart technologies, they can go beyond the automation of plant operations and optimize profitability by augmenting time to market while improving services.
Supply Chain and Logistics Challenges in Cement Industry
Supply Chain and Logistics Challenges in Cement Industry
AI and IoT in Cement Industry – Top Supply Chain Use Case
Plant-wise summary and inventory visibility at silo level
According to a PWC study, digitized supply chains are a major revenue booster for heavy industries like cement manufacturing. An outbound supply chain performs complex tasks from inventory procurement to the distribution of finished goods. It also includes streamlining demand, inventory sourcing, and distribution to all channel partners in the chain. Thus, transportation and inventory management is one of the biggest challenges for the cement industry.
From the quality of the coal to the end product's chemical properties, dozens of variables come into the picture for a successful plant and inventory management. Therefore, optimization across the supply chain is a necessity. The digital twin model makes it a cakewalk by simulating the entire production process in a simplified manner. This digital model generates scenarios across the entire production site based on which equipment and settings are optimized for achieving the desired output levels.
Several smart IIoT and AI solutions have to coordinate effectively to improve the overall business processes. Multiple data points came together in tracking and tracing information. Automation of pic pack loads, tracking activities, performing routine tasks with greater speed and accuracy, making snap decisions with predictive analytics, and achieving zero-error preventive and predictive maintenance in cement plant, deployed with smart solutions.
Order tracking, receipts, and monitoring
Demand forecasts help manage the demand and supply of the product, ready-mix cement, and concrete suppliers. A consolidated network of checkpoints and milestones needs to be monitored for an organized transaction. This ensures that all the physical flows are in line with the overarching business strategy and documentation.
Businesses must put a schedule and structured document of the order, maintenance, and delivery processes. The intervention of AI and IoT simplifies the process resulting in proper quality control and improved efficiency. For instance, a transportation manager needs to check on intricate details like transit times, rates, and weight limits for the suppliers and warehouses. Similarly, customer service agents process orders and must ensure that order contracts, invoices, receipts, processing time, and delivery are tracked and updated in the master data. Suppliers depend on schedules to understand day's loads and off-loads, keep a tab on time and ensure everything is ready for dispatch. With the support of these advanced solutions, they connect with dispatchers for a timely delivery. Along the process, they have to deal with last-minute delays, cancellations, and traffic. Reliable AI and the industrial internet of things ensure improved delivery through actionable insights.
Auto replenishment and replenishment analytics
Managing the cement industry's inventory, especially if it is spread over many SKUs across different locations, is a costly affair. Moreover, these manufacturing lines come with their own bottlenecks. Implementing a stock replenishment system is one of the most effective ways to go about it.
Smart industrial IoT brings in innovation by customizing solutions according to the business needs. IIoT enables the cement industry to monitor these stocks in silos remotely and optimize replenishment routes. A collaborative cloud platform automates replenishment with a thorough analysis of stock inflow and outflow. With these intelligent solutions in place, the cement manufactures can:
Smart industrial IoT
  • Step up their replenishment process
  • Keep track of the timelines through notifications and alerts
  • Minimize waste through automated planning
  • Reduce human error and keep an eye on the stocks and inventory processing.
  • Detect and resolve conflicts at the earliest to enhance productivity.
  • Ensure no stone is left unturned and business running when demand is at its peak.
Automated cement reordering
When it comes to identifying areas of cost savings in the cement industry, IIoT proves beneficial by inducing industrial automation. AI assets and Industrial IIoT automate every task end-to-end. The simplified solution prepares and analyzes data through various tools and techniques, from consolidating millions of data-points to processing numerous variables. From machine profiling to order automation, IIoT architecture touches every bit of it.
With IIoT at the center, a connection is established between smart factories to turn it into a smart grid of comprehensive ecosystems. It can help in:
  • Mapping advanced techniques and algorithms using advanced analytics and design software
  • Optimizing asset and controlling systems via multiple data interfaces
  • End-to-end order requisition, from listing to delivery
  • Placing reorders and monitoring the entire stock
AI and IoT in Cement Industry – Top Supply Chain Use Cases
AI and IoT in Cement Industry – Top Supply Chain Use Cases
Continuous level monitoring (cement, aggregates)
Continuos tracking and measurement of cement powder in storage facilities is essential for production and supply chain. An accurate measurement determines that enough product is available at a particular silo to accept incoming delivery.
Cement silos measurement is a tough nut to crack. Often the dusty and dirty environment makes manual monitoring and ultrasonic measurement unreliable. Integration of IIoT solutions eliminates the need for costly and unsafe manual readings. By placing automated measuring devices in place to monitor the level of cement with accuracy and precision, even at the granular level and during harsh weather conditions, businesses can ensure effective inventory management.
Historical stock level trend by silo
The cement industry shows high volatility at times. Sudden alterations in the geopolitical factors, currency changes, and market conditions force the industry to implement radical measures. Hence, a balanced portfolio strategy acts as a safety net to weather the storms. Advanced AI tools and IoT solutions ensure that stock levels remain consistent with daily fluctuations in demand. This gives an accurate view of the market size, differentiating factors, and critical growth inhibitors through a thorough analysis of the trends and patterns for a considerable duration.
An industry 4.0 approach can enhance cement production in numerous ways. Along with managing the energy consumption, rising cost challenges, and process complexities, these solutions employ comprehensive real-time data, historical data-sets, and models to manage outcomes. Using machine learning algorithms to analyze data, deploy simulations, and discover the root causes of each machine's past mishaps acts as a safety net for uncertain times.
With the ecosystem shifting gears towards Industry 4.0, AI and Industry IoT would be value drivers for the cement industry both individually and in combination. Broadly, through the dissemination of business process automation, organizational flexibility, and digital management of corporate assets, this next-gen technology would bring all the stakeholders under-one-roof through real-time transparent transactions and insights, making information available at the granular level.
Aggregation of all these transactions brings accuracy in outcomes and performance measurement across different levels - customer, industry segment, location-specific - to avoid price distortions.
Was this article helpful?