Industry 4.0 Adoption in Supply Chain Operations: A Systematic Literature Review

Industry 4.0 adoption in industry and business has grown extensively. Supply chain had an opportunity to adopt Industry 4.0 in improving flexibility, efficiency, and response to consumer demands. Considering Industry 4.0, adoption in supply chain operations must be realized as an opportunity and challenge for practitioners. Hence, this study conducted a systematic literature review with a qualitative and quantitative approach to formulate supply chain 4.0 dimensions and operations in assessing readiness for adopting industry 4.0. A Preferred Reporting Item for Systematic Review and Meta-analyses (PRISMA) and bibliometric analysis are performed to analyze the literature related to industry 4.0 adoption in supply chain operations. This research combined a qualitative and quantitative analysis in reviewing the literature to deliver a broader benefit of Industry 4.0 in supply chain operations. This study found 525 papers related to Industry 4.0. Moreover, only twenty papers discussed supply chain specifically. Literature analysis using quantitative and qualitative approach showed that industry 4.0 adoption in the supply chain is limited to the maturity model with digital transformation. This study proposed five comprehensive dimensions to capturing supply chain operations: technology and information technology (IT) infrastructure, supply chain integration and coordination, manufacturing operations and inventory, leadership and human resources, and sustainability. The proposed dimensions for supply chain operations are based on a conceptual analysis of literature. Further verification and empirical analysis is needed to gain deeper insights. While digital technology and transformation are the main focus of Industry 4.0 adoption in many sectors, supply chain management requires broader applications as it involves various sectors and stakeholders. To further analyze this, a readiness and maturity model needs to be developed to assess the adoption of Industry 4.0 in the supply chain, taking into consideration the proposed dimensions.

Industry 4.0; Maturity; Readiness; Supply chain; Systematic literature review

2.1. Research stages

Figure 1 Research framework

2.2. Data sources

Figure 2 Year of publication distribution of related literature

2.3. Data analysis and performed further research agenda

     In the first stage, literature is collected from Scopus and another database. For the Scopus database, we apply two keywords: ‘industry 4.0 readiness’ and ‘industry 4.0 maturity’. Terms of maturity and readiness are found as the most keywords to describe any industry 4.0 adoption in Industry (Frederico et al., 2020). After moving some duplicate literature, we found 654 kinds of literature. We apply the screening and eligibility process by removing articles from the conference homepage and excluding 113 irrelevant articles.

    We have 525 kinds of literature for further statistical descriptive analysis to see the article types, sources and publishers, and year of publication distribution. A quantitative with bibliometric analysis is also applied using VOSviewer tools to find the research gap and propose the supply chain 4.0 adoption in the industry. A tabular list of relevant literature is provided to find supply chain dimensions to apply in the industry. Finally, we synthesize the further research agenda in implementing supply chain 4.0 in the industry. The further research agenda is formulated based on the keywords networks and literature relations described by Vosviewer, qualitative analysis of the previous research in industry 4.0 and supply chain adoption, and proposed dimensions to assess supply chain 4.0 readiness. Further research agenda is focused on how to apply the dimensions and research gap found in qualitative and quantitative analysis of previous research.

3.1.   Statistical descriptive of the relevant literature

Figure 3 Publisher with ten papers and more with topic industry 4.0

Figure 4 Reviewed articles type distribution

          Previous research has extensively described that industry 4.0 adoption is an opportunity to improve industrial operations and efficiency. Moreover, most of the applications of Industry 4.0 operations are only focused on the operations at the firms. As stated by (Frederico et al., 2020) that there is a limited application of Industry 4.0 in the supply chain. Considering the definition of the supply chain by (Chopra and Meindl, 2013) and (Ballou, 2007), supply chain management organizes many activities, internal and external, of the firms which aim to improve efficiency and effectiveness, produce a high-quality product and the lowest cost, and maximize profit, it is confirmed that this subject is noteworthy to involve in industry 4.0 adoption. According to Tripathi and Gupta (2021) and Dallasega, Rauch, and Linder (2018), considering the supply chain in Industry 4.0 adoption can enhance business activities and transform the entire process from manufacturing to distribution and sales.

          A bibliometric analysis using VOSviewer was applied to analyze the relevant literature quantitatively. Using a keyword network analysis, we found that there are five clusters of keywords linked to each other to Industry 4.0, as shown in Figure 5. A full counting method is applied in this analysis to see the full links and contribution of the authors to the keywords and article (Perianes-Rodriguez, Waltman, and Van-Eck, 2016). We found that the relations between Industry 4.0 and supply chain terms are scarce. It is also confirmed that the application of Industry 4.0 in the supply chain is limited in the current literature and has not been largely discussed. Our result also confirmed that the Industry 4.0 adoption in supply chain operation was mostly published after 2020, as described in Figure 6.

Figure 6 The relations of Industry 4.0 and supply chain in literature

3.2. Reporting findings of SLR on supply chain 4.0

The terms of Industry 4.0 has been largely discussed in developing a system and business process. Industry 4.0 aims to connect the system between a real and virtual factory with the cyber-physical system and the Internet of Things to achieve efficient production. In terms of the objective of the concept, research related to Industry 4.0 has been largely found in the literature. Most of the research discusses the conceptual model, maturity, and readiness level of the business in adopting Industry 4.0.

The Industry 4.0 also influences to the upstream and downstream of the value chains (Asdecker and Felch, 2018), offering a quick response to consumer demand (Manavalan and Jayakrishna, 2019) and improving the supply chain flexibility and transportation (Tjahjono et al., 2017). In the context of carrying out the benefit of Industry 4.0, therefore the supply chain operations must be considered in further Industry 4.0 applications. Moreover, the previous analysis clearly found that there is a limited discussion about the supply chain in industry 4.0 adoption. Literature extracted from the database shows that only a few papers contribute to supply chain 4.0, as shown in Table 1.

Table 1 Literature contribution to supply chain 4.0

Previous scholars defend the one point that Industry 4.0 contributes to supply chain operations, despite its lack of definition and applications.  (Tjahjono et al., 2017) And (Dallasega, Rauch, and Linder, 2018) agreed that Industry 4.0 adoption might improve supply chain flexibility, productivity, product quality, and distribution. Supply chain operations have advantages to win competitive advantages and fulfilling consumer expectations. Besides that, another research also found that the implementation of Industry 4.0 in a supply chain may improve the decision-making process and human-machine interaction system (Van Hoek et al., 2020; Manavalan and Jayakrishna, 2019).

Most of the literature provides the industry 4.0 maturity and readiness model assessment with various dimensions and models. After the extraction process, Table 1 provides a supply chain 4.0 readiness and maturity assessment with various dimensions. From the listed literature, this paper draws a conclusion, as far as the author's knowledge, that previous research was only focused on digital technology and transformation in assessing supply chain 4.0 adoption. Most scholars (see: (Dudukalov et al., 2021; Hellweg et al., 2021; Khan et al., 2021; Lassnig et al., 2021; Hizam-hanafiah, Soomro, and Abdullah, 2020; Gupta et al., 2020; Krykavskyy, Pokhylchenko, and Hayvanovych, 2019)) stated that digital technology and transformation as the most important dimensions in supply chain 4.0 adoption. Moreover, (Tjahjono et al., 2017) delivered that the industry 4.0 adoption for the supply chain is possible to support consumer demand fulfilment and transportation. Focusing on industry 4.0 adoption in the supply chain for digital technology and transformation is not a wise decision since the supply chain is not only about the facility but also about the production process, delivery, coordination, stakeholder, and distribution as defined in (Chopra and Meindl, 2013; Ballou, 2007).

3.3.   Formulating supply chain 4.0 dimensions 

In assessing supply chain 4.0 readiness considers complex factors, indicators must be defined in a specific manner. These indicators are compromised into groups called dimensions (Rajnai and Kocsis, 2018). To formulate supply chain 4.0 dimensions, literature that discussed industry 4.0 related to supply chain implementation is analyzed. Before, a list of literature that discusses supply chain 4.0 adoption has been delivered. After that, literature that focuses on the supply chain 4.0 maturity and readiness model is extracted. The literature that applied to supply chain 4.0 assessment provides a various number of dimensions as depicted in Figure 4.

Figure 7 Number of dimensions considered for supply chain 4.0 in literature

The number of dimensions in each research is diverse. Most papers published before 2020 served less than 5 dimensions to assess industry 4.0 and supply chain 4.0 readiness, while articles published after 2020 provide 5-10 dimensions, except (Shayganmehr et al., 2021) that focus on supply chain coordination. We found that most research that proposed industry 4.0 adoption in supply chain adoption has delivered dimensions. Moreover, it is limited to digital technology and transformation.

The supply chain dimensions in industry 4.0 adoption readiness that is mentioned in the literature is limited. Since most of the literature focus on digital technology and transformation, we proposed new dimensions to assess supply chain 4.0 readiness to capture supply chain operation completely. Five dimensions are proposed, Technology and IT infrastructure, Supply chain integration and coordination, Manufacturing operations and inventory, Leadership, and human resource and Sustainability.

Before, Hizam-hanafiah, Soomro, and Abdullah, (2020) also clustered dimensions for industry 4.0 readiness assessment. This research proposed dimensions for supply chain 4.0 readiness assessment since it was limited to find in the literature. Table 2 shows the proposed dimensions to assess supply chain 4.0 readiness. The first column provides supply chain 4.0 dimensions from previous literature. We cluster dimensions based on meaning and usage. Column 2 shows the number of dimensions that has meaning and usage extracted from the literature. Proposed dimensions are provided in column 3 based and general meaning and its relation to the previous research dimensions.

Table 2 Proposed supply chain 4.0 dimensions

As also stated in the previous research, technology, and IT infrastructure are the most dimensions considered in supply chain 4.0. Using technology and IT infrastructure in supply chain operations may improve stakeholders' connectivity and information sharing to enhance supply chain effectiveness (Preindl, Nikolopoulos, and Litsiou, 2020). There are twenty-one dimensions from previous research related to technology and IT infrastructure. It is also confirmed that applying Industry 4.0 to the supply chain should pay attention to technological advancement and infrastructure. Further, technology is not the only dimension to consider in supply chain 4.0 adoption.

This research found that supply chain integration and coordination and Manufacturing operations and inventory are also needed to consider in supply chain 4.0 since its operations involve many stakeholders. Integrations and coordination using Industry 4.0 technology are still distant, even if it may improve supply chain performance and competitive advantages (Preindl, Nikolopoulos, and Litsiou, 2020; Asrol et al., 2018). In this context, supply chain integration and coordination are clustered based on any dimensions from previous research that are related to the dimensions. It is found that sixteen dimensions from previous research clustered into supply chain integration and coordination which confirmed that this dimension has not been considered, even though the context is supply chain operations.

For the manufacturing operations and inventory, it is found that twenty dimensions from previous research related to this proposed dimension. In other research, (Sanders, Elangeswaran, and Wulfsberg, 2016) also consider Industry 4.0 in Manufacturing operations with a lean approach, which illustrates this scope is necessary to be included in the supply chain 4.0 modelling. We proposed Manufacturing operations and inventory due to fulfilling industry 4.0 requirements in the focal company in the supply chain. Manufacturing operations and inventory involve warehouse operations, productions process and models, efficiency, business model, and smart technology practice in the supply chain, which mostly deal with industry 4.0 adoption.

Leadership and human resource dimension are proposed to deal with resources capability in organization, innovation, and technology (Chumnumporn et al., 2022; Naruetharadhol et al., 2022). We found twenty dimensions from previous research related to this proposed dimension. Human interaction and organization with good Leadership may assist industry 4.0 adoption in supply chain operations.

Table 3 Previous research related to proposed dimensions