Inhibitors of Industry 4.0 and Circular Economy in Manufacturing Industry Supply Chains

Introduction

Globally the products and services storage and distribution are still a big challenge. Every year food loss worth 2.6 trillion USD is registered, which could have fed more than 8 million hungry people. The alarming thing is that most of these losses, approximately 14% are on account of poor Supply Chain Management (SCM). Hence, with the growing crises, the manufacturing companies are looking for solutions to control this situation by relying on Industry 4.0 (I4.0) and Circular Economy (CE) practices. It is evident from the market that emerging technologies have enhanced the performance in many other sectors. An effective and innovative SCM helps to meet the demand and supply, leading to higher customer satisfaction (Chandrasekaran & Raghuram, 2014; Hu and Li., 2022). As evident from the trends, customers are becoming more demanding in this dynamic world, thereby adding an onus on the companies to adopt a niche approach in value creation and distribution (Handayati et al., 2015; Khan & Haleem, 2021). A well-guided collaborative effort by creating an alliance with the manufacturers, producers, and distributors is found to be a reliable way to sustainable digitalization (Fu et al., 2017). Since its evolution in 2011, I4.0 smart technologies like Virtual Reality (VR), Cyber-Physical System (CPS), Industrial Internet of Things (IIoT), Cloud Computing (CC), Data analytics have made a significant impact on all spheres of business (Lasi et al., 2014; Oesterreich & Teuteberg, 2016). The improvement is visible in the quality, environment friendliness, production cycle, and product life cycle (Bai et al., 2020; Moeuf et al., 2018; Tortorella & Fettermann, 2018). Nevertheless, the technology also has empowered the companies to achieve excellence in maintaining transparency, visibility, and flexibility at every point of the supply chain (SC), leveraging the global influence and operational excellence (Hofmann & Rüsch, 2017). Now the decisions are based on real-time data, allowing decision-makers a crystal clear understanding of the problem (Casado-Vara et al., 2018), making the decisions more viable and trackable (Bai et al., 2020; Banerjee, 2019).

CE promotes the optimum use of the resources by emphasizing appropriate methods of recycling, reuse, and recovery (Luttenberger, 2020). This approach gives rise to the high level of operational efficacy and effectiveness in converting the age-old business models into more competitive and progressive models (Geissdoerfer et al., 2017; Ghisellini et al., 2016; Lopes de Sousa Jabbour et al., 2018; Rajput & Singh, 2021). The net realization of the benefits is also governed by the degree of customization and company agility (Lakatos et al., 2021; T. T. Pham et al., 2019).

The impact of CE is much visible in the SC, dedicated to the redistribution of refurbished, recycled, repaired goods for reuse or return (T. T. Pham et al., 2019). CE implementation is a collaborative effort among customers, manufacturers, regulators, and suppliers. Once it receives the right technology support, this integration can shape the efficient and environment-friendly business practices that are bound to lead to sustainable development (De Corato, 2020). Another benefit of CE is that it allows process visibility, reliability, viability, and traceability link no other methods provide, but there is a cost associated with this in terms of capital, social, environmental, and economic challenges, which at points may burden the company (Kamble et al., 2020). India is known for its massive manufacturing and production capacities, making it one of the largest contributors to the global economy. This is also forcing the nation to adopt sustainable CE practices (Mangla et al., 2020).