Key Insights: Three Major Transformations in Manufacturing and the Innovative Development of Smart Logistics

New Trends, New Concepts

01 Three New Trends in the Transformation of the Manufacturing Industry

1. Major Trends in Manufacturing Organizational Transformation: Efficient Supply Chain Collaboration

Supply Chain Transformation: Traditionally, manufacturing supply chains have focused on linking networked chains, with logistics, information flow, and financial flow serving as the three integrated streams that bind a functional, interconnected network. Today, the supply chain is entering an era of profound transformation. Supported by smart logistics and intelligent manufacturing, the modern manufacturing supply chain is shifting toward the integration and convergence of supply chains, industrial chains, and logistics chains, with a primary emphasis on high‑efficiency collaboration.

Figure 1: A functional network chain structure integrating three tiers

Based on the trends of innovation and transformation in manufacturing supply chains, In 2017, the General Office of the State Council issued the “Guiding Opinions on Actively Promoting Supply Chain Innovation and Application,” which redefined the supply chain, stating: A supply chain is an organizational structure oriented toward customer needs, aimed at enhancing quality and efficiency, and leveraging resource integration to achieve efficient, coordinated collaboration across the entire process—spanning product design, procurement, production, sales, and service.

New characteristics of the supply chain: With the advancement of information technology, supply chains have now evolved into three key trends: first, they have entered a new stage of smart supply chains, deeply integrated with the Internet and the Internet of Things; second, smart logistics has been seamlessly incorporated into the supply chain, serving as the foundation for efficient coordination among supply-chain entities; and third, a new trend of comprehensive integration across industrial and supply chains is emerging.

2. Major Trends in Technological Transformation in Manufacturing: Smart Manufacturing and Industry 4.0
Main thread of technological change: At present, the overarching trend driving technological transformation in global manufacturing is intelligentization, and China’s smart manufacturing… The technological roadmap for 2025 is a next-generation intelligent manufacturing theory proposed by Chinese scientists. This theory is a major research initiative of the Chinese Academy of Engineering, involving nearly one hundred academicians in discussions and field studies. It was officially unveiled by Academician Zhou Ji, former president of the Chinese Academy of Engineering, who outlined China’s development path for intelligent manufacturing: digital manufacturing—digital plus networked manufacturing—digital plus networked plus intelligent manufacturing (the next generation).

The path of intelligent transformation in Germany’s manufacturing sector is industrial. 4.0, whose foundational theory is CPS (Cyber-Physical Systems). The United States’ path toward intelligent manufacturing is centered on the Industrial Internet. Major industrial nations around the world have each developed their own new theories of technological transformation in manufacturing, tailored to their national conditions.

3. Major Trends in Manufacturing Process Transformation: Delivery and Service Are Becoming Central to Operations
Path of Transformation: Traditionally, manufacturing processes have centered on production, with procurement and sales serving as the two fundamental pillars. Today, with the advent of the Internet, manufacturing… + The rapid development of the Internet of Things, smart logistics, and digital new‑commerce has led to the comprehensive integration of industrial chains, supply chains, and logistics networks. With manufacturing now directly connected to consumers through short, direct links, the manufacturing sector is shifting from a production‑centric model to one centered on product delivery. Before delivery, this constitutes the pre‑market; after delivery, it becomes the post‑market. The seamless integration of these two phases across the entire value chain gives rise to a complete product lifecycle.

Characteristics of the transformation: The servitization of manufacturing has become a new trend. The “Service Internet” is driving innovation in the aftermarket, with on-demand production and flexible manufacturing emerging as new trends; smart logistics has become a critical pillar for the manufacturing sector, with logistics service capabilities serving as a foundational enabler.

02 Analysis of the Development Paths of Intelligent Manufacturing and Smart Logistics

Informationization: Anything that can reduce uncertainty is information; symbolizing and digitizing these elements to facilitate communication and dissemination constitutes informatization. The most crucial aspect of this process is achieved through digitization, which often relies on human effort—such as manual data entry or manual transmission of information, among other tasks.

Digitalization: The key distinction between digitization and informatization is that, first, data originates from sources not managed by humans, and second, data collection is automated. The primary means of data acquisition is the use of IoT sensing technologies, enabling perception (and collection). - Presentation and analysis are performed simultaneously. This is the essence of digitalization, and it is precisely what gives rise to big data.

Big Data: Digitalization generates vast amounts of data, and the technologies for storing, computing, and processing this massive data are collectively known as big data. However, the computation, analysis, and application of big data remain digital rather than intelligent, because in the end, it is still humans—indeed, in most scenarios, humans rather than machines—who rely on data‑driven insights to make decisions.

Intelligentization: The distinction between digitization and intelligence lies in who ultimately makes the decisions. Only when a closed-loop system—enabling state awareness, real-time analysis, data-driven decision-making, and precise execution—is established, and when machines autonomously make and carry out those decisions, can true intelligence be achieved.

Digital Intelligence: It refers to achieving intelligence through digitalization—namely, digital intelligence, intelligent digitalization, and the integration of digital and intelligent technologies—ultimately culminating in wisdom.

Intelligentization: Manufacturing large-scale systems is intelligent. “Emergence” encompasses both “intelligence” and “wisdom,” enabling self‑learning and the enhancement of cognitive capabilities.

03 Five New Concepts for the Innovative Development of Modern Manufacturing Logistics

1. Modular Logistics

Unitization is the starting point for logistics digitalization: to achieve digitalization, unitization must come first. Data sensing begins with the perception of unitized goods, and the coding of these units serves as an ID card in the digital world.

Unit standardization is the starting point for improving logistics efficiency: Complex and intricate By integrating “items” into standardized,规范ized units, high‑efficiency sorting, assembly, handling, transportation, and storage can be achieved, enabling convenient and highly efficient warehousing, material handling, loading and unloading, stacking, and transport.

Unitized logistics drives innovation in manufacturing logistics: In a logistics system, items are consolidated at the point of origin into standardized, uniform cargo units, and these basic unit‑level shipments are maintained throughout the entire delivery process until they reach the final destination. These cargo units serve as the operational building blocks across all stages of logistics; this approach is known as unitized logistics. The fundamental unit of logistics may be either a containerized unit or a packaged unit. Unitized logistics spans the entire supply chain, with standardization serving as its guiding principle. Containers reshaped the world, pallets modernized logistics, and unitized logistics continues to drive innovation in smart logistics.

2. The “Logistics First” Principle: Design for Logistics (DFL)
The “logistics‑first” philosophy in manufacturing: Before troops move, provisions go first. This forward‑looking logistics approach is a new paradigm driving innovation and development in manufacturing logistics. By front‑loading logistics—starting at the product design stage—and integrating smart logistics into both the industrial value chain and the supply chain, end‑to‑end logistics efficiency can be significantly enhanced. This is the essence of the logistics‑first principle. For logistics design The DFL’s innovative philosophy calls for production‑process planning to begin with the optimization of line‑side logistics, designing manufacturing workflows with logistics efficiency as the guiding principle—echoing Richard Muther’s “logistics first” approach to industrial facility planning. In 1982, this pioneering scholar came to China and sowed the seeds of modern logistics, being among the first to introduce logistics concepts to the country. By integrating smart logistics into the industrial value chain and supply chain from the design stage, it ensures end‑to‑end logistics‑friendliness, enabling substantial reductions in logistics costs right at the source.

What is DFL: DFL (Design for Logistics) refers to designing with logistics in mind by shifting the logistics perspective upstream—starting at the product design stage. It ensures that the product is logistics‑friendly throughout its lifecycle, from manufacturing and sales to warehousing, delivery, assembly, and processing. By proactively aligning product dimensions and packaging with considerations for transportation, storage, distribution, loading/unloading, handling, stacking, and information sensing or data collection, DFL helps reduce end-to-end logistics costs and enhance the competitiveness of the supply chain system.

A smart supply chain requires DFL: Supply chain and logistics encompass the entire process—from raw material procurement and manufacturing to product sales, warehousing and transportation, and final delivery to the end consumer—covering functions such as procurement logistics, shop‑floor logistics, sales logistics, trade logistics, e‑commerce logistics, and express/express‑delivery services. If product designs are unconventional and packaging fails to meet standardized specifications, not only will digitalization of logistics be difficult to achieve, but operations like stacking, loading and unloading, order consolidation, handling, and last‑mile delivery will also face significant challenges, leading to reduced logistical efficiency and elevated costs. Therefore, innovation in a digital and intelligent supply chain requires… The DFL philosophy: designing for logistics right from the product design stage!

Core elements of the DFL: The core principle is standardization, which is reflected in product dimension and specification design, modular assembly design, and unitized packaging design. It is particularly emphasized in unitized packaging and modular product‑assembly design, with the aim of ensuring uniformity and compliance across stacking, storage, and transport packaging. This, in turn, significantly enhances logistics efficiency and the level of digitalization.

A New Concept in Shared Logistics
In the era of smart logistics, logistics resources exhibit characteristics of networking, standardization, and digitalization, laying the groundwork for coordinated resource sharing. Promoting shared logistics can bring about disruptive innovations to manufacturing‑related logistics, significantly reduce logistics costs, achieve energy savings and emission reductions, and foster a new model of green logistics. As for the definition of shared logistics, I propose that it refers to a logistics paradigm in which optimized allocation of logistics resources is realized through resource sharing, thereby enhancing resource utilization efficiency, lowering logistics costs, and driving transformation of the logistics system. At its core, shared logistics hinges on the sharing of logistics resources, which primarily include: logistics information resources, technology and product resources, material‑handling equipment, warehousing facilities, freight‑transportation assets, last‑mile delivery capabilities, and human resources, among others. Sharing mechanisms encompass leasing, exchange, collaborative use, recycling, and circular‑use models, among others. Moreover, there are numerous innovative approaches to shared logistics, as outlined below:

Integrated Innovative Thinking Full-industry-chain support: Industrial cluster development is a key strength of China’s manufacturing sector. With full‑chain local supply‑chain integration, the traditional model of having both upstream and downstream links abroad has evolved into a situation where only product sales occur overseas. This dramatically shortens supply chains, reduces logistics costs, and naturally spurs innovation and transformation in smart logistics.

End-to-end integration: Starting from product design, we are vigorously promoting… The DFL (Designed for Logistics) philosophy ensures that product shapes, dimensions, and packaging are logistics‑friendly; the vigorous promotion of advanced logistics—aimed at enhancing material‑handling efficiency through the redesign and optimization of line‑side logistics; and the fostering of collaborative synergy across industrial and supply chains to bolster supply‑chain resilience—all represent pathways for the integrated innovation of smart logistics in manufacturing.

Omni-channel integration Manufacturing product sales are shifting from a traditional wholesale‑centric model to an omnichannel approach that encompasses wholesale, platform e‑commerce, and direct‑to‑consumer e‑commerce, naturally driving an intelligent, omnichannel transformation of logistics. Consequently, corporate logistics centers must also adapt to this omnichannel evolution.

Logistics Outsourcing and Integration: Logistics outsourcing is integrated into the production process, advancing vendor-managed inventory, and promoting… Just-in-time delivery, the integration of manufacturing and the express delivery sector, and leveraging e‑commerce–driven smart logistics to drive transformation in manufacturing logistics, among other initiatives.

5. Software-Defined Logistics The core value of the Internet is connectivity, which conveys software instructions; for robotics and automation, the core value lies in execution, and hardware-based execution depends on intelligent commands. At its essence, big data is a resource, but it requires software‑driven analysis to inform data‑driven decision‑making. Cloud computing is simply a software‑centric computing paradigm. Only software serves as the critical enabler that realizes the Internet’s core value. Increasingly, innovations in smart logistics are underpinned by software. The “smart logistics brain” is built on a software foundation; the smart logistics information network is constructed atop software; and smart logistics technologies and equipment are becoming increasingly integrated—blending hardware and software—and more flexible. The evolution of smart logistics innovation thus points to a major trend: software‑defined logistics. At its core, software definition entails virtualizing hardware resources and enabling programmable management and control. Software‑defined logistics achieves this by virtualizing physical cargo resources through unitization and digitalization, and by virtualizing technological equipment resources via modularization and digitization of operational units. This, in turn, allows software to manage and orchestrate these virtualized hardware resources in a more open, agile, and intelligent manner, thereby realizing software‑defined logistics. Software-defined logistics is the foundation for the flexible, automated, and intelligent development of manufacturing logistics.