EcoProduction Katarzyna Grzybowska, Anjali Awasthi, Rapinder Sawhney

EcoProduction.
Environmental Issues in Logistics and Manufacturing
Katarzyna Grzybowska
Anjali Awasthi
Rapinder Sawhney Editors
Sustainable
Logistics and
Production in
Industry 4.0
New Opportunities and Challenges
EcoProduction
Environmental Issues in Logistics and Manufacturing
Series Editor
Paulina Golinska-Dawson, Poznań, Poland
The EcoProduction Series is a forum for presenting emerging environmental issues
in Logistics and Manufacturing. Its main objective is a multidisciplinary approach
to link the scientific activities in various manufacturing and logistics fields with the
sustainability research. It encompasses topical monographs and selected conference
proceedings, authored or edited by leading experts as well as by promising young
scientists. The Series aims to provide the impulse for new ideas by reporting on the
state-of-the-art and motivating for the future development of sustainable manufac-
turing systems, environmentally conscious operations management and reverse or
closed loop logistics.
It aims to bring together academic, industry and government personnel from
various countries to present and discuss the challenges for implementation of
sustainable policy in the field of production and logistics.
More information about this series at http://www.springer.com/series/10152

Katarzyna Grzybowska•
Anjali Awasthi Rapinder Sawhney

•
Editors
Sustainable Logistics
and Production
in Industry 4.0
New Opportunities and Challenges
123
Editors
Katarzyna Grzybowska Anjali Awasthi
Faculty of Engineering Management Concordia University
Poznan University of Technology Montreal, QC, Canada
Poznan, Poland
Rapinder Sawhney
Department of Industrial and Systems
Engineering
University of Tennessee
Knoxville, TN, USA
ISSN 2193-4614 ISSN 2193-4622 (electronic)

EcoProduction
ISBN 978-3-030-33368-3 ISBN 978-3-030-33369-0 (eBook)
https://doi.org/10.1007/978-3-030-33369-0
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Preface
Changes are becoming faster and more unpredictable. The rapid development of
more new technologies have been introduced in logistics and production.
Accordingly, logistics and production have become more intelligent, more auto-
mated and more complex. Material handling, maintenance, exploitation and supply
chains, become an integral part of manufacturing driven by sustainability. Industry
4.0 creates many new opportunities, but at the same time brings several challenges.
Sustainable logistics and sustainable production are a systemic concern that can be
examined from a variety of perspectives. Sustainable logistics and sustainable
production are also highly contextual concepts.
The book provides interdisciplinary approaches to sustainable Logistics and
Production in Industry 4.0. Sustainable Logistics and Production are vital for
business growth, social coherence and environmental impact reduction. This pub-
lication concerns the multidisciplinary set of studies, researches and projects. The
objective of this book is identify current and future research issues. Challenges and
future perspectives are identified and discussed.
The objective of chapter “Literature Review on Sustainable Logistics and
Sustainable Production for Industry 4.0” is to depict a landscape of the scientific
literature on the concept of the Sustainable Production and Sustainable Logistics.
This concept in recent years is gaining more and more attention from academics and
practitioners. The authors identified a sample of 892 internationally published
papers and conducted a citation analysis to examine the connections between the
many scientific papers and to explore the most influential works.
In chapter “Evaluation of Key Skills Supporting Industry 4.0—A Review of
Literature and Practice”, review of literature targeting Industry and Education
sectors is performed. Canadian manufacturing and service industries and Polish
automotive and pharmacy sectors are investigated.
In chapter “The Role and Impact of Industry 4.0 on Business Models”, the
authors try to answer the question: what new forms will business models adopt?
The aim of this chapter is to identify the challenges related to the adaptation of
business models to the Industry 4.0 concept.
v
vi Preface
The purpose of the chapter “Smart Industry—The Digital Gap in the Process
of the Smart Supply Chain Competitive Advantage?” is analyse the role of digital
technologies ecosystems usage by the Smart Industry sector in gaining competitive
advantage. The main part of the analysis concentrates on the concept of Smart
Industry development.
Chapter “Sustainable Supply Chains Versus Safety and Resilience” focused on
the investigation of the main concepts of supply chain resilience, vulnerability, risk
and safety in the relation to the supply chain sustainability management. The
conducted analysis gives the possibility to highlight the necessity of performing the
multidimensional analyses performance in order to properly manage sustainable
supply chain.
Chapter “Digitalization of Supply Chain Transparency: The Case of ChainReact”
aims at empirical anchoring of the theoretical assumptions that the newest techno-
logical solutions, particularly those connected with the lump idea of Industry 4.0.
will substantially contribute to sustainability of supply chains. The authors use the
example of an advanced tool created by the Horizon 2020 project ChainReact.
While observing global trends, one could notice that more and more suppliers
are monitored in terms of the principles of sustainable development. The purpose
of the chapter “Sustainability as Criteria of Evaluation of Suppliers” is to present
the use by international corporations of sustainability concept as criteria for initial
and periodic evaluation of suppliers.
Next chapter “Sustainable Supply Chain Management in the Perspective of
Sharing Economy” presents reconstruction and interpretation of the key assump-
tions of the sharing economy and the concept of managing the sustainable supply
chain.
Many of the supply chain issues affect the sustainability performance of com-
panies. Since supply chains are complex adaptive systems, appropriate modelling
methods. The chapter “Simulation Modeling and Analysis for Sustainable Supply
Chains” presents guidelines for the construction of coherent and consistent simu-
lation models that would enable multilayered and multifaceted analysis of common
supply chain management problems (e.g. eliminated unnecessary waste).
The chapter “Identification of Logistics 4.0 Maturity Levels in Polish Companies
—Framework of the Model and Preliminary Research” presents the framework of
Logistics 4.0 maturity model (L4MM) developed to provide companies with
opportunity to assess current status with respect to Logistics 4.0 and develop a
roadmap for improvement process.
The chapter “Dynamic Organisation of Traffic Flows in the Transport Network
in Terms of Sustainable Mobility and the Development of Industry 4.0” presents a
concept for the method of traffic flow organization in the transport network. The
aim this chapter is to promote sustainable mobility. Data acquired undergo complex
processing and modification according to the Industry 4.0 concept.
Next chapter “Attractiveness of the Region in Connection with Intermodal
Transport Development” presents evaluate the criteria shaping the attractiveness
of the near-border region from the intermodal transport development point of view.
Preface vii
The evaluation was based on statistic indicators, description data and estimates of
experts.
The concept of sustainable development goal is to increase economic value
while reducing environmental impact and improving the quality of life for humans.
The next chapter “Smart Glasses in Sustainable Manual Order Picking Systems”
tests the potential of smart glasses use in manual order picking systems, as an
example of production system, through the perspective of sustainability.
The chapter “Solutions Dedicated to Internal Logistics 4.0” presents method-
ological arrangement of internal logistics in the context of Industry 4.0. In desk–
research methodology was used for this contribution.
The innovative model becomes a standard in the development of contemporary
businesses. The purpose of the chapter “Manager’s Maturity as a Derivative
of Competencies and Dynamic Capabilities—Vivisection in the Context of Industry
4.0” is attempted assessment of maturity of managers being an answer to the
upcoming fourth industrial revolution.
Planning at the company’s strategic level is as an opportunity to imply orga-
nizational development. The aim of the chapter “Partner Sales Networks as
Determinants of Road Maps for the Development of the Telecommunications
Industry in Poland” presented is the presentation of the potential development path.
The outlooks of the authors are methodical and firm based on their own expe-
riences during their carrier. I hope this book will be extremely useful to the
researchers who are working on the development of newer and sustainable strate-
gies for logistics and production management as a source of valuable information.
Poznan, Poland Katarzyna Grzybowska

Montreal, Canada Anjali Awasthi
Knoxville, USA Rapinder Sawhney
Contents
Literature Review on Sustainable Logistics and Sustainable

Production for Industry 4.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Katarzyna Grzybowska and Anjali Awasthi
Evaluation of Key Skills Supporting Industry 4.0—A Review
of Literature and Practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Rupinder Kaur, Anjali Awasthi and Katarzyna Grzybowska
The Role and Impact of Industry 4.0 on Business Models . . . . . . . . . . . 31
Sandra Grabowska, Bożena Gajdzik and Sebastian Saniuk
Smart Industry—The Digital Gap in the Process of the Smart
Supply Chain Competitive Advantage? . . . . . . . . . . . . . . . . . . . . . . . . . 51
Katarzyna Nowicka
Sustainable Supply Chains Versus Safety and Resilience . . . . . . . . . . . . 65
Tomasz Nowakowski, George Scroubelos, Agnieszka Tubis,
Sylwia Werbińska-Wojciechowska and Maciej Chlebus
Digitalization of Supply Chain Transparency:
The Case of ChainReact . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Łukasz Jonak, Agata Rudnicka and Renata Włoch
Sustainability as Criteria of Evaluation of Suppliers . . . . . . . . . . . . . . . 103
Maciej Urbaniak
Sustainable Supply Chain Management in the Perspective
of Sharing Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
Piotr Banaszyk and Anna Łupicka
Simulation Modeling and Analysis for Sustainable Supply Chains . . . . . 145
Roman Gumzej and Miroslava Rakovska
ix
x Contents
Identification of Logistics 4.0 Maturity Levels in Polish

Companies—Framework of the Model and Preliminary
Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
Aglaya Batz, Joanna Oleśków-Szłapka, Agnieszka Stachowiak,
Grzegorz Pawłowski and Katarzyna Maruszewska
Dynamic Organisation of Traffic Flows in the Transport Network
in Terms of Sustainable Mobility and the Development
of Industry 4.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177
Grzegorz Sierpiński and Ireneusz Celiński
Attractiveness of the Region in Connection with Intermodal
Transport Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197
Lilla Knop and Marzena Kramarz
Smart Glasses in Sustainable Manual Order Picking Systems . . . . . . . . 219
Brigita Gajšek and Nataša Vujica Herzog
Solutions Dedicated to Internal Logistics 4.0 . . . . . . . . . . . . . . . . . . . . . 243
Mariusz Kostrzewski, Pavol Varjan and Josef Gnap
Manager’s Maturity as a Derivative of Competencies and Dynamic
Capabilities—Vivisection in the Context of Industry 4.0 . . . . . . . . . . . . 263
Przemysław Niewiadomski, Natalia Pawlak and Anabela Carvalho Alves
Partner Sales Networks as Determinants of Road Maps
for the Development of the Telecommunications Industry
in Poland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 287
Łukasz Brzeziński, Piotr Cyplik and Magdalena K. Wyrwicka
Literature Review on Sustainable
Logistics and Sustainable Production
for Industry 4.0
Katarzyna Grzybowska and Anjali Awasthi
Abstract Sustainable Production and Sustainable Logistics has been discussed

extensively in the scientific literature. The objective of this chapter is to depict a
landscape of scientific literature on the concept of the Sustainable Production and
Sustainable Logistics. This concept in recent years is gaining more and more attention
from academics and practitioners. We identified a sample of 892 internationally pub-
lished papers and conducted a citation analysis to examine the connections between
the many scientific papers and to explore the most influential works.
Keywords Sustainability · Eco-logistics · Eco-production · Bibliometric

analysis · Eco-efficiency · Knowledge structure · Visualization of science
1 Introduction
Dynamic development of manufacturing Industry 4.0 is inevitable. In a globalized

world with highly interconnected processes, companies are facing an increasing
number of challenges to cope with (Hecklau et al. 2016). The approach of Indus-
try 4.0—the “Fourth Industrial Revolution”—may be also confirmed by reviewing
leading domains in publications (Gudanowska 2017; Lasi et al. 2014; Mrugalska and
Wyrwicka 2017; Stock and Seliger 2016). The discovery of new technologies has
escorted industry development from the early adoption of mechanical systems, to
support production processes, to today’s highly automated assembly lines, in order
to be responsive and adaptive to current dynamic market requirements and demands
(Lee et al. 2014). With these new integrated systems, it is possible for the factory of
the future to be adaptive with respect to the production of individualized products in
The study was financed by the research project no. 11/140/SBAD/4170.
K. Grzybowska (B)
Poznan University of Technology, Poznan, Poland
e-mail: [email protected]
A. Awasthi
Concordia University, CIISE – EV 7.636, Montreal, QC H3G 2W1, Canada
© Springer Nature Switzerland AG 2020 1

K. Grzybowska et al. (eds.), Sustainable Logistics and Production in Industry 4.0,
EcoProduction, https://doi.org/10.1007/978-3-030-33369-0_1
2 K. Grzybowska and A. Awasthi
small batch sizes. Automation will be increasingly important. The ‘Smart Factory’
constitutes a key feature of Industry 4.0, i.e., the Fourth Industrial Revolution (Drath
and Horch 2014). Factories become smarter, more efficient, safer and more environ-
mentally sustainable, thanks to the combination and integration of production tech-
nologies and devices, Information and Communication systems, data and services in
network infrastructures (Strozzi et al. 2017). Sustainability is playing an increasingly
significant role in planning and management within organizations (Grzybowska and
Kovács 2014).
A number of companies have proactively acted in favor of a more sustainable
development. Among those, a group also perceived the economical potential of envi-
ronmentally friendly logistic networks (Frota Neto et al. 2008). Sustainable logistics
network has attracted growing attention with the stringent pressures from environ-
mental and social requirements (Lee et al. 2010).
The following research questions were asked:
Question 1. To what extent does the idea under research concern individuals?
Question 2. Which researchers are the most influential figures in relation to the idea
under research?
Question 3. Which areas of knowledge concern the idea under research?
Question 4. Which research centers are leaders in terms of the idea under research?
Question 5. What have been the international research trends over the years?
Question 6. What are the most important conceptual clusters created on the historical–
graphical map of scientific publications, in the scope of the concept of Sustainable
Logistics and Sustainable Production, which were cataloged in WoS in 1980–2018?
This chapter is structured as follows. In Sect. 2 materials and methods are pre-
sented, while in Sect. 3 research methodology the results. In Sect. 4, the results of
the analysis. In Sect. 5, results are discussed and research directions are identified.
Final remarks conclude the chapter (Sect. 6).
2 Bibliometric Analysis
Bibliometric analysis is a dynamically developing method of evaluating research

results and comprehensively capturing scientific achievements. It allows you to
observe the development of science on a national and international scale. This analy-
sis uses information system tools that are used to comprehensively search for relevant
scientific publications. The bibliometric analysis focuses on scientific work, which
is often cited by other researchers over time and indexed in the largest databases
indexing scientific work. This is due to the fact that only these publications can be
considered as the basis for a given field or discipline. The reference of one researcher
to the knowledge of another scientist is interpreted as a phenomenon of diffusion of
knowledge.
Bibliometric analysis consists of the application and quantification of quantita-
tive data referring to scientific publications and the use of quantitative indicators
Literature Review on Sustainable Logistics and Sustainable … 3
of various databases. These indicators reflect the state of science or selected areas
(Marszakowa-Szajkiewicz 2009). She also adds that sometimes a large number
of citations of the indicated scientific work can be a determinant of a new idea,
method, or discovery. And a group of scientific publications often referred to by
other researchers in a given field or scientific specialty, can be treated as a concrete
carrier of its paradigm. In order to examine the structure, characteristics, as well
as the models underlying science and technology, both mathematical and statistical
techniques were used in the bibliometric analysis (Du et al. 2015). Bibliometric tech-
niques are often used by scientists, public institutions, and enterprises, but relatively
little known in Poland (Klincewicz et al. 2012).
Observation of scientific research in selected fields is practiced by scientists
around the world and is a key tool for managing knowledge diversity. Examples
include bibliometric analysis regarding the concept of supply chain sustainability
(Taticchi et al. 2013); research on flexibility (Seebacher and Winkler 2013); green
supply chains (Fahimnia et al. 2015); the Smart Factory concept (Strozzi et al. 2017);
considerations on reverse logistics (Wang et al. 2017); City Logistics (Kaur and
Awasthi 2018b); green supply chain management (Kaur and Awasthi 2018a).
3 Research Methodology
As a method of bibliometric analysis, the method of dynamic analysis of the literature

network (SLNA) was introduced by Colicchia and Strozzi (2012), which combines
a systematic literature review (Systematic Literature Review, SLR) and analysis and
visualization of the bibliographic network. The adoption of such an approach allows
the identification of trends in key issues that affect the development of knowledge in
a given field in a more scientific and objective manner than descriptive reviews that
are based on subjective criteria for selection of work and classification of research
contributions.
In the first phase, a Systematic Literature Review (SLR) is performed, and the
definition of the scope of the study is identified by means of three steps (Strozzi and
Colicchia 2012):
(1) Scope of the analysis.
(2) Locating studies ‘keywords, time, type of documents, language’.
(3) Study selection and evaluation.
In this chapter, the concepts of Sustainable Logistics and Sustainable Production
were studied. Sustainable logistics network research and practice have swung from
the search for win–win solutions to the search for solutions smartly compromising
business and the environment (Frota Neto et al. 2008). In a logistic network, a number
of actors will influence business costs and corresponding environmental impact.
Suppliers, manufacturers, consumers, logistics operators, as well as third parties
operating in testing, refurbishing, recycling, and energy production for the end-of-
life products are the main players. These players perform the majority of the activities
impacting business and the environment (Frota Neto et al. 2008, 2009).
4 Bibliometric Analysis
The search for scientific publications was carried out using the Core Collection of
Web of Science (WoS). This database provided by Clarivate Analytics earlier for
managing the platform was answered by Thomson Reuters). It is an interdisciplinary
(multidisciplinary) research platform that records the content of over 12,000 major
journals and over 160,000 conferences from around the world. It allows researchers
to search multiple databases simultaneously using a single interface—through the
Web of Science™ Core Collection. The WoS database provides many bibliometric
indicators and contains literature from most disciplines. This database includes a
number of databases and tools necessary to establish bibliometric indicators, para-
metric evaluation, and bibliography creation. It is also the most commonly used
database and citations for scientific purposes. An important advantage of the Web of
Science database is its transparency and organization. The Web of Science database
is one of the most coherent databases of scientific publications. Compared to the
Scopus database, Web of Science has a smaller range (Zhao and Strotmann 2015).
The main disadvantage of Scopus, however, is the quality of the data that is not
“clean”, like those from WoS. This means that some publications are not uniquely
identified. Therefore, the Web of Science database was used for research purposes.
It can be observed that the knowledge base related to research on sustainable
development is widely disseminated (Fig. 1). All the time we can observe a growing
trend of publishing scientific papers, which indicates that research is the focus of sci-
entists and researchers. Therefore, the current state of knowledge requires research
Fig. 1 Number of publications in the area of research on sustainable development from the Web
of Science database. Source Own study based on Web of Science
Table 1 Initial search results

A set of keywords Search results
Sustainability or Sustainable and Industry 4.0 243,802
Sustainable Production 4,126
Sustainable Logistics 112
Source Own study based on the Web of Science
to systematize and rationalize the knowledge generated on this subject. For this pur-
pose, it would be ideal to study the process of creating, transferring, and developing
knowledge from a dynamic perspective, to reveal its evolution in time.
In connection with the above, it was decided to narrow the subject of the under-
taken analysis. The aim of this chapter is to present the area of scientific literature
on the concept of sustainable logistics and sustainable production for Industry 4.0.
As a result of preliminary literature works, a set of keywords was selected that
will be used to collect metadata obtained from selected scientific databases. As a
result of this action, a set of concepts has been identified. The basic concept was
identified in the collection: “Industry 4.0” AND “Sustainability” AND “Sustainable
Logistics” OR “Sustainable Production”. Identification of keywords is a critical stage
of analysis. Its results may change if different keywords are used.
Finally, the search was conducted in January 2019 in the Web of Science database
using selected keywords. Scientific publications from the years 1980–2018 were
found, containing in its title, abstract, or words “Sustainable” or “Sustainability”.
Initial search for defined terms encompassed 328,910 literature items, without sup-
plementary words and identification of the type and type of publication.
Then the search was narrowed down to the set of key words indicated earlier.
Table 1 shows the search results.
The first publication for the concept of Sustainable Production was published
in 1987 by researcher R. Repetto entitled Economic incentives for sustainable
production. The author presents activities into sustainable patterns that preserve the
productivity of natural resource assets. Incentive problems now arise both from mar-
ket failures, such as externalities and common property problems, and from policy
failures, such as price distortions. The author indicates opportunities are available to
improve policies in ways that promote resource conservation, reduce environmen-
tal damage, and simultaneously raise economic productivity, decrease government
budget deficits, and ameliorate rural poverty.
Sustainable Logistics is a new area of research. The first publication for the con-
cept of Sustainable Logistics was published in 2004. This is a collective publication
under the title Environmental logistics for circular economy & eco-industry. In this
article on modem sustainable logistics, he presented the concept and connotation of
eco-industry and circular economy. Analyzed theories and key technologies of envi-
ronmental logistics in detail. Denoted that environmental logistics is the foundation
of the eco-industry and circular economy (Zhang et al. 2004).
The most frequently cited publication is Designing and evaluating sustainable
logistics networks by N. Frota, J. Quariguasi, J.M. Bloemhof-Ruwaard, A.E.E. van
Table 2 Scientific
Scientific publications in the years 1980–2018
publications in the years
1980–2018 Number of records = 892
The number of researchers = 2 846
Number of source titles = 626
Number of countries = 91
Number of scientific centers = 1,205
Nunen, and E. van Heck. The article applies redesign logistic networks in order to
mitigate negative environmental impacts. The objective in the design of logistics
networks has changed, therefore, from cost minimization only, to cost and environ-
mental impact minimization. In this paper, the authors reviewed the main activities
affecting environmental performance and cost-efficiency in logistic networks (Frota
Neto et al. 2008).
The scope of the search for scientific publications was reduced to four terms:
“Sustainability” OR “Sustainable” AND “Sustainable Logistics” OR “Sustainable
Production”. In total, 892 scientific publications were published in the years 1991–
2018.
As a result of the conducted activities, basic statistics regarding the created biblio-
metric database were presented (Table 2). A total of 892 scientific publications, com-
piled by 2,846 scientists, were collected for analysis. They were published jointly in
626 source titles—scientific magazines, conference materials, and monograph chap-
ters. The authors of the scientific publications identified and analyzed come from 91
countries and represent a total of 1215 units and research centers from around the
world.
After the analysis of the 892 papers, we were able to identify 626 scientific journals
(70%) and 205 conference volumes (23%) and 61 chapters from monograph books
(7%). All recorded citations refer to these sources. The journal with the largest num-
ber of published articles was the Journal Of Cleaner Production with 85 record
count, comprising 9.417% of all publications. The Journal of Cleaner Production is
an international, transdisciplinary journal focusing on Cleaner Production, Environ-
mental, and Sustainability research and practice. Sustainability has been identified as
the second most important scientific journal. Sustainability is an international, cross-
disciplinary, scholarly, peer-reviewed, and open-access journal of environmental,
cultural, economic, and social sustainability of human beings. It was cited 35 record
count or 3.924% of all publications (Table 3). It is evident that many articles were
published in only a small number of journals.
We analyzed a sample of 892 academic papers to identify articles with high impact
on the scientific research on “Sustainable Logistics” OR “Sustainable Production”.
The most important papers were cited more than two hundred times, all of them deal-
ing with research with the beginning up to the state-of-the-art of scientific research.
Table 4 presents an overview of the most influential scientific papers, starting with
high citation frequencies and ending with papers of low scientific impact.
Table 3 Top 10 most important scientific journals with the largest number of articles “Sustainable
Logistics” OR “Sustainable Production”
Source titles Record count % of 892 (%)
Journal of Cleaner Production 85 9.417
Sustainability 35 3.924
Acta Horticulturae 22 2.466
Journal of Manufacturing Technology Management 16 1.794
Procedia CIRP 10 1.121
Renewable Sustainable Energy Reviews 10 1.121
International Journal of Production Economics 9 0.991
Agronomy for Sustainable Development 8 0.897
Aquaculture 7 0.897
Ecological Indicators 7 0.897
Table 4 Most influential scientific papers

Publications Years Total citations
Expanding the utilization of sustainable plant products in aquafeeds: a 2007 804
review
By: Gatlin D.M.; Barrows F.T.; Brown P.; et al.
The biorefinery concept: Using biomass instead of oil for producing 2010 604
energy and chemicals
By: Cherubini F.
A literature and practice review to develop sustainable business model 2014 471
archetypes
By: Bocken N.M. P.; Short S.W.; Rana P.; et al.
Biotechnology—a sustainable alternative for chemical industry 2005 307
By: Gavrilescu M.; Chisti Y.
Constraints to commercialization of algal fuels 2013 274
By: Chisti Y.
The spread of Conservation Agriculture: justification, sustainability 2009 262
and uptake
By: Kassam A.; Friedrich T.; Shaxson F.; et al.
Nitrogen removal techniques in aquaculture for a sustainable 2007 256
production
By: Crab R.; Avnimelech Y.; Defoirdt T. et al.
Transitioning to sustainable production—Part I: application on 2010 216
machining technologies
By: Pusavec F.; Krajnik P.; Kopac J.
Towards sustainable production of biofuels from microalgae 2008 207
By: Patil V.; Khanh-Quang T.; Giselrod H.R.
Source Own study based on Web of Science
On the basis of the Web of Science database, the ranking of researchers can also be
distinguished, according to the number of scientific papers published by them indexed
by the database. Taking into account the authors and co-authors as well as the number
of their scientific publications, it should be emphasized that research into supply
chains, for the keywords “Sustainable Logistics” OR “Sustainable Production” was/is
dealt with by 2,846 scientists from around the world.
Due to the number of publications among researchers, attention is drawn primarily
to three whose scientific achievements include more than 5 scientific publications
from the studied area (Table 5). They constitute 0.05% of the researched population
of scientists. On the other hand, 2,646 scientists, which account for 93% of the
surveyed population, have in their output 1 scientific publication from the studied
area.
The results presented in Table 5 confirm the law of scientific productivity, com-
monly referred to as Lotka’s Law. It says that a small number of researchers publish
a large number of scientific papers, while most scholars can boast of a small number
of publications (Fig. 2).
Table 6 presents seven leading people of science, who most often published sci-
entific papers in the studied area. This group of researchers has published a total
of 32 scientific papers. Among the published works were three, which were elabo-
rated independently—A. Azapagic (1) and L. Hunt (2). Other scientific papers were
developed as co-authored works, in which three co-authors participated on average.
For the studied population of 892 identified scientific publications, statistics show
that the analyzed collection of scientific works is dominated by researchers from the
United States. It is a leadership that contributes significantly to the development of
the studied area. They have published a total of 128 scientific papers (Table 7). This
gives an indicator equal to 14.350%. In the second place, there is Germany with the
number of published works equal to 94 items.
The Web of Science database provides detailed insight into the types of knowledge
areas of selected scientific papers (Table 8). For the concept of Sustainable Logistics
and Sustainable Production, a total of 78 areas of knowledge were detailed, which
were then grouped. This shows that the subject is characterized by a multidisciplinary
specificity, which is related to the complementarity of issues and concepts from
different areas of science.
Table 5 Number of
Number of authors Number of published scientific papers
published scientific papers
1 6
2 5
4 4
37 3
156 2
2,646 1
This approach allows you to get a comprehensive approach to research. The ana-
lyzed area is also characterized by a wide range of studies; derives knowledge about
the methodology of research, methods, and tools from many sciences. The studied
area cannot be clearly subordinated to any of the sciences according to the classi-
fication of sciences. In the database, no scientific publication and scientific journal
about the “one-character” nature was found.
It should be noted that the total number of scientific papers corresponding to
particular areas of knowledge does not add up to the identified population of 892
scientific publications. It results from the possibility of qualifying the publication
simultaneously to several different fields and subfields of knowledge.
The developed statistics show that in the analyzed set of sophisticated scientific
works, four leading scientific institutions dominate. These are institutions whose
Fig. 2 Scientific productivity of researchers. Source Own study
Table 6 Most influential

Authors Record count % of 892 (%)
researchers
Pusavec F. 6 0.673
Kopac J. 5 0.561
Sala S. 5 0.561
Azapagic A. 4 0.448
De Boer I.J.M. 4 0.448
Forslund H. 4 0.448
Hunt L. 4 0.448
Table 7 Scientific
Countries/Regions Record count % of 892 (%)
contribution divided into
countries and geographic USA 128 14.350
regions Germany 94 10.538
Italy 76 8.520
Netherlands 72 8.072
England 71 7.960
Peoples Republic of China 48 5.381
Brazil 47 5.269
India 43 4.821
Spain 43 4.821
Australia 41 4.596
Table 8 The most popular

Research areas Record count % of 892 (%)
areas of knowledge for
identified scientific papers Engineering 262 29.372
Environmental Sciences 250 28.027
Ecology
Science Technology Other 208 23.318
Topics
Agriculture 187 20.964
Business Economics 95 10.650
Energy Fuels 65 7.287
Operations Research 53 5.942
Management Science
Computer Science 43 4.821
scientists published 8 and more scientific papers indexed in the Web of Science base
and were affiliated in a given scientific unit (Table 9). It was found that scientists
Table 9 The most popular organizations for identified scientific papers

Organizations Record count % of 892 (%)
Wageningen University & Research Centre, Netherlands 23 2.576
Ghent University, Belgium 13 1.456
Cornell University, USA 8 0.896
Utrecht University, Netherlands 8 0.896
Fig. 3 Comparison of selected scientific centers. Source Own study
from these distinguished scientific centers published a total of 52 scientific papers,

which is 5.83% of all published papers from the studied area.
A detailed analysis showed that among the four dominating research cen-
ters, two are located in the Netherlands. Two hundred academic papers affiliated
with Wageningen University & Research Center obtained h-index at level 8 (Fig. 3).
Thirteen scientific papers affiliated with Ghent University obtained h-index at level 6.
Eight scientific papers affiliated with Cornell University obtained h-index at level
4. The Utrecht University is noteworthy. Eight scientific papers affiliated with this
university received an h-index at level 7. It is a center aspiring to the leading.
The review of the dynamics of the number of published scientific papers from the
studied area in the years 1980–2018 allowed to identify three periods:
1. Activation period (1980–2006), in which 88 scientific publications were pub-
lished
2. Growth period (2007–2015), this period includes 425 scientific publications
3. Expansion period (2016–2018), this period covers 379 scientific papers.
5 Semantic Maps
The visualization of knowledge includes, among others, such issues as visualization

of the results of scientific research. It allows you to create excess value and extract
new knowledge from datasets. It also supports the process of creating new sources
of information (Motylińska 2014). The visualization is to provide a more effective

understanding of the data as well as the discovery of new facts and dependencies
that have been hidden so far. Taking into account the explosion of literature in recent
years, using digital tools to analyze disciplinary formation is not just a novel tool,
but a key tool (Flis and van Eck 2017, p. 7).
The use of analyses results in the creation of maps and science atlases. The use
of mapping and visualization opens up new research perspectives in the inter- and
transdisciplinary fields (Osińska 2012, p. 209). Thus, the analysis allows you to
explore the structure of science, or the field or discipline, and show its future trends.
The most commonly used unit for mapping or visualization of knowledge docu-
ments, understood as scientific works, patents, etc. Maps that visualize knowledge
are developed for various purposes. Examples include: mapping the evolution of
entrepreneurship as a field of research in 1990–2013 (Chandra 2018), analysis of
trends in the circular economy (Homrich et al. 2018), analysis of security culture
research (van Nunen et al. 2018).
As a result of the conducted works, semantic maps are created and subject to
analysis. They are based on keywords (Börner et al. 2005). Semantic maps are gen-
erated from various text sources, based on individual words extracted from scientific
papers, descriptive terms or descriptors assigned by the publisher provided by the
database provider (e.g., ISI keywords) (Börner et al. 2005). These maps are used to
understand the cognitive structure of the field (Salvador and López-Martínez 2000).
The so-called clusters are configured on the created knowledge maps. Clusters
are created using Cluster Analysis (CA). The result of cluster analysis is the division
of a finite set of objects into clusters (subsets). During the grouping, a set of clusters
is created (Jain and Dubes 1988).
As a result of cluster analysis, it is possible for
(1) identification of clusters by separating a group of similar objects that intensively
coexist and attempt to generalize their features
(2) designation of objects with isolated values that do not match other objects
(3) the discovery of the unexplored and unknown structure of the analyzed data.
VOSviewer version 1.6.9 was used for the job, which was released on August
29, 2018. The main advantage of VOSviewer, which decided about choosing this,
and not another IT tool, is the continuous process of updating the software functions
and a relatively easy way of using it. A special positive feature is that the program
focuses entirely on the visualization of bibliometric networks, and thus meets the
expectations of software.
The big advantage of VOSviewer is also the ability to map and create so-called
clusters using cluster analysis. To this end, the VOSviewer software uses the intelli-
gent local algorithm developed by Waltman et al. (2013). On the basis of the previous
bibliometric analysis and the obtained local database, a division into four periods
regarding the development of the concept was carried out:
1. activation period (1980–2006),
2. growth period (2007–2015), and
Fig. 4 Keywords for activation period. Source Own study
3. expansion period (2016–2018).

These periods were covered by the analysis and visualization discussed later.
5.1 Activation Period
For the analysis based on the keywords, the first period was chosen, the so-called
activation period. It belonged to 1980–2006. In this period, 88 scientific papers from
the studied area were published.
During this period, a total of 477 keywords were identified. Due to the fact that
the selection period concerns only 88 scientific publications for the purposes of
building a semantic map, the threshold for the minimal occurrence of keywords was
set, which is 3. Of the 477 keywords that relate to the identified work, 3 meet the set
requirements. These are: sustainability, economics, and management.
For the period under consideration, two clusters are specified, which is a scientific,
thematically coherent area. The first cluster contains two keywords: sustainability and
management. The second cluster contains one keyword: economics. Within clusters,
keywords are internally highly homogenous (Fig. 4).
The evolution of the studied approach began with keyword management, while at
the end of the analyzed period there is an expansion to the keywords: sustainability
and economics.
5.2 Growth Period
In the specified second period, called the growth period falling in the years 2007–
2015, 2,653 concepts have already been identified, of which 67 of them meet the
threshold of minimal occurrence of keywords, which was set at level 6.
In the analyzed period, 5 conceptual clusters (Fig. 5) were identified, related to
keywords. On the semantic map, the coexistence of keywords is clearly visible. The
Sustainability concepts are no longer relevant to the Management keyword, even
though they are in the same cluster. In contrast, Sustainability is relatively strongly
related to the concept of Sustainable Production, which is located in cluster 2. There
is also a relatively strong link to the concept of Sustainable Logistics.
Fig. 5 Keywords for growth period. Source Own study
All identified clusters are internally highly uniform and externally highly multi-
directional. In Table 10, the first two clusters with grouped keywords are presented.
It should be confirmed that the scientific structure of the studied area is radi-
cally changing. It results from the development of concepts and identified problems.
In the analyzed period, one can observe a growing interest in the concepts and prob-
lems: Sustainable Production and Sustainable Consumption; Sustainable Logistics
and Management; Sustainability and Environment; Environmental Management, and
others.
5.3 Expansion Period
In the third analyzed period, called the Expansion period falling in the years 2016–
2018, 2,533 keywords were identified, of which 72 met the minimum keyword occur-
rence threshold, which was set at level 6. The analyzed period contains, on average,
Table 10 Two important

Cluster 1 (17 items) Cluster 2 (15 items)
clusters for growth period
Design Aquaculture
Environment Brazil
Framework Cleaner production
Green chemistry Climate change
Impact Consumption
Life cycle assessment Efficiency
Logistics Energy
Management Food
Methodology Industry
Model Innovation
Optimization Policy
Performance Strategies
Supply chain management Sustainable consumption
Sustainability Sustainable production
Sustainable logistics Trade
System
Technology
Source Own study
the largest number of scientific publications on average. It should be noted that in

the analyzed 2-year period, the number of keywords increased radically.
Based on these identified terms, six conceptual clusters based on identified key-
words were specified for the period under consideration. Further changes can be
observed (Fig. 6).
The Sustainable Production keyword is given in cluster 2. In the third analyzed
period, the concept of Sustainability was assigned to cluster 3, which is less important.
The concepts of Management and Sustainable Logistics have been transferred to the 5
clusters. Sustainable Logistics is increasingly being replaced by another Sustainable
Supply Chain. Sustainable Supply Chain is the management of raw materials and
services from suppliers to manufacturer/service providers to customers and back
with the improvement of the social and environmental impacts explicitly considered
(Grzybowska 2012). This shows the continuous evolution of the research structure.
6 Conclusion
As a result of the research, international research trends for the period 1980–2018
were identified. They were carried out on the basis of identified scientific publications
included in the international Web of Science indexing database. On the basis of
Fig. 6 Keywords for expansion period. Source Own study
created semantic maps, one can observe the nonlinear development of concepts and
abrupt changes in thinking and conducting scientific research.
The aim of the visualization of knowledge regarding the concept of Sustainable
Production and Sustainable Logistics is to answer the following research questions:
(1) What are the international research trends over the years? (2) what are the most
important conceptual clusters created on the historiographic map of scientific publi-
cations in 1980–2018?
The main criticism of the study may be the fact that bibliometric analysis, the
effects of scientific productivity and citations cannot completely communicate about
the actual contribution of scientific work to the area under study. The choice of a
research database, which, despite being a large interdisciplinary and international
platform, covers only a fraction of the scientific publications available in the world.
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Evaluation of Key Skills Supporting
Industry 4.0—A Review of Literature
and Practice
Rupinder Kaur, Anjali Awasthi and Katarzyna Grzybowska
Abstract The proposed study evaluates the key skills needed to support Industry
4.0 from a literature review and practice perspective. A detailed review of literature
targeting the Industry and Education sectors is performed. Canadian manufacturing
and service industries and Polish automotive and pharmacy sectors are investigated.
Decision-making, leadership, team thinking, core skills, and general aptitude emerge
as the top skills needed in these sectors.
Keywords Education · Competence · Skills analysis · Workforce planning ·

Expert interview · Comparative analysis · Canada · Poland
1 Introduction
Enterprises have to react very quickly to challenges and opportunities in the busi-
ness world (Saniuk et al. 2014). The concept of Industry 4.0 was first used in 2011
at the Hannover Fair—an annual world-leading Fair of Technology and Industry in
Germany with the goal to collect recommendations for deploying strategic initia-
tives of “Industry 4.0” to ensure the future development of German manufacturing
industry (Vu 2018). Proposed on a European level, the catchword is “Factories of
the Future”, “Industrial Internet” in the USA and “Internet +” in China (Mrugal-
ska and Wyrwicka 2017). Industry 4.0 is the digitization of a company’s physical
assets and the company’s integration into digital ecosystems with its value chain
partners, from suppliers to customers. It uses smart technology and the use of real-
time data to increase flexibility, customization, efficiency, and productivity, and to
reduce time, costs, and innovation cycles. Due to disruptive technologies, the digi-
tization of processes, and explosive growth in data, Industry 4.0 will have a major
impact on the way products are designed, manufactured, assembled, shipped, and
R. Kaur · A. Awasthi (B)

Concordia University, CIISE – EV 7.636, Montreal, QC H3G 2W1, Canada
K. Grzybowska
20 R. Kaur et al.
repaired, and on the people that have to adapt to these changes. Industry 4.0 focuses
on nine technologies: autonomous robots, system integration, the internet of things
(IoT), simulation, additive manufacturing, cloud computing, augmented reality, big
data, and cybersecurity. Through these technologies, new supply chain paradigms
can be achieved, and production and related logistics processes will change. This
will require innovation on two fronts: smart products and smart processes. It will
also require substantial change to the workforce, which will need to be trained and
skilled to work in an Industry 4.0 environment; this is one of the biggest challenges
of the fourth industrial revolution.
Due to the implementation of new technologies, the employees need to be trained
for the latest and upcoming technologies to be an active member of the competitive
market (Kaur 2018).
Roux et al. (2017) revealed that with the introduction of new technologies and new
markets there will be an introduction of new job categories with the use of human
talent in a different direction. Ho and Frampton (2010) analyzed workforce suitability
in response to these technological changes. Lorenz et al. (2015) revealed that there
will be a 6 percent increase in employment but at the same time automation will
displace the low skilled laborers and there will be an increase in demand of employees
in software development and IT technologies. Hecklau et al. (2016) published that
with the introduction of new technology companies need to adopt new strategies
for the holistic development of human resource management. Barlat et al. (2008)
states that simultaneously determining the workforce allocation, i.e., the number of
workers with each skill set available during the planning horizon and the workforce
utilization or the sequence of tasks scheduled during the planning horizon to meet
customer demand is not a trivial task.
In this chapter, we present a detailed literature review on key skills supporting
Industry 4.0. Section 2 presents the workforce requirements based on Industry sector.
Section 3 covers the education sector. The Canadian and Polish perspectives are
presented in Sect. 4 and Sect. 5, respectively. Section 6 summarizes the results and
provides directions for future works.
2 Industry Sector
Importance of multi-skills for employees to work in Industry 4.0 has been recom-
mended by several authors (Sitek and Wikarek 2016; Nowakowski et al. 2019). These
include the ability to work in different business units, strategic thinking, computer
skills, core ability, general aptitude, leadership, culture protection, and security of
information. The key areas requiring skills will be ERP implementation, big data and
data analytics, cloud system and services, data and cybersecurity, and autonomous
manufacturing (Karre et al. 2017).
Gudanowska et al. (2018) identified four key categories of competencies
namely social, personal, managerial, and professional in the context of woodworks
Evaluation of Key Skills Supporting Industry 4.0 … 21
production, food processing, machine production, production of rubber and plas-

tic products, and metal works production sectors. Social competencies include
building relationships, knowledge sharing, and communication. Personal compe-
tencies include self-reliance, decision-making, troubleshooting, and innovativeness.
The managerial competencies include team building, leadership, strategic thinking,
project management, and team management. The professional competencies include
IT skills, technical skills, administering, negotiating, and knowledge of foreign lan-
guages.
Hecklau et al. (2016) conducted a competency gap analysis and proposed
employee readiness level for Industry 4.0. Four categories of required competencies
namely technical, methodological, social, and personal are reported. The technical
competencies include state-of-the-art knowledge, technical skills, process under-
standing, media skills, coding skills, and understanding IT security. The method-
ological competencies include creativity, entrepreneurial thinking, problem-solving,
conflict solving, decision making, analytical skills, research skills, and efficiency
orientation. The social competencies include intercultural skills, language skills,
communication skills, networking skills, ability to work in a team, ability to be com-
promising and cooperative, ability to transfer knowledge, and leadership skills. The
personal competencies include flexibility, ambiguity tolerance, motivation to learn,
ability to work under pressure, sustainable mindset, and compliance.
Gehrke et al. (2015) classify the qualifications and skills of workers in a factory
of the future into two broad categories: technical and personal. The must be require-
ments for technical Q&S include IT knowledge and abilities, data and information
processing and analytics, statistical knowledge, organizational and processual under-
standing, ability to interact with modern interfaces (human–machine/human–robot),
whereas for the personal Q&S, these are self and time management, adaptability and
ability to change, team working abilities, social skills, and communication skills.
Prifti et al. (2017) identified key competencies as communicating with peo-
ple, IT/Technology affinity, big data problem-solving, life-long learning, work in
interdisciplinary environments, network technology/M2M communication, model-
ing/programming, data/network security, business process management, collabora-
tion, teamwork, decision making, leadership skills, service orientation, creativity,
and self-management.
Grzybowska and Łupicka (2017) report the key skills for Industry 4.0 as creativ-
ity, entrepreneurial thinking, problem-solving, conflict solving, decision making,
analytical skills, research skills, and efficiency orientation.
Longo et al. (2017) advocate ERP implementation, big data and data analytics,
cloud system and services, data and cybersecurity, and autonomous manufacturing
as key areas requiring skills in Industry 4.0.
Karre et al. (2017) identified process mapping, statistical knowledge for problem-
solving, PL/SQL-advanced, and UML-advanced, maintenance and use of stored and
retained data, knowledge of servers, working with databases, virtualization and cloud
services, analytical and logic thinking, knowledge of security standards and com-
munication standards, off-line and online robot programming, installation of the
device into operation, and PLC programmer-machinery programming as the must-
have skills.
22 R. Kaur et al.
Benešová and Tupa (2017) recommend language skills, autonomy-responsibility-

flexibility-creativity-cooperation-communicativeness-reliability, ability and willing-
ness to learn new things, analytical/logic thinking, knowledge of security standards
and communication standards, knowledge of servers (level-administrator) for IT
jobs. For production jobs, manual skills, technical skills, language skills (English,
German, etc.,), autonomy, responsibility, creativity, knowledge of technical docu-
mentation, ability and willingness to learn new things, organized skills, cooperation,
media skills, and communication skills are needed.
Pfeiffer (2015) suggests that there will be demand for social media, data, next-
generation technology, and automation skills.
Janis and Alias (2017) recommend both technical and nontechnical competencies
for Industry 4.0. The technical skills involve state of the art knowledge, manufac-
turing, IT, computer science, and robotics and automation. The nontechnical skills
involve personal, social-human role, professional, and methodological competencies.
Arnold et al. (2016) identified requirements to face digital transformation as stan-
dardization, work organization, availability of products, new business models, know-
how protections, availability of skilled workers, research investment, professional
development, and legal frameworks.
Kinzel (2016) emphasized the importance of human factors in designing the
Industry 4.0 concept. No doubt, innovative technologies will be enhancing the use of
machines, but the role of the human factor cannot be ignored. Even for supervising
and technical maintenance of the machines we need labor force.
3 Education
Sackey and Bester (2016) looked into Industrial Engineering curriculum enhance-
ment initiatives for Industry 4.0. The key skills identified are data science and
advanced (big data) analytics, advanced simulation and virtual plant modeling, data
communication and networks and system automation, novel human–machine inter-
faces, digital-to-physical transfer technologies such as 3D printing, closed-loop inte-
grated product and process quality control/management systems, real-time inventory
and logistics optimization systems, and teaching and learning demonstration infras-
tructure.
Benešová et al. (2018) looked into education requirements for electronics man-
ufacturing within concept Industry 4.0 and identified that the cooperation between
schools and universities with companies will be very important for Education 4.0.
Currently, a lack of qualified employees is one of the highest risks for Industry
4.0 (Devedzic and Bari 2016). For this reason, the new technology trends (virtual
learning environment, learning factory or augmented reality) should be included in
education.
Vu (2018) proposed innovation of academic curriculum through CDIO
(Conceive, Design, Implement, Operate) methodology and standards for the Viet-
namese education sector.
Salah et al. (2019) emphasized on virtual reality based engineering education to

enhance manufacturing sustainability in Industry 4.0.
Stachová et al. (2019) highlight the importance of external partnerships in
employee education and development as the key to facing Industry 4.0 challenges.
These include employee training in external organizations, participation in training
courses, coaching and development programs provided by external specialists, staff
travel to partner organizations, cooperation with research institutions, cooperation
with secondary schools and universities, joint business activities with other activ-
ities (e.g., development, advertising, logistics), cooperation with competitors (e.g.,
partnerships in specific projects), a close link in the supply and demand chain, and
engagement in knowledge networks, alliances, and joint venture.
Azmi et al. (2018) found a lack of nontechnical skills among engineering students
in Malaysia. Communication skills especially in English, teamwork skills, critical
thinking and problem-solving skills, entrepreneur skills, and computer skills were
identified as key. Universities should expose their students with much more interdis-
ciplinary teaching, research, innovation, and valuable industrial training to meet the
current demands of industries.
Motyl et al. (2017) identify culture and education as the main keys to promoting
knowledge and awareness about industry 4.0.
4 Canadian Perspective
A survey study with 31 experts from manufacturing and service sectors was con-
ducted to seek their rankings on the following seven criteria:
Computer skills: This category involves skills related to computer proficiency such
as programming, robotics, decision support systems, software development, and
human–machine interface.
Soft skills: This category involves skills related to empathy and communication.
Multiskilling: This category involves knowledge of interdisciplinary skills, thereby
allowing workers to be multi-skilled and multitask in different environments.
Leadership: This category involves skills related to creativity and innovation, gen-
eration of new ideas and initiative taking.
Core skills: This category involves core or fundamental skills related to operations
engineering and management such as scheduling, resource allocation, and project
management.
Team thinking: This category involves skills related to working in teams such as
group coordination, conflict resolution, and consensus.
General aptitude: This category involves basic problem-solving skills such as prob-
lem identification, diagnostic, and repair.
The experts provided a rating of 1–10 where 1 refers to the least important and
10 refers to most important. Table 1 presents the results for the service sector. 18
24 R. Kaur et al.
Table 1 Study results from

Criteria Mean Std. dev
the service sector (Canadian
sector) Computer skills (C1) 8.028 1.311
Soft skills (C2) 8.222 1.734
Multiskilling (C3) 7.972 1.337
Leadership (C4) 8.528 1.355
Core skills (C5) 8.500 1.237
Team thinking (C6) 8.444 1.162
General aptitude (C7) 7.889 1.632

the manufacturing sector
(Canadian sector) Computer skills (C1) 7.231 2.619
Soft skills (C2) 7.769 2.278
Multiskilling (C3) 7.231 2.455
Leadership (C4) 8.000 2.549
Core skills (C5) 6.692 2.689
Team thinking (C6) 8.077 2.498
General aptitude (C7) 7.846 1.951
responses were received. It can be seen that Leadership (C4), Core skills (C5), and
Team thinking (C6) emerge as the top three skills.
Table 2 presents the results for the manufacturing sector. 13 responses were
received. It can be seen that Team thinking (C6), Leadership (C4), and General
aptitude (C7) are the top three skills.
Figure 1 presents the comparative analysis for the manufacturing and the service
sectors. It can be seen that the skills receive higher scores in service over the man-
ufacturing sector. The general aptitude (C7) scores equally for both sectors while
leadership (C4) received the major difference in scores. Leadership (C4) scored the
highest followed by Core skills (C5) in the service sector whereas in manufacturing
it was Ability to work in different business units (C3) and Soft skills (C2). In the
service sector, general aptitude (C7) scored the lowest whereas in manufacturing it
was computer skills (C1).
5 Polish Perspective
A questionnaire survey was conducted amongst 20 selected experts in the automo-

tive and pharmaceutical industries (Grzybowska and Łupicka 2017). These experts
are highly qualified managers employed in transnational companies. There were 10
experts in each industry sector, who filled in the questionnaire. Respondents were
asked to indicate their rankings on the following seven criteria (competencies):
Fig. 1 Industry 4.0 competencies comparative analysis (Canadian sector)
Creativity: is becoming a key focus area for employers looking for the twenty-first-
century employee. Creativity is characterized by the ability to perceive the world in
new ways, to find hidden patterns, to make connections between seemingly unrelated
phenomena, and to generate solutions. We are naturally creative and as we grow up
we learn to be uncreative. Creativity is a skill that can be developed.
Entrepreneurial thinking: skills refer to the ability to identify marketplace oppor-
tunities and discover the most appropriate ways and time to capitalize on them. It is
more like a state of mind that opens your eyes to new opportunities.
Solving problems: involves both analytical and creative skills. Analytical or logical
thinking includes skills such as comparing, evaluating and selecting. It provides a
logical framework for problem-solving. Creative thinking is a divergent process,
using the imagination to create a large range of ideas for solutions. Problem-solving
is an essential skill in the workplace and in personal situations.
Conflict solving: Resolving conflict is a key part of a manager’s role. Managing and
resolving conflict requires emotional maturity, self-control, and empathy. Resolving
conflict in a positive manner is a skill that can be developed and practiced.
Decision-making: is the process of making choices by identifying a decision, gather-
ing information, and assessing alternative resolutions. Decision-making is an integral
part of modern management. Essentially, rational or sound decision making is taken
as a primary function of management. According to the Oxford Advanced Learner’s
Dictionary, the term decision making means—the process of deciding about some-
thing important, especially in a group of people or in an organization.
26 R. Kaur et al.
Analytical skills: are the thought processes required to evaluate information effec-
tively. Analytical skills are the ability to visualize, gather information, articulate,
analyze, solve complex problems, and make decisions.
Research skills: can be from the need to be able to use reliable sources for continuous
learning in changing environments. Being able to provide in-depth information and
advice on a given topic is an important skill. Doing research in the world of work
is all about stepping back from your day-to-day work and looking at ways you can
improve. The most successful people tend to develop research skills early and use
them consistently.
Efficiency orientation: an ‘efficiency’ approach is one that stresses the efficient use
of resources as the main determinant of decision and action. Efficiency orientation
is inevitable.
The experts provided a rating of 1–10, where 1 refers to the least important and
10 refers to most important. Table 3 presents the results for the automotive sector. It
can be seen that entrepreneurial thinking (P2), decision-making (P5), and efficiency
orientation (P8) emerge as the top three skills.
Table 4 presents the results for the manufacturing sector. It can be seen that
decision-making (P5), problem-solving (P3), and conflict solving (P4) are the top
three skills.

the automotive sector
(Poland) Creativity (P1) 7.420 1.840
Entrepreneurial thinking (P2) 9.140 1.060
Problem-solving (P3) 8.500 1.420
Conflict solving (P4) 8.500 1.420
Decision-making (P5) 9.140 1.840
Analytical skills (P6) 8.260 0.700
Research skills (P7) 4.760 3.020
Efficiency orientation (P8) 9.000 1.060

the pharmacy sector (Poland)
Creativity (P1) 5.140 1.080
Entrepreneurial thinking (P2) 7.140 1.580
Problem-solving (P3) 9.720 0.760
Conflict solving (P4) 9.420 0.980
Decision-making (P5) 10.000 0.000
Analytical skills (P6) 8.280 1.800
Research skills (P7) 4.580 2.760
Efficiency orientation (P8) 8.860 1.060
Fig. 2 Industry 4.0 competencies (Polish sector)
Figure 2 presents the comparative analysis for the automotive and pharmacy sec-
tors. Knowledge becomes a key determinant of the development potential of enter-
prises (Grzybowska and Łupicka 2016). Employees with entrepreneurial thinking
skills stand out because they tend to think creatively and take ownership of their
jobs as well as performance. This is recognized by experts from the automotive
sector. Experts (practitioners) attach a very high value to competencies related to
decision-making. Such thinking probably arises from the view that the ability to
make optimal and effective decisions is the only way to increase efficiency and win
a strategic advantage (Grzybowska and Łupicka 2017).
6 Findings and Directions for Future Works
In this chapter, we conducted a detailed literature review on key competencies and

skills for Industry 4.0. Industry and Education sectors were investigated. Perspectives
from the Canadian manufacturing and service sector and Polish automotive and
pharmacy sectors are discussed. The results of our study yield decision making,
leadership, team thinking, core skills, and general aptitude as the top skills needed
in these sectors.
Directions for future work include the following:
• Extension of the current study with more data and across more sectors.
• Cross-sector comparison of key skills and competencies for Industry 4.0.
28 R. Kaur et al.
• Impact of various cultures on Industry 4.0 skills gaps.

• Identification of training programs for Workforce 4.0.
• Design and development of university programs for Education 4.0.
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The Role and Impact of Industry 4.0
on Business Models
Sandra Grabowska, Bożena Gajdzik and Sebastian Saniuk
Abstract Development of the concept Industry 4.0, dictated by the need to reverse
the downward trend in industrial production of European enterprises, forces modern
enterprises to adapt quickly and flexibly. These adaptations affect demand conditions,
production costs, and the search for new business solutions. The dynamic develop-
ment of industrial digitization and telecommunications technologies allows for bet-
ter integration of processes, machines, employees and individual products within the
framework of intelligent network structures. Industry 4.0 facilitates data collection
and analysis, evaluation of productivity and continuous improvement of processes.
The development of the Industry 4.0 concept was needed to develop new competitive
business models. These business models need to be based on cooperation and better
use of the available resources. As a result, enterprises could achieve a competitive
advantage through the personalization of products and low production costs. This
fourth industrial revolution affects the operational activity of enterprises and results
in new strategic thinking. The basis of new business models modified value chains
within the network of cooperating enterprises. Supply chains equipped with the latest
cyber–physical solutions ensure fast reorganization of logistics processes and a very
flexible adaptation of commercialization. These new forms of supply chains offer
the most personalized customer expectations. With the development of the Industry
4.0 concept, questions arise: what new forms will business models adopt? What will
the cooperation of enterprises that are inherently competitors be? What tools will
be able to support network cooperation of enterprises? The aim of this study is to
identify the challenges related to the adaptation of business models. The Industry
4.0 concept, includes issues such as reconfiguration of value chains, customization
and sharing resources in the network of companies operating under flexible supply
chains.
S. Grabowska (B) · B. Gajdzik

Silesian University of Technology, 40-019 Katowice, Poland
B. Gajdzik
S. Saniuk
University of Zielona Góra, 65-246 Zielona Góra, Poland

32 S. Grabowska et al.
Keywords Business models in Industry 4.0 · Value chain · Supply chain ·

Flexible · Sustainable development
1 Challenges for the Cooperation of Enterprises

in Industry 4.0
Strong competition and growing customer expectations in today’s markets mean

production efficiency and product customization. Product customization means that
the price should be close to the mass production cost. The Industry 4.0 concept
provides for a close relationship between these two factors, Industry 4.0 assumes a
fully integrated system with the suppliers, producers, and clients. This system forms
the Cyber–Physical Systems (CPS). CPS is an open socio-technical system com-
posed of communicating mechatronic products (machines, devices, robots, means of
transport, etc.). The issue of creating intelligent production plants (smart factories)
is associated with the use of digital transformation and intelligent robotics. Industry
4.0 is not only technological changes, but it is also changed in the business models,
strategic thinking and in value and supply chains. Dynamically changing the busi-
ness environment, the rapid development of new production technologies (CPPS—
Cyber–Physical Production System), intensity of the competition and globalization of
market present entrepreneurs with new and much more difficult conditions. (There-
fore, enterprises are planning to invest in cyber–physical systems in the future.) This
will also be reflected in the creation of new business models, which will allow for
a fast reorganization of processes and very flexible production (smart production)
(Saniuk and Saniuk 2018).
The logistics industry in Industry 4.0 (CPPS) is a system for collecting and
processing data in the area of the entire value chain, including the means of pro-
duction, storage systems, and suppliers’ networks. Information in the supply chain
is exchanged between CPPS elements through standardized communication inter-
faces, but it also becomes available globally, for human use in operational or mainte-
nance activities. CPPS systems are integrated, inter alia, in communication solutions
known as the Internet of Things (IoT) and the Internet of Services (IoS) (Ashton
2009). Modern supply chains are smart value chains, which are so flexible and inno-
vative that their participants provide customers with personalized value (Kaliczyńska
and Dabek 2015).
In new forms of business relations with digital resources, large amounts of data,
access to distance communication systems and the ability to build relationships within
the Internet of Things (IoT) and Services (IoS), new systems of cooperative value
chains are created. In relation to the value chain in terms of M. E. Porter, in which a
product or service moves in one dimension to subsequent organizational units (and
each adds value), new network realities are created in the new industrial reality, a
network of values, multidimensional structure, unlimited space and time, flexible,
mobile built for a specific customer (Kaliczyńska and Dabek 2015; Chui et al. 2010;
The Role and Impact of Industry 4.0 on Business Models 33
Clarke and Clegg 2000). The source of value is the combination of links of the net-
work, based on cooperation in the broad exchange of data, digitization, access to
cloud computing (computer), automation and robotization activities online customer
service and the availability of services shortening the order completion time to 24 h
or even shorter. The network systems are dominated by technical solutions belonging
to the physical world and the virtual world. There is an integration of Information
Technology (IT, office) and OT (operational and production) systems (Nanterme and
Daugherty 2017). IT systems in industry are used for logistics planning, customer
relationship management and support making key decisions about the way the com-
pany operates. Operational systems are used to monitor the operating conditions of
devices, to control the devices and to control processes. In modern business models,
there is a combination of these two worlds. This requires action in the form of the
modernization of technology and the realignment of digitization. The value chain
consists of a process, which is a set of activities and technology based on the tech-
nology used (Szymańska et al. 2017). The participants of the chain are characterized
by mutual trust. Communication in value chains of cooperating enterprises is carried
out without any time limit and from any place (Gajdzik and Grzybowska 2012).
2 Evolution of the Competitiveness of Enterprises in Terms

of CPS
Competition in the cyber–physical economy plays a significant role. Cyber–physical

systems (CPS) set the direction for the development of enterprises that strives to
be a smart factory. The continuous market competition of enterprises results in the
constant search for sources of competitive advantage and maintaining or improving
an existing position on the market. In the case of Industry 4.0, this source is CPS
(Sahay 2003).
Observing the competition processes in recent years, it has been noticed that enter-
prises richly equipped with the factors and means of production have a strong market
position. They build the competitiveness of companies in the industry or market seg-
ment. There is the competitiveness of economies, enterprises, and people (Afuah
and Tucci 2001; Grabowska 2016). The number of definitions proves the complex-
ity and ambiguity of the concept of competitiveness. Porter (1990b), analyzed the
concept of competitiveness in relation to national economies. Porter assumes com-
petitiveness is defined as productivity which is determined by factory conditions,
demand conditions, related and supporting industries, as well as regulations affect-
ing the creation, organization, and management of companies (Chui et al. 2010).
These skills are divided into two categories: operational competitiveness and system
competitiveness (Casson 1991; Grabowska and Furman 2015). The main indicator of
competitiveness is the results of foreign trade. Competitiveness is understood as the
ability to design, produce and sell goods whose prices, quality, technical and utility
values are more attractive than those offered by competitors (Teece 2010). Points
out the company’s distinctive abilities such as reputation, innovation, and enterprise
structure form the basis of the company’s competitiveness. In his concept of eco-
nomic development (Jabłoński 2019; Wirtz et al. 2016; Afuah 2004). These factors
are production and commercial solutions, or innovations (Afuah 2004) Prahalad and
Krishnan (2010) highlight concepts of key skills. For them, the competitive feature
is a set of human skills and the application of technology. The key feature of compet-
itiveness meets three criteria. Those criteria value for the client, differentiates from
the competitors and create opportunities to expand the market. In a different man-
ner and in a different approach, the competitive advantage is inseparably connected
with the company’s strategic model and with the business processes of the company
(Copeland et al. 1990). The competitive advantage is treated as the most important
conceptual dimension of the business model. It is the most important attribute. The
other elements constitute important sources of creation and maintenance in the model
or are perceived as factors of its application.
Nowadays, the intensification of competition in the industry is observed. By
observing the changes taking place at the Industry 4.0 level, there is a steady increase
in the importance of information resources in relation to material and financial
resources. The need to adapt business models in connection with a personalized
value for the customer and the development of cyber–physical production systems
is becoming a reality. Industry 4.0 introduces new areas of business competitive-
ness known as “smart”. Competitiveness in new business models includes modern
materials and personalized products manufactured by CPPS, giving a new quality to
products and services, accuracy, speed, precision, availability, individuality, conve-
nience, ease, flexibility, etc.
3 Industry 4.0 at the Core of New Business Models
The dynamic growth of competition, largely associated with the globalization of the
economy, makes it necessary to create a business concept that can meet the challenges
of Industry 4.0. Their theoretical detailing, and at the same time the application option
is the concepts of business models. Their characteristics are important because it is
an important element of the business processes being carried out, which constitute
value by satisfying the clients’ expectations. In Industry 4.0, it is particularly about
providing products that are maximally personalized while productively using the
resources of enterprises operating in flexible supply chain structures on the global
opportunity market.
3.1 Business Models—A Definitional Approach
Business models are a kind of philosophy of action which is treated as essential for
business development. The business models implemented by enterprises determine
the profitability and competitiveness of the organization (Porter 1990a, pp. 71–72).
Analyzing the essence, structure, and determinant helps to decide the shape and
types of strategic models which are important cognitive elements of the sphere of
development and functioning of enterprises. At the same time, such research may
serve to improve or build new business models that are necessary for the face of
economic, social, and technological changes (Porter 1996a, pp. 61–78).
In one of the most extensive and interesting works devoted to the construction of
business models, Afuah (2004, pp. 9–10) presents the business model of the company
as a set of activities, methods, and time to carry them out, using its resources to create
the highest value for the client and ensure a position to take on value. He states that
virtual innovations can be applied in all its elements and are necessary for creating
value for the client (Porter 2002, pp. 1–50).
The concept of a business model is closely related to processes, such as business
processes and business management. A business model is a tool containing a set of
elements and relationships between them, in a schematic way of presenting a business
idea (Porter 1996a, b). The model is a static description of the phenomenon through
its mathematical or descriptive mapping. Economic (business) models are considered
as a reflection of how to achieve the right economic results, expressed by the relation
of revenues, costs, and profit in the organization (enterprise) structures. Business
models correspond with performance models through the structure of the sector in
which enterprises operate and due to the intensity of competition and behavior of
enterprises, that is participants of the sector on the market in relation to competitors.
Business models are based on a strong combination of the strategy adopted by
the company with its implementation. Implementation of the strategy takes place by
building a value chain that ensures both the effective use of resources and skills as
well as their renewal. Partial innovations involve changes within the existing business
model. They express themselves in the creation of an advantage, e.g., in the area
of product quality, distribution network, sales network, research and development,
customer relations and production processes. In more detail, the elements of the
business model, as well as the interrelations between them and the construction of
the business model of enterprises in industry are shown in Fig. 1.
3.2 Competitiveness of M. E. Porter in Business Models
In a different way and in a different approach, competitive advantage is insepara-

bly connected with business models. Competitive advantage is treated as the most
important conceptual dimension of the model, is its attribute. The other elements of
it constitute important sources of its creation and maintenance in the model or are
perceived as factors of its application.
The achievements of Porter (2002), Saniuk and Saniuk (2018, Porter (1985),
Liker (1997) in the field of competitiveness are used to conceptualize business
models. It should be noted that the focus has been on the theoretical achieve-
ments, which concern the microeconomic view of enterprise competition. Therefore,
Fig. 1 The system of determinants of the business model in Industry 4.0
the example of a model determining national competitive advantages called the

“national advantage diamond” or “national competitive advantage diamond”, was
not considered. It is certainly worth presenting, even in a synthetic way, the views
of this author which directly concern shaping a competitive strategy and operational
efficiency. This model of the company’s activity ensures its economic success.
Presentation of Porter’s (1996a, b) views on this issue can begin with his thesis of
strategy and operational efficiency as conditions for obtaining the most important goal
of the enterprise. The most important goal is an economic success. This author states,
however, that each of these conditions (strategy and operational efficiency) have a
different impact on the achievement of this goal. The introduction of the issue, which
is an important issue for the transparency of the presented concept, is to distinguish
strategy and operational efficiency. Analysis of Porter’s (1985) views on strategy and
operational efficiency allows us to formulate useful guidelines for building business
models since the source of competitive advantages are all activities carried out by
the organization. Therefore, business models should include the following:
– typical activities (like their competitors),
– ways to modify those activities,
– different performance of such activities,
– activities other than competitors conducted exclusively by the given company.
An example of competition through the increase in operational efficiency is the
consolidation of sectors through mergers and acquisitions. In the era of Industry 4.0,
such thinking should be abandoned. The key indicator of the company’s success
will be the ability to cooperate with other entities. The decisive role in creating and
implementing an effective strategic model of a company is played by managers. In
the opinion of Porter (2002), they are too focused on improving operational efficiency
at the expense of the strategy. This situation, among other things, results from the
fact that the pursuit of operational efficiency is attractive. Operational efficiency
is specific and it can be based on actions leading to measurable improvement of
efficiency, which is required of managers. Operational efficiency programs, as stated
by the author, lead to immediate progress and higher, long-term profitability without
defining a strategy that may turn out unattainable for the company. Such a strategy
enables the company to achieve a lasting competitive advantage.
Assessment of the presented approach of Porter (1985), conducted in the aspect
of creating business models at the level of the fourth industrial revolution, should
start with the observation that an effective, long-term profitability business model of
an enterprise should be based on:
– a strategy to achieve sustainable competitive advantage,
– a management system that ensures operational efficiency.
Industry 4.0 is a big challenge for enterprises, but it also has huge prospects for
future development. Companies must completely change their strategy and over-
come many barriers. Initial research indicates that the most important barriers are as
follows:
– technical infrastructure—demand for machines and devices,
– automation of machines and devices and communication between them,
– cooperation with other companies—building relations and
– competences with other companies.
Elimination of these barriers (as shown in Fig. 2) will enable the joint production
of products in the network of companies creating smart factories in the future and
employees’ competences (the skills of employees needed to control an automated
production system) (Womack and Jones 2003).
Fig. 2 Key areas for building a competitive advantage in Industry 4.0

In each of these areas, strategic goals can be identified which must be implemented
in order to effectively implement the assumptions of the Industry 4.0 concept. Based
on preliminary pilot studies and literature analysis, a general implementation scheme
for the proposed concept can be built in network-oriented enterprises (Fig. 3).
A condition for the development of network forms of cooperation is the devel-
opment of a model of cooperation of companies creating future cyber–physical sys-
tems (CPS). The main task of CPS will be to ensure the collection, processing of
data required during physical flow processes taking place in the created network.
Unlimited network connections of intelligent mechatronic resources allow the human
role to be reduced to the supervisory and/or the coordinator function. The creating of
the network model requires the development of a number of conditions related to the
enterprise’s modus operandi in the production network. Particular attention should
be paid to the selection of partners oriented towards a joint production execution,
the manner of production flow planning within available resources and the financial
settlement of the partners providing resources for production. The selection of a part-
ner for the network functioning within the framework of the Industry 4.0 concept
Fig. 3 The integration model of enterprises oriented to cooperation with Industry 4.0
requires an initial assessment of the technological potential of partners, know-how,

employee competencies and the possibilities and skills of cooperation. This process
is also aimed at creating in the company the ability to reduce the technological gap to
the extent required by Industry 4.0. This technical gap reduction includes ensuring
the so-called technological readiness, which will allow for the creation of a com-
petitive advantage base (based on CPS) and to create within the managerial staff an
internal capacity to absorb and adapt innovation at the level of 4.0.
In the next stage, the company should decide to limit very high infrastructure costs,
in its area of specialization to provide for network cooperation. This will allow the
company to focus its attention only on those resources which guarantee a high level
of use and ensure the competitiveness of the company. The adoption of strategic
objectives oriented to the implementation of technology requires a further stage
related to the identification of needs and the determination of the required resources
and technologies capable of cooperating within CPS systems. The last stage is an
investment in the required resources and joining a common platform responsible
for receiving orders from the client and organizing temporary networks composed
of enterprises providing mechatronic resources for the needs of the platform. The
process of creating a network together with a prototype of computer implementation
is described in more detail in the work (Kuczyńska-Chałada and Furman 2018). The
platform is a tool facilitating the exchange of information between a broker who is
responsible for supervising the collection of data on a production order and offer(s)
from enterprises.
Data from enterprises will be automatically transferred to the platform from
machines and devices using the Internet of Things technology. Based on the infor-
mation gathered in the system, a set of network variants capable of timely order
completion is generated as well as a schedule showing the burden of individual
company resources in the selected option for the implementation of a new order.
Each variant is characterized by a set of selected enterprises with an indication of
the resources used, the cost of implementation and the date of commencement and
completion of the production order. Ultimately, this allows the individual company
to choose the best variant in the system and available resources to be reserved for the
production. Data on company resources is only provided to the broker. This means
that there is no access to confidential data from other companies, which increases
security against unfair competition. Each of the companies registered on the platform
has access to information about orders and planned tasks. In the modern industry,
a competitive advantage is built by enterprises that cooperate effectively with each
other. To this end, the company combines in a business ecosystem modeled on natural
networks. The mutual relations of entities, the use of shared resources and flexibility
allow for effective competition with large players in the global market. The strength
of companies in the network grows with an increase in the number of participants.
On this foundation, companies can build their modern business models.
4 The Value Chain of M. E. Porter in Industry 4.0
The existing system of connections within the value chain of M. E. Porter allowed
systematizing basic and auxiliary activities aimed at creating more value for the
client. The sum of the nine strategically important activities creates the added value
of the economic activity. The five basic activities are directly related to logistics,
production, and sales. The four auxiliary activities include management, financial
and personnel services, R&D, and procurement (Korena et al. 2015, pp. 64–71).
The first basic activity in M. Porter’s chain is entry logistics. Entry logistics is
related to supply. Raw materials and semi-finished products must be delivered to the
producer who uses them in the process of manufacturing products. The logistics for
supplying resources needed at the entrance to the production system are improved.
Manufacturers’ expectations at the developmental level of Industry 4.0 result in
increased flexibility of supply, greater diversification of forms of delivery and more
use of transport services using IoT. Time is of great importance. Delivery on time
reduces the costs of storage of raw materials as well as the storage of semi-finished
products on the production site (Bakkari and Khatory 2018). The resources go directly
to production, so the warehouse may be unnecessary. The solutions used in the
Japanese production systems (TPS—Toyota Production System) are still valid. At
the smart factory, they are verified quantitatively and qualitatively using computer-
IT control devices (Domingo Galindo 2016). Both raw materials and semi-finished
products must physically cross the gate of the plant and are delivered to the production
halls by autonomous vehicles, unmanned overhead cranes, conveyors, drones, etc.
During production operations, they are processed or assembled on cyber–physical
production lines (CPPS). Cyber–Physical Production Systems operate without the
participation of production workers. At the beginning of level 4.0, employees will
only be needed to monitor the process (Bauernhansl et al. 2014 ).
A new product is created. It is a highly personalized product. At the beginning
of entry logistics, the customer participates in product design. An intelligent chatbot
(robot at the level of trade assistants) can be virtual consultants who inspire the
customer to personalize the order and help in its realization by assigning individual
utility and non-use features of the products, e.g., aesthetic (Jones and LeBaron 2002).
Customers use sales platforms. Access to the sales platform is unlimited in time
and space. The commercial offer on remote systems is updated continuously. A per-
sonalized order is a package of information coded and assigned individually for each
ordered product (so-called product memory). In addition, manufacturers assign prod-
ucts to all necessary technical information in terms of production requirements. The
memory product communicates with cyber–physical production systems throughout
the course of the implementation using RFID technology (Gajdzik and Grzybowska
2012).
The output logistics process organizes the dispatch of goods according to orders.
So far, all these activities have been monitored by the Marketing and Sales Depart-
ment, which in practice is also called the Sales Department. At level 4.0, customer
service is unmanned as part of the mobile service and availability of sales plat-
forms (B2B). In the M.E. Porter value chain, the Sales Department was an extremely
important cell in the company because employees’ skills in acquiring and retain-
ing customers translate into orders placed. In Industry 4.0, business platforms and
sales platforms replace supply and sales cells. Access to online services eliminates
the need for access to employees dealing with customer service. Virtual advisors
advise in many industries, e.g., tourism, aviation, clothing, household appliances,
and pharmacology.
A common feature of the classic supply chain and its modifications at level 4.0 is
the pull-based process approach from the customer’s order to production (Gajdzik
2014; Kagermann et al. 2011). The difference is that the customer affects the charac-
teristics of the ordered product to a greater extent now. The individual processes are
followed by a total value orientation for the customer who is served online. Produc-
tion in Industry 4.0 is flexible and quickly changes to realize a new customer order,
which is another challenge for cyber–physical production systems.
The value chain in Industry 4.0 is varied in terms of products. Its participants
focus on the needs of a virtual client (supported by sales platforms). Satisfying
every customer’s need is a prerequisite for competitiveness in business models. The
individual orders carried out through personalized products create a set of serviced
clients that exceeds hundreds of millions (Mrugalska and Wyrwicka 2017, pp. 466–
473). The created set of satisfied individual customer needs is treated as a form of mass
individualization due to overcoming spatial, time, communication, technological,
cultural, financial barriers, etc.
The last basic activity in the classic value chain of Porter (2002) is an additional
service. The scope of these services is particularly significant and extensive since the
product must be adapted to the individual (imaginary) needs (expectations) of the
client. Access to services that enrich the value of products is implemented through
virtual service platforms as well as physical storage and service centers. In the value
chain, you can see integration with the environment, both IT and physical. IT inte-
gration is mainly about joining the logistics system with e-commerce systems. These
logistics systems ensure the ability to control the availability and purchase of goods
and devices communicating directly with each other via the internet. (This applies to
such concepts as the Internet of Things or M2M—Mobile To Mobile). Physical inte-
gration is primarily a streamlining of logistics processes, e.g., automatic loading and
unloading, fast stock replenishment in the warehouse, picking individual customer
orders and quick paths for picking processes (Krykavskyy and Mashchak 2017).
Resource flow management will be made easier by reflecting the movement of
products in the virtual supply chain (Bijańska et al. 2016, pp. 128–134). During
ancillary activities (support activities) within the value chain, several derogations
from the original M. E. Porter concept can be considered. Even Porter was tempted
to make a significant change (Grzybowska 2012).
Procurement previously implemented by the supply department in the enterprise
gives way to supply platforms, commodity exchanges, online auctions, etc. The
virtual nature of supply enters many types of raw materials and materials. It also takes
into consideration the supply relation to energy, water, gas, etc. However, it should be
emphasized that natural resource deposits are limited. The strong bargaining power
of suppliers and market availability will continue to apply traditional forms of supply
guaranteed by contracts that are negotiated between the supplier of raw materials and
the producer.
At the level of enterprise infrastructure and technology development, there will be
changes towards mobile automation and robotization in cyber–physical systems of
manufacturing and in unmanned warehouses with autonomous vehicles. In Industry
4.0, production processes are considered as innovative solutions in which production
(manufacture of products) is carried out using robots and industrial manipulators.
It also seems justified at the level of management to emphasize the importance of
the Maintenance Department, which will be replaced by learning devices, learn-
ing machines and the people who supervise them. The communication of solutions
between a human and machines will use the Internet and computer systems to support
production. Learning machines (machine learning) use the processing of current data
from cloud data (cloud computing) and learn to perform their tasks optimally with
the simultaneous calibration of adjustable operational parameters (Zhu et al. 2007;
Hamprecht 2006).
The level of human resource management will also be reduced. Its significance
will be lower in the value-level system at level 4.0. In Industry 4.0, due to the high
level of automation and robotization of activities, the demand for employees will
decrease. It will also be possible to eliminate many errors originating from a human
being, and which bring certain consequences for the efficient delivery of the product
to the market. At the same time, the demand for employees with competence in
handling information traffic between elements of the production process and the final
product will increase. The smart factory employs mainly IT specialists, automation
specialists, service staff, maintenance staff, cybernetics, and analysts. The basic tools
for increasing demands on human resources are creativity support tools (Gajdzik
2014).
The level of the company’s infrastructure according to the value chain of M. E.
Porter includes activities such as general management, planning, finances, accounting
and quality management (Porter 1996a, b). Planning and management activities will
continue to be implemented in the role of securing the course of basic activities.
However, their form and methods are changing. New names will appear, such as
digital business strategy, data-driven planning, and management. Gradually, new
business rules will be built between virtual organizations in connection with the use
of ICT in business management. The importance of monitoring, testing and analyzing
the course of operations, i.e., IoT, is growing in the smart factory. Figure 4 shows an
example of the IoT value chain.
With the development of Industry 4.0, the value chain will evolve due to the impact
of computer science, automation, and robotization on the course of basic and aux-
iliary processes. The share of individual auxiliary and support activities in creating
value for the client will change. The value is personalized and strongly individual-
ized. Therefore, the competitiveness of enterprises will be related to technological
capabilities in meeting customer requirements. The value chain will be subject to
Fig. 4 An example of an IoT value chain
configuration depending on the degree of adaptation of entities to the requirements

of Industry 4.0 participants. “Default”, wise technology (Baden-Filler and Haefliger
2017), occurs in production and logistics.
5 The Supply Chain in Industry 4.0
The process of controlling devices through Internet access goes beyond production.
This process includes means of transport, ordering systems and warehouses (material
control) within the supply chain (Womack and Jones 2003). Logistics implemented
under Industry 4.0 generates capabilities that allow effective implementation of the
tasks required for it in relation to a wide group of clients, contractors and other stake-
holder groups using the latest communication solutions in cyber–physical systems
(Kaliczyńska and Dabek 2015). Horizontal integration through value networks is a
term used in production, automation and IT and means the integration of various
IT systems used in various stages of production and planning, including the flow of
materials, energy, and information both within the company and on the outside in
value networks. In the Industry 4.0 concept, horizontal integration is based on dig-
itization where information flows in the network from the customer to the supplier
and vice versa. Product memory is essential for horizontal integration. Horizontal
integration includes both components of the value network within the company as
well as the network of subcontractors. The exchange of information concerns not
only the flow of goods but also data defining the reliability of deliveries and the
degree (level) of customer satisfaction (Krykavskyy and Mashchak 2017). Existing
trends of nowadays put new challenges to supply chain management.
Through the supply chain management, to improve the productivity of social,
environmental and economic activities of the company, the business is working for
itself and its stakeholders, and SSCM is an important factor in the growth of indica-
tors of all its participants. And, although the actions of the company, in accordance
with the principles of sustainable development, may have a higher initial cost, it
is important to take into account the entire life cycle of products and services. The
more energy-efficient and eco-friendly equipment and process the company has, the
smaller is its impact on the long-term operating costs. Enterprises and society must
develop common values. So, first of all, the supply chain managers must respond to
new challenges: to find suppliers who adhere to the principles of sustainable devel-
opment and to minimize the use of non-renewable resources with parallel limitation
of the company’s costs (Bijańska et al. 2016, pp. 128–134).
In the transformation of the supply chain to Industry 4.0 standards, an important
aspect will be its sustainable development. Sustainable supply chain management
(SSCM) is the management of the economic, social, and environmental impact of
the supplying process in the whole product life cycle to create, health and long-
term development of the economic, social and environmental value for all interested
parties in the process. According to SSCM, three groups of criteria are taken into the
account:
1. Economic criteria—fair conditions of contracts, timely adjustment of debts,
transparency in establishing business contacts between participants of the supply
chain, prevention of corruption.
2. Social criteria—fair practice in the field of employment (compliance with labor
laws and human rights, fair compensation to employees, adherence to the prin-
ciples of equality, concern for health and safety) and practice focused on coop-
eration with local communities.
3. Environmental criteria—the aspects of the environment that relate to the entire
product life cycle (design, transportation, use of raw materials for production,
recycling) (Zhu et al. 2007).
In the supply chain at level 4.0, as before, there is a requirement to quickly deliver
the product to the customer. Along with the increase in the speed of data flow and the
growing availability of commercial offers on the Internet, the emphasis on the pace of
deliveries is growing. With a high level of competition on the market, the struggle to
deliver product innovation to the market consists of accelerating the manufacturing
processes and logistics operations such as time compression. The customer can easily
search the Internet for alternative offers in terms of their speed of implementation.
Delivery of the goods within a short time from placing the order by the customer
is a development of the Just-in-Time delivery system (Hamprecht 2006). In the
1990s, the products delivered in a relatively short time to the customer were mostly
homogeneous and constituted the standard offer (ings) of the company. Industry 4.0,
offerings are personalized. The companies strive to shorten the delivery time from
the moment the order is placed by the customer to the maximum personalized order
delivery (Liker 2004). There are already companies appearing on the market which
are testing solutions based on deliveries within one hour of placing an order, e.g.
Amazon. However, this time compression applies only to certain regions with high
population density, such as Manhattan in New York City.
Apart from time compression, which in the supply chain at level 4.0
becomes stronger, an important feature describing changes in the supply chain
is the need to achieve a stronger and more positive synergy effect (Saniuk
and Saniuk 2017). Therefore, the effect of their interaction is greater than the
sum of the results of individual processes. The concept of “Smart Factory”
offers such a combination of machines that enables smooth synchronization of
the technological process. A positive example of the synergy effect is match-
ing the cyber–physical systems of individual participants in the supply chain.
Intelligent devices as referred to in Industry 4.0, communicate with each other and
transmit data to user management systems that have access to cloud computing.
Participants in the supply chain have access to cloud computing, which facilitates
their adaptation of supply and warehouse processes in combination with maintaining
inventories, production processes, distribution and supply to the customer’s person-
alized expectations (Moden 1998). The flow of information between all links in the
supply chain is optimized. Reconstruction of the interface between successive pro-
cesses to make the information run faster is a prerequisite for building a competitive
advantage.
The necessity of compatibility of system-computing solutions between individual
participants of the supply chain is also important. In order to ensure the flexibility of
the installation, IT systems must work seamlessly with the new network component
requirements for data transmission. New standards are created, which will be intro-
duced gradually, and will allow these two groups of solutions, e.g., Time-Sensitive
Networking, developed in IEEE by companies such as Cisco and Intel, to allow
synchronization of devices connected to one classic Ethernet network. This solution
will eliminate the need for using such industrial equivalents, such as Ethernet routers.
Using the new standard, it is possible to transmit data in industrial networks (IT) that
connect to office networks (OT) (Wicher et al. 2015, pp. 703–706).
Control and measurement solutions used in Industry 4.0 constantly analyze the
processes in terms of their efficiency and cost-effectiveness. These solutions elim-
inate unnecessary activities due to the purpose of operations, as well as time-
consuming and overly expensive operations. Therefore, activities that do not directly
create value for the recipient are the first to be eliminated. Cost analysis is a basic
process control panel in the aspect of eliminating “waste”. This is understood very
broadly as “muda” in Japanese. Data in the supply chain are special because they
are available in real time. By reliably reflecting the physical flows of resources in
the supply chain, the producer can increase the level of control over the processes
occurring in it. The use of IT technologies allows for the sharing of data at ware-
house sites, vehicle locations and other means of transport for partners in the supply
chain. IT technologies analyze data on an ongoing basis, eliminating unprofitable
operations at a given time and having a lower impact on the value for the recipient
than base operations (Franke 2001).
The value network (net of the value chain) as a new network structure was created
by the evolution of the M. E. Porter value chain. Porter’s concept, in which the product
or service moved one-dimensional to subsequent organizational units and each added
value, is multidimensional and flexible in the new industrial reality. The source of
value is the combination of network links, based on interoperability using business
platforms. Participants in the supply chain network participate in the expansion of
the data exchange network in real time. Technologies of wireless data transfer with
tags operating in the RFID (Radio-Frequency Identification) system enable control
of the location of the goods in the warehouse as well as control of the location during
transport. The dissemination of this technology is also associated with the anticipated
development of the Internet of Things (Liker 2004).
New chain structures enrich the relationships between participants by increas-
ing the coordination of activities using IT technology, increasing the precision of
implementation and shortening the production cycles of personalized products. The
common parts of the integrated supply chain in Industry 4.0 is access to IoT, the
virtual world of solutions. The basic and auxiliary activities typical of the chain
value of M. E. Porter imply an added value in the combined value chains (supplier
value chain, enterprise value chain, value chain of sales routes and value chain of
recipients). In the integrated industry, the term used for the form of the product line
using mobile automation solutions in many smart factories and integrated logistics
creates an integrated supply chain in which virtual connections override physical
connections (strategic alliances, capital links, etc.) (Tadejko 2015).
6 Summary
The chapter presents an introduction to the discussion of changing business models

in Industry 4.0. It is an attempt to answer the following questions: what new forms
will business models adopt? What will be the cooperation of companies that are
competitors by nature? What tools will be able to support the network cooperation
of enterprises? The publication does not present specific model solutions. It describes
the conditions that will be placed on business models in Industry 4.0. Industry 4.0
is a new concept of economic development which was initiated by the non-German
government in 2011. The first smart factories are projected to be operational around
2030. The current level of change can be defined as the adaptation of enterprises
to the new challenges posed by Industry 4.0. Enterprises are testing cyber–physical
production systems. The enterprises are also trying to understand how to control
these systems. From the perspective of adapting enterprises to the smart factory, the
independence of cyber–physical systems is assumed. Business models describing
cyber–physical smart businesses are being predicted to appear in a decade or two.
Currently, any attempt to copy a smart business is only an approximation of the
initiated changes which are not yet fully understood by everyone.
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Smart Industry—The Digital Gap
in the Process of the Smart Supply Chain
Competitive Advantage?
Katarzyna Nowicka
Abstract Smart Industry plays a crucial role in the system of smart supply chains.
Those kinds of supply chains are based on digital technologies ecosystems concen-
trated on supporting all types of flows to increase competitive advantage. Therefore,
decisions taken within a particular company concerning its innovations, technology
usage or B and R activities impact the whole level of value developed and deliv-
ered by the supply chains. The crucial role in the supply chain is played by small
and medium enterprises (SME) as their level of digitalization impacts on ability to
compete by smart supply chain idea. The aim of the chapter is to analyze the role
of digital technologies ecosystems usage by the Smart Industry sector—understood
as a part of the smart supply chain model—in gaining competitive advantage. The
special attention is put on SME as their role in the supply chain and economy is
vital. The main part of the analysis concentrates on the concept of Smart Industry
development in terms of its innovation and digitalization level in Poland. Analy-
sis is based on empirical researches conducted by Kantar Millward Brown among
Polish SME in 2017 and 2018 on behalf of the Siemens company and Ministry of
Entrepreneurship and Technology (in 2017—Ministry of Development) in Poland.
Additionally the reports on Industry 4.0 (Smart Industry) were revised and used for
research purposes.
Keywords Industry 4.0 · Technologies ecosystem · Smart supply chain · Digital

technologies · Ecosystems · Small and medium enterprises
1 Introduction
No discussion on the disruptive, uncertain or unpredictable economic environment

should take place any more. It’s a fact that surrounds the companies and their supply
chains from decades. Now the understanding of how these aspects could be omitted
or rather used as an opportunity by the company is a must. Digital technologies are
transforming all end to end steps in production and supply chain business models in
K. Nowicka (B)
SGH Warsaw School of Economics, Warsaw, Poland
52 K. Nowicka
most sectors of the economy to add more flexibility and efficiency to meet customers’
demand fluctuations. Today they play a basic role in gaining competitive advantages
not only from the perspective of a single company but mostly from the perspective
of the system they have been used for. This is mainly due to the features of these
technologies—or better the ecosystem they are element of—to support information
flow between the partners in the system—namely: the supply chain. Smart Industry
(or Industry 4.0) is a part of smart supply chains. It plays a crucial role in the system
as the producer and it is the main partner responsible for fulfilling the pipeline with
the products according to the information received on-line. Smarty Industry covers
the supply side in the smart supply chains warranting, i.e.:
– constant flow of the products according to the demands’ fluctuations,
– decreasing level of lost sales due to the lack of inventories,
– directly impacting the system flexibility in terms of supplying different combina-
tions of the products during its personalization process.
All of these assumptions covering the role of the Smart Industry’s impact on smart
supply chains’ competitive advantage. Therefore, understanding of being a part of the
system by the producers is one of the most important aspects heling them to identify
accurate technologies for the investments in the innovative technologies supporting
integration and information flow for value creation and delivery for the customers.
The aim of the chapter is to analyze the role of digital technology ecosystems
usage by the Smart Industry sector in gaining competitive advantage. In the second
chapter, the idea of Smart Industry (understood also as Industry 4.0) and its relation to
the smart supply chain is introduced. The IT ecosystem as a base for the introduction
of Smart Industry within the concept of smart (or digital) supply chains is the subject
of the third part of the study. The main part of the analysis concentrates on the Smart
Industry development in terms of its innovation and digitalization level in Poland.
Analysis is based on empirical researches conducted among Polish SME in 2017 and
2018 in cooperation with Siemens company and Ministry of Entrepreneurship and
Technology (in 2017—Ministry of Development) in Poland.
2 Smart Industry—The Phase in the Smart Supply Chain
Currently, the so-called fourth industrial revolution being today the broadly described
stage of socioeconomic development. The concept of Industry 4.0 (or Smart Industry)
has become its element. This revolution is connected with the following three phe-
nomena (Paprocki 2016):
– universal digitization and ensuring constant communication between people, peo-
ple with devices, and devices among themselves,
– increasing the implemented innovations of subversive character (disruptive inno-
vations), allowing for a stepwise increase in the efficiency of the socioeconomic
system,
– the development of machines capable of autonomous functioning through the use
of artificial intelligence.
Smart Industry—The Digital Gap in the Process … 53
Smart Industry, or Industry 4.0, is currently widely described in the scientific

literature and popular term used in the business world. It is defined as the application
of the cyber-physical systems (CPS) within industrial production systems, which can
be equivalent to what has been introduced as industrial internet by General Electric in
North America (Posada et al. 2015). However, Industry 4.0 can be better identified
based on its design principles and technology trends (Gilchrist 2016; Liao et al.
2017; Santos et al. 2017; Ustundag and Cevikcan 2017; Vogel-Heuser and Hess
2016; Grzybowska and Lupicka 2017). Also, the broader approach can be revised,.
i.e., German Federal Ministry of Economics and Energy (Bundesministerium Für
Wirtschaft Und Energie) (2015) introduced the idea of “Industry Platform 4.0” and
described as: “The term Industrial 4.0 stands for the fourth industrial revolution, a
new stage in the organization and management of the entire value chain over the
life cycle of products. This cycle addresses the increasingly individualized customer
requirements and extends from the idea of the development and manufacturing, the
delivery of a product to the customer up to the recycling, including Industry 4.0
associated services. The basis is the availability of all relevant information in real
time through the networking of all entities involved in the value creation as well as
the ability to derive from the data the optimal value flow at any time. By linking
people, objects and systems, dynamic, real time and self-organizing, cross-company
value-added networks emerge, which can be optimized according to different criteria
such as cost, availability, and resource consumption.” One can observe two main
aspects that are covered by this definition. One is that it is built on features of digital
technologies and the second is that it might be mainly dedicated to the big companies
that are able to implement the idea in the entire value chain. However, not only big
companies compete by the supply chains. And more—the technologies are getting
cheaper and diffused within the supply chains.
Therefore, it is interesting to analyze the Smart Industry idea acceptance within
SME. Especially that they play an important role in the economy. First of all because
they cover around 95% of the companies operating in Poland and 30% of them are
registered in the production sector (GUS 2018). The second point is that producers
are one of the most important nexus in supply chain as they used to have a strong
bargaining power even if they are not a big companies but only supplies big compa-
nies.
From the supply chain perspective, Smart Industry might be understood as one
of the nexuses in the network of information, products, and money flow. Accord-
ing to Christopher (2011) supply chain is “the network of organizations that are
involved, through upstream and downstream linkages, in the different processes and
activities that produce value in the form of products and services delivered to the
ultimate consumer”. The most important aspect when analyzing competitiveness of
the supply chains is the integration that allows taking and implementing strategic
decisions in the whole system. Integration becomes a vital factor for the effective
functioning of supply chains to meet the performance objectives like cost, respon-
siveness, serviceability, and agility. Stevens and Johnson (2016, p. 22) described
supply chain integration as “the alignment, linkage and coordination of people, pro-
cesses, information, knowledge, and strategies across the supply chain between all
54 K. Nowicka
points of contact and influence to facilitate the efficient and effective flows of mate-
rial, money, information, and knowledge in response to customer needs”. Today
those “alignment”, “linkage” and “coordination” can easily be supported by digital
technologies (Nowicka 2019) creating smart supply chains.
Smart supply chains are based on digital technologies (and thus are also called
“digital supply chains”—Michel (2017), Straub et al. (2004), The Center for Global
Enterprise (2016) have a set of characteristics which distinguish them for tradi-
tional—linear-based solutions (Nowicka 2016). These characteristics create systems
that are Wu et al. (2016):
– instrumented: information in the next generation supply chain is overwhelmingly
being machine-generated, for example, by sensors, RFID tags, meters, and many
others;
– interconnected: the entire supply chain, including business entities, and assets, IT
systems, products, and other smart objects are all connected in a smart supply
chain;
– intelligent: smart supply chains make large-scale optimal decisions to optimize
performance;
– automated: smart supply chains must automate much of its process flows by using
machines to replace other low-efficiency resources including labor;
– integrated: supply chain process integration involves collaboration across supply
chain stages, joint decision-making, common systems, and information sharing;
and
– innovative: innovation is the development of new values through solutions that
meet new requirements, inarticulate needs, or even existing needs in better ways.
The smart supply chain is a system that ensures full interoperability and which
uses the potential of technologies, namely the features of IoT, Cloud Computing,
3D printing, Big Data and big data analytics, artificial intelligence, and automation
or robotization. A vast range of these technologies is already impacting produc-
tion systems and supply chains. Combined and connected into the joint ecosystem,
these technologies will open up new opportunities for creating value across multiple
dimensions—across the competitive supply chains of the future. The ongoing digital
transformation of industries also brings new opportunities for innovative business
models. The majority of companies in the manufacturing sector (79.9%) and the
logistics industry (85.5%) see positive effects resulting from digital transformation
(Kersten et al. 2017).
Such an ecosystem of technologies and appropriate use of data analytics makes
it possible to take decisions in near real time of events taking place in the physical
world at various levels of the supply chain. This requires integration processes which
consist of Wang et al. (2016), PwC (2016):
– Vertical integration, which involves internal processes of a company, ranging from
design and purchase to customer and after-sales services;
– Horizontal integration, which takes into account collaboration with suppliers, cus-
tomers, and cooperators in the value chain.
3 The Technology Ecosystem—The Holy Grail in Gaining

on the Competitive Advantage?
According to the World Economic Forum (2017), there is a correlation between the
relevance of new technologies and the speed of implementation of novel business
model solutions. Change in current supply chains is driven by operating the new
technologies. Five key technologies, which are currently at different stages in terms of
level of readiness and adoption across industry sectors, are expected to significantly
impact supply chains, they are internet of things, artificial intelligence, advanced
robotics, enterprise wearables, and additive manufacturing. It must be underlined
that they cover solutions for all types of enterprises in the supply chain.
The internet of things (IoT) is the virtual interconnection of intelligent assets
and devices to achieve improved user experience and/or usability. The opportunities
will only grow with the growth of intelligent interconnected assets and devices in
the global supply chains. Connected devices ensure the availability of real time data,
enable the geographic distribution of operations and manufacturing, and result in
improvements in operational efficiency, processing time, and operating and manage-
ment costs for the whole system.
Artificial intelligence (AI) or self-learning systems is the collective term for
machines that replicate the cognitive abilities of human beings. Within the broader
technological landscape predictive maintenance in the cognitive era has the potential
to transform global production systems. Machine-generated insights will pave the
way for greater precision and accuracy. Physical assets replace low-skilled labor,
which requires investment in and upskilling of the existing workforce.
Advanced robotics is defined as devices that act largely or partially
autonomously, interact physically with people or their environment and are capa-
ble of modifying their behavior based on sensor data. Robotic innovations have been
used for recursive manufacturing processes. Robotics and automation technologies
result in shorter cycle times while achieving better floor space utilization and higher
levels of productivity.
Enterprise wearables are permanently switched on, interconnected computing
displays that are worn on the human body. Applications of enterprise wearables are
multifarious. Design augmentations and manufacturing processes are key areas of
use.
3D Printing (additive manufacturing) is the fully automated manufacturing pro-
cess of building three-dimensional objects from a digital blueprint or model. It paves
the way for new designs, manufacturing concepts, and logistical services. Additive
manufacturing is considered a disruptive technology that adds new diversity to prod-
ucts and manufacturing strategies while also creating opportunities for new business
models.
All the above technologies, as well as other introduced into the supply chain
according to its needs and specifics are integrated into the one system or the platform,
might be called the technology ecosystem (Berttram et al. 2017). The technology
ecosystem is an enabling ecosystem that covers IT architecture and interfaces as well
56 K. Nowicka
as digital technologies and drives or supports improvements and breakthroughs in the

smart supply chain. According to Desmet et al. (2017) “integrating a company’s IT
with third-party capabilities creates opportunities to capture substantial new sources
of value. But until IT expands to become technology ecosystem, the vast majority of
those opportunities will remain out of reach”.
That technology ecosystem should be understood as a developing process since
new technologies are arising and constantly impacting different aspects of manag-
ing the business and developing new supply chain business models. So the pointed
technologies are important now, but might not be so important for gaining compet-
itive advantages in the next decade or even years. This might be also an important
argument to consider implementation of technology solutions together with the most
important stakeholders—partners in the integrated supply chain since the decision
plays a strategic role for more than just one company.
4 Smart Industry—The Role of Digital Technology

in the Competitive Advantage of SME in Poland
As the idea of Smart Industry implementation can be the first step to develop smart
supply chains that are able to gain extraordinary competitive advantage, there is a
need to analyze the current status of the Smart Industry concept by understanding and
implementing within production companies. Thus, there were two surveys conducted
in Poland to diagnose recognition of Smart Industry concept within SME. Both of
them were carried out on representative sample of SME registered in the industrial
sector in Poland.
The survey of Smart Industry Polska (2018) was aimed at examining the motiva-
tion and barriers associated with the implementation of innovative technologies in
industrial enterprises belonging to the SME sector related to the Industry 4.0 revo-
lution. The study was carried out in April 2018 on behalf of Siemens Sp. z o.o. and
the Polish Ministry of Entrepreneurship and Technology (former Ministry of Devel-
opment). CATI telephone interviews were conducted on a nationwide sample of
200 companies from the industrial or production sector with the number of employ-
ees up to 250. The respondents were carrying out production activities in Poland,
i.e., having a factory or production plant operating in Poland. The sample included
micro, SME in the following sizes: N = 60—micro-companies (1–9 employees);
N = 90—small companies (10–49 employees); N = 50—medium-sized companies
(50–250 employees). The respondents in the study were decision makers/competent
informers, i.e., managers responsible for implementing innovations, new technolo-
gies or company development (directors, production or development managers or
managing directors/business owners). Results presented in this study are addition-
ally supported by the previous study’s results. The previous study was carried out
in March and April 2017 also by Kantar Millward Brown on behalf of Siemens Sp.
z o.o. and Ministry of Development. It was conducted on a nationwide sample of
SME from the industrial sector conducting manufacturing activities in Poland. The
representative sample size consisted of 251 SME (N = 76—micro-companies, N =
100—small companies, and N = 75—medium companies). As mentioned before
SME was chosen due to the fact that they cover about 95% of production companies
registered in Poland (Statistical Yearbook of Industry—Poland 2017).
First of all, companies were asked if they plan to implement the concept of Smart
Industry in their strategic activities now or in the near future. However, in 2018 60%
of entrepreneurs have not even heard of the Industry 4.0 concept. And only 15.5% of
enterprises included the idea of Industry 4.0 in their strategy (Smart Industry Polska
2018) (Fig. 1).
Among that 15.5 % of companies (30 out of 200 respondents) who have imple-
mented the concept of Industry 4.0 in their strategy or plan to do so within the next
three years, the factors having the most important impact on such a decision were
Fig. 1 Place of the Smart Industry in the companies’ strategy

58 K. Nowicka
diagnosed. As the most important determinants of such choices respondents included

the need to reduce production costs (35.5% of responses) and the need to obtain a
competitive advantage on the market (22.6%). The third very important factor was the
expectations of customers with regard to the increase in the quality of the products
offered, so the value proposition, (9.7%), and then the expectations of customers
with lower prices of products—this could also be understood as a value proposi-
tion—(6.5%) (Smart Industry Polska 2018). The indicated responses are among the
factors shaping the level of company’s competitiveness on the market (Fig. 2).
However, the low level of the Industry 4.0 (or Smart Industry) concept knowledge
is not synonymous with the nonuse of modern technologies by these companies.
SME in Poland uses different types of technologies and more than half of them use
automation of production lines and data analytics. About one-third uses software
helping to reduce costs of prototyping of new products and Internet of Things, 25%
use robotization of production lines and less than one-fifth use other digital tech-
nologies that are in particular shown in Fig. 3. All of them illustrate the ecosystem
of technologies used in Smart Industry in Poland in 2018.
The implementation of new solutions in running a business is usually accompanied
by the expectation of improving the competitive advantage of the company on the
market. Therefore, respondents were asked to indicate the impact of particular tech-
nologies that they use to build their market position. Based on the answers received,
other; 19.4%
the possibility of
receiving a the need to
subsidy; 3.2% reduce
production costs ;
35.5%
the need for

changing
busienss model;
3.2%
the expectations
of customers
with lower prices
of products; 6.5%
the need to
the expectations obtain a
of customers competitive
with regard to advantage on the
the increase in market; 22.6%
the quality of the
products offered ;
9.7%
Fig. 2 Determinants of Smart Industry concept implementation

Fig. 3 Ecosystem of technologies used by the SME in Poland in 2018
it can be stated that the technologies supporting the innovativeness of the enterprise,
of the greatest importance for building a competitive position, are the automation of
production lines (76% respondents admitted that this solution impact on competitive
advantage) and data analytics used to optimize production activities (67%). Indica-
tion of the important order of these technologies to the impact on competitiveness is
the same as the frequency of their application by entrepreneurs declared. At the same
time, it is interesting to indicate by the respondents the robotics of production lines
as a solution with a strong impact on the market position (in total 63% consider this
technology as affecting the competitive advantage) with a relatively small percentage
of companies using this solution (25% on average) (Smart Industry Polska 2018).
60 K. Nowicka
In addition, respondents were asked about the direct role of individual technology
solutions in improving the profitability of the company. The level of utilization of
particular technologies (ecosystem) by companies was compared with their opinions
regarding the impact of these technologies on their economic activities (Fig. 3).
This comparison might serve for in-depth analyses to diagnose the low level use of
technologies indicated as those whose impact on profitability is significant. From the
production side it might be important to study costs of robotization of production
lines introduction in the factory as the impact of this solution is rather high. The
other—however more specific for particular industry and product characteristics—is
3D printing. 3D printing, however, is a technology that strongly impacts on supply
chain business model that might be reconfigured or even reduced from intermediaries
for direct distribution and the connection remains only between producer–consumer.
The other important technology that impacts whole supply chain management is
Internet of Things that is used by one-third of the companies and has quite a high
impact on their profitability. Wider usage of this solution might bring even more value
when considering its other features as impact on time to market, level of inventory
turns or rate of replacing damaged products at the different levels of supply chain
product’s flow.
By pointing out in more detail areas of the impact of technological solutions in the
context of competitiveness, the respondents recognized the possibility of improving
the quality of products offered, increasing productivity or improving the efficiency of
resource use. By the application of digital technologies, 85% of respondents expect an
increase in production profitability and over 82% increase in revenues. These results
show the key role of technological solutions that they can play when competiing
by innovations.
Due to the innovative nature attributed to digital technologies, one could assume
that the research and development departments of production companies will play an
important role in the field of decision-making in these areas. However, it is not. The
percentage of indications for these departments as a decisive factor in the implemen-
tation of new technologies was slightly above 21%. In addition, 45% of enterprises do
not have such departments in their organizational structures (Smart Industry Polska
2018).
Additionally, the results of the study conducted in 2017 among a similar group
of respondents showed that 58.6% of companies implemented innovations over the
past year (Smart Industry Polska 2017). Most often they consisted of introducing a
completely new or significantly improved product or service (37.8%), i.e., they were
a product innovation. In the second place, they relied on the use of a completely new
or significantly improved method or technology of production or delivery (32.7%),
which was a process innovation. On average—in companies that introduced innova-
tions—it was not one isolated initiative. The larger the company, the more innovation
there was—on average from 1.52 in microenterprises to 1.7 in medium-sized compa-
nies (i.e., employing from 50 to 250 employees). Looking at the type and number of
digital technologies implemented recently by the SME in Poland one can conclude
that those results show that SME from industry sector are neither innovative within
their core business activities nor in terms of using digital technologies supporting
their role in smart supply chains. The opportunity given by the features of digital
technologies is not used yet.
5 Conclusions
Smart Industry started to be an important concept connected directly with the fourth
industrial revolution that changes not only business models of the corporation but
whole economy migrating its development in the direction of further servicization.
The most important driver for this migration is the digital technologies that started
to be broadly implemented by innovative companies and their followers. Digital
technologies are currently the basis for business model reconfiguration that leads
to leveraging competitive advantages. However, not a single technology is a reason
for solving problems with the competition and not even single company can win
the race. First there is a need to analyze the type of technologies in terms of their
features that in connection with the other technologies’ features could create the best
ecosystem that fits into the need of the company. The second important aspect is
that the company should be understood as a system—the connected network of the
companies that cooperates within the supply (value) chain to maximize competitive
advantage by integration of the flows in the end to end perspective (Grzybowska
et al. 2014; Awasthi et al. 2014). Thus, Smart Industry should be analyzed as a part
of the smart supply chain that cooperates in an integrated manner based on digital
technologies ecosystem and driven by customers’ demands fluctuations.
It is important to understand the role of SME in the supply chain. First of all, they
cover 95% of the companies which means that they are strong partners in each of the
supply chains supporting big companies and innovators. The second aspect is that the
weakest link testifies to the strength of the entire chain. Therefore, whenever there is
an idea to compete with new solutions, i.e., digital technologies it must be diagnosed
if the partners in the supply chain are ready to take the challenge and introduce new
solutions.
The idea of the Smart Industry is starting to gain importance also among enter-
prises located in Poland. Still, it is not a commonly known concept and included in
a strategic perspective for the development of micro and small and medium-sized
industrial enterprises. It is worth noting that among those for whom Industry 4.0 is a
strategic element of the market game, the main factors motivating this decision was
the need to reduce production costs and the need to gain a competitive advantage.
At the same time it should be underlined that SME in Poland uses different types
of digital technologies that support their ability to integrate (or even create) smart
supply chains. Respondents recognized even their impact on profitability. The results
might be a base for further studies on how the low-level innovation companies (also
not even supported by any research and development activities) could gain competi-
tive advantages by integrating different types of flows based on digital technologies
62 K. Nowicka
implementation or interconnection within their (smart) supply chains. The results

also show the potential to introduce smart supply chain ideas within big companies
as in most of the cases they also built their supply chains in cooperation with SME.
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Sustainable Supply Chains Versus Safety
and Resilience
Tomasz Nowakowski, George Scroubelos, Agnieszka Tubis,

Sylwia Werbińska-Wojciechowska and Maciej Chlebus
Abstract This chapter is focused on the investigation of the main concepts of supply
chain resilience, vulnerability, risk, and safety in relation to the supply chain sus-
tainability management. Moreover, the fundamental differences between these defi-
nitions are discussed. Thus, in the introduction section the authors discuss the main
definitions of sustainable supply chain management and define the main relations
between the investigated concepts. Later, the disruption event definition is explained.
In the third section, the literature review on supply chain resilience, vulnerability,
risk, and safety is given. The authors underline the main perspectives and contexts
of these concepts definitions. The performed state of the art gives the possibility to
define the main relations between these concepts and sustainable supply chain man-
agement. The case study conducted in the automotive company presents the main
classification of disruption events that can occur during the production processes
performance. The conducted analysis gives the possibility to highlight the necessity
of performing the multidimensional analysis performance in order to properly man-
age sustainable supply chain. The work ends up with conclusions and directions for
further research.
Keywords Supply chain management · Resilience engineering · Risk analysis ·

Hazard event
T. Nowakowski · A. Tubis (B) · S. Werbińska-Wojciechowska · M. Chlebus

Wroclaw University of Science and Technology, Wrocław, Poland
T. Nowakowski
S. Werbińska-Wojciechowska
M. Chlebus
G. Scroubelos
EFNMS H&S Committee, Athens, Greece

66 T. Nowakowski et al.
1 Introduction
Nowadays, globalization, challenging market, demand uncertainty, and recent eco-

nomic competitiveness cause that supply chains sustainability performance issues are
of immediate importance (Ansari and Kant 2017). The topic of sustainability in the
context of supply chain management has been discussed using a number of terms in
the literature. Based on this and following (Gulati et al. 2010) the term sustainability
is defined as a development that meets the needs of the present without compromising
the ability of future generations to meet their own needs. The business sustainability
is usually perceived in the context of creating resilient organizations through inte-
grated economic, social, and environmental systems (Bansal 2010). The author in
Wolf (2011) define the sustainable supply chain management (SSCM) as the degree
to which a manufacturer strategically collaborates with its supply chain partners and
collaboratively manages intra- and inter-organization processes for sustainability.
A different view is provided by the authors in (Closs et al. 2011), where SSCM
is defined as a reflection of the firm’s ability to plan for, mitigate, detect, respond,
and recover from potential global risks. The definition of sustainable supply chain
management based on life cycle approach implementation is given in (Haake and
Seuring 2009). The authors define the SSCM as the set of supply chain management
policies held, actions taken, and relationships formed in response to concerns related
to the natural environment and social issues with regard to the design, acquisition,
production, distribution, use, reuse, and disposal of the firm’s goods and services.
However, in the most commonly approach to SSCM, the sustainable development
of supply chains is usually comprehended in an economic, an environmental, and
a social dimension (Ciliberti et al. 2008; Font et al. 2008; Grzybowska et al. 2014;
Grzybowska and Lupicka 2017; Seurig 2013; Seurig and Muller 2008).
Taking one step further, requirements for successful SSCM implementation
include organizational culture, strategy, risk management, and transparency (Alexan-
der et al. 2014). As a result, meeting environmental and social standards along all
stages of the supply chain gives the possibility to assess the minimum sustainability
performance. Thus, there is made an assumption that logistic flows in many industries
strive to be lean, responsible, and agile (Svensson 2000).
However, in today’s uncertain environment, supply chains may be disrupted in
many ways in their daily operations. This situation takes place in all sectors of the
economy, regardless of the level of chain integration. The only difference is the type
of adverse events that should be subject to risk analysis prepared for the needs of
cooperating business participants. For this reason, it is currently difficult to effectively
manage the supply chain without regularly analyzing the existing hazard events and
implementing solutions aimed at risk management. This approach becomes particu-
larly important when we talk about supply chain management in accordance with the
concept of sustainable development. The performed risk assessment must be focused
in this case not only on the risks related to economic aspects that are the goal of the
business. In the center of attention of persons identifying adverse events, it is equally
important to study risks affecting the environment and people. The need to adapt the
Sustainable Supply Chains Versus Safety and Resilience 67
Fig. 1 The supply chain sustainability in relation to resilience, vulnerability, safety, and risk Source
Own contribution based on Ansari and Kant (2017), Quorri et al. (2018), Seurig and Muller (2008)
operation of supply chains in such an uncertain and volatile environment has caused
the need to formulate new characteristics, like vulnerability, safety, and resilience.
The main relations between these concepts are presented in Fig. 1.
Consequently, the aim of this paper is to present and discuss the main terms of
supply chain resilience, vulnerability, risk, and safety by giving some explanations
of the fundamental differences between the mentioned concepts. The authors also
focus on the main relations between the mentioned concepts and SSCM.
The structure of the paper is as follows: In the introduction section, the authors
present the main definitions of a sustainable supply chain and defines the main rela-
tions between the investigated concepts. In the next section, the disruption event def-
inition and its classification in terms of company’s performance level are explained.
In the third section, the literature review on supply chain resilience, vulnerability,
risk, and safety is given. The performed state of the art gives the possibility to define
the main relations between these concepts and SSCM. The case study conducted in
the chosen company from automotive industry is presented. The work ends up with
conclusions and directions for further research.
2 The Disruption Definition and Classification
Supply chain vulnerability, resilience, risk, and safety have become a field of research
over the past 15 years, and a number of definitions have been made (Berle et al. 2011;
Sheffi 2007). In order to properly explain these concepts, first the disruption definition
and disruption profile should be explained.
Any threat which could cause an interruption in the flow from raw material to
the end user is a supply chain risk and any interruption in the flow of material is a
supply chain disruption (Sapna Isotupa et al. 2014).
Disruptions can be divided into three categories to facilitate estimating their like-
lihood (Sheffi 2007): natural disasters, accidents (faults, failures), intentional attacks,
and the methods of estimating their likelihood are different.
Moreover, based on Chapman et al. (2002), Mascaritolo and Holcomb (2009),
Singhal et al. (2011), main supply chain disruptions may arise from such sources as:
• natural disasters, such as earthquakes, cyclones, epidemics,
• terrorist incidents,
• accidents, like the fire of supplier’s factory, or
• operational difficulties, connected, e.g., with variability in supply, demand uncer-
tainties, price variability.
Svensson in his work (2000) considers them in terms of analysis inbound logistic
vulnerability and divides them into direct and indirect sources of disturbance. More-
over, following Longo and Oren (2008), terrorist attacks, wars, politic problems or
natural disasters should be considered as risks external to the supply chains. Risks
related to processes and activities should be considered as internal to the company,
and risks coming from the market or from suppliers should be considered as external
to the company and internal to the supply chain.
When supply chain disruptions are defined in terms of unexpected events occur-
rence, they can be described as having uncertainty in logistic process operation
(Werbińska-Wojciechowska 2013). Uncertainty in the process is connected with def-
inition of perfect operation of logistic system and may be described by 7R formula:
Right product, Right quantity, Right quality, Right place, Right time, Right cus-
tomer, and Right price. Thus, different aspects are taken into consideration, such as
(Werbińska-Wojciechowska 2013):
• time (in the sense of duration of activity/process, starting/ending moment of
activity realization, frequency of activity/demand occurrence),
• quantity (of supply, demand or physical transfer of goods),
• location/place (where activity starts/ends),
• quality (of service/products),
• cost (fluctuation, occurrence).
However, not every disruption occurrence leads to a logistic system failure appear-
ance. The critical factor which determines the logistic system failures is time. In a
situation, when disruption (connected with, e.g., improper delivery quality/quantity,
improper location) occurs, there is a necessity to find out if we have enough time
to correct the problem. When the spare time lets us remove the disruption—logistic
system is not defined as failed. In other words, time redundant system has the ability
to tolerate interruptions in their basic function for a specific period of time without
having a negative impact on the system task performance.
Typically, the time redundant systems have a defined time resource that is larger
than the time needed to perform the system total task (Werbińska-Wojciechowska
2013). Time redundancy is to take additional time to complete the task (in relation
to the time necessary for its execution), which can be used to restore the state of the
system or improve its technical characteristics. This means that the system with time
resource tolerates faults with a short (usually specified) duration.
Any significant disruption will have a typical profile in terms of its effect on
company performance. The performance is measured by sales, production level,
profits, customer service or another relevant metric (Sheffi 2007).
Following this, in the next section, the main definitions and literature review on
the analyzed supply chain concepts are provided.
3 Resilience, Vulnerability, Risk, and Safety of Supply

Chains—Definitions and Literature Review
Currently, in the literature on resilience, vulnerability, risk, and safety of supply

chains one can find a lot of ideas, definitions, and methods that can be implemented
to manage sustainable supply chain (Sheffi 2006, 2007). Therefore, it is worth dis-
cussing each of these concepts separately in the first step.
3.1 Concept of Resilience of Supply Chains
The importance of supply chain resilience issues may be confirmed, e.g., by the
Supply Chain Resilience Reports in which the challenge of developing resilient
supply chains are considered since 2009 (Supply Chain Resilience reports 2009,
2010, 2011, 2012, 2013). The reports highlight the level, range, and cost of disruptions
that organizations face, and demonstrate how a disruption in one organization can
spread out over the entire supply chain (Supply Chain Resilience report 2013). One of
the most important key findings results from the last report (Supply Chain Resilience
report 2013), is that about 75% of respondents still do not have full visibility of their
supply chain disruption levels (survey of 579 respondents from 71 countries).
The concept of resilience is now widely analyzed in many research areas, such
as engineering, social sciences, and economics (Elleuch et al. 2016). Therefore, one
common definition of this concept cannot be presented for different technical systems
or organizations. The Online Compact Oxford Dictionary (2014) defined resilience as
the (a) ability to withstand or recover quickly from difficult conditions; (b) the ability
to recoil or spring back into shape after bending, stretching, or being compressed.
For example, in work (Fiksel 2006) resilience is defined as the ability of enterprises
to survive, adapt, and develop in the light of changes and uncertainty. For technical
systems, resilience generally means the ability to recover from some shock, insult, or
disturbance, the quality or state of being flexible (Bouchon 2006). Later, in Bukowski
and Feliks (2011) the definition of technical systems resilience was determined in
the context of readiness for safe and acceptable performance in abnormal (rare)
working conditions (e.g., disruptions, attacks, accidents, and catastrophe).
One of the articles devoted to the review of literature in the field of resilience engi-
neering (RE) is work (Patriarca et al. 2018), where the authors analyze publications
from a given scientific area from the period 2004–2016. Based on the assumptions
of the meta-analysis (Shafique 2013), the authors select 472 publications, including
articles from scientific journals, conference materials and chapters in books. They
focus on five studied scientific issues—the need for RE, RE for modeling, defining
and exploring RE, reflecting on RE, and RE managing and improvisation. In the next
paper (Nowakowski 2013a), the author discusses the concepts of vulnerability and
resilience and examines the relationship between these concepts, reliability, and risk.
A broad review of the literature in the area of defining the concept of resilience is
also presented in the works (Francis and Bekera 2014; Hosseini et al. 2016).
With regard to supply chains, the concept of resilience is defined in terms of—
their flexibility, agility, speed, transparency, and redundancy (see e.g., Creating a
Resilient Supply Chains: A practical Guide. Cranfield School of Management 2003).
In Ribeiro and Barbosa-Povoa (2018), the authors present a broad overview of the
definition of this concept in relation to four perspectives: focus event, performance
level, speed, and adaptive framing. The problem of supply chain resilience in the
context of risk management for the chain infrastructure and the ability to reconfigure
chain resources is discussed in detail in Ambulkar et al. (2015).
Some of the recent literature reviews in the field of supply chains resilience can be
found, among others, in the works (Briano et al. 2009; Brusset 2013; Carvalho et al.
2012; Chowdhury and Quaddus 2017; Christopher and Peck 2004; Haffenen et al.
2012; Kamalahmadi and Parast 2016; Longo and Oren 2008; Ponis 2012; Schoon
2005). On the other hand, in the work (Levalle and Nof 2017), the authors focus on
research on the resilience of logistics networks.
At the same time, Table 1 presents the chosen definitions of supply chain resilience
proposed in the literature.
3.2 Concept of Vulnerability of Supply Chains
Currently, there are a lot of works covering issues of vulnerability of technical sys-
tems (critical infrastructure, transport systems, etc.). At the same time, the term
vulnerability is defined in various ways, depending on the research area or research
methods used by the authors. In work (Schoon 2005) author identifies trend in the
definitions of vulnerability, resilience, and adaptation concepts, providing a short
Table 1 Chosen definitions of supply chain resilience

Sources Definitions
Berle et al. (2011) ‘the ability of the supply chain to handle a disruption without
significant impact on the ability to serve the supply chain
mission’
Christopher and Peck (2004) ‘is the ability of a system to return to its original state or move
to a new, more desirable state after being disturbed’
Jüttner and Maklan (2011) ‘the apparent ability of some supply chains to recover from
inevitable risk events more effectively than other’
Pereira et al. (2014) ‘the ability of the supply chain to react quickly to unexpected
events, to restore operations to the previous functional level,
and even to a new, better one’
Rice and Caniato (2003) ‘the ability to respond to unexpected disturbances and restore
normal operations of the supply network’
historical overview of their developments. Later, the author of the paper (Haimes
2006) analyzes the concept of vulnerability in the aspect of measuring and assessing
the risk of operating systems. In turn, the authors of the paper (Johansson and Hassel
2010) present three perspectives for the analysis of technical systems vulnerability—
an approach to assess vulnerability of global system threats, assess vulnerabilities
to system components, and examine the system in terms of geographic location of
its elements and its impact on the vulnerability level for threats. The proposed vul-
nerability assessment model has been implemented in the area of operation of the
electrified railway network. In the next work (Tixier et al. 2012) authors present
thirty-seven definitions of vulnerability term depending on the source and scientific
area. Moreover, in work (Nowakowski and Valis 2013) the author tries to specify
how to understand and define terms vulnerability, dependability, and risk. The state
of the art on vulnerability issues may be found also in, e.g., Nowakowski (2013a, b),
Nowakowski and Werbińska-Wojciechowska (2014), Nowakowski and Valis (2013),
Proag (2014), Restel (2015), Taylor and D’Este (2007), Valis et al. (2012).
The term supply chain vulnerability also has been studied and defined by
researchers in various ways. For example, supply chain vulnerability can be defined
as an exposure to serious disturbance, arising from risks within the supply chain as
well as risks external to the supply chain (Chapman et al. 2002). Svensson, one of
the most widely cited authors in this field, placed vulnerability and related concepts,
such as risk, uncertainty, and reliability, within the context of the wider concept of
contingency planning (Svensson 2002a, b, c). In his work (Svensson 2002a, b, c),
he defined vulnerability as the existence of random disturbances that lead to devi-
ations in the supply chain of components and materials from normal, expected or
planned schedules or activities, all of which cause negative effects or consequences
for the involved manufacturer and its subcontractors. This definition was the base
for developing a model consisting of three principal components, namely: source of
disturbance, category of disturbance, and type of logistics flow. Later, in Svensson
(2002a, b, c), author constructed the vulnerability consisting of the two components:
disturbance and the negative consequence of disturbance. This approach referred to

the focal firm’s inbound and outbound logistics flows and corresponded to the direct
source of disturbance in the model of vulnerability introduced in Svensson (2002a,
b, c). In the next work (Svensson 2002a), author investigated vulnerability consisted
of two components, namely time-dependence and relationship dependence, which
can occur in marketing channels. The higher the dependence the higher is the level
of perceived vulnerability. Following this, author in his next work (Svensson 2004)
based on the assumption that the gap between perceived dependence and perceived
trust influences, and has an impact on, companies’ perceived vulnerability in busi-
ness relationships towards suppliers and customers. The present research studies
are typically surveyed perceptions of supply chain-related risk in an organization’s
purchasing department or its first-tier supplier base.
To sum up, some of the researchers studied supply chain vulnerability, e.g., con-
ceptually (see, e.g., Peck 2006; Svensson 2000, 2002c), or mathematically (see, e.g.,
Aleksic et al. 2014; Bogataj and Bogataj 2007; Huang 2012). There are also some
works which are aimed at investigation of supply chain management issues in the
view of their vulnerability and resilience characteristics (see, e.g., Kurniawan and
Zailani 2010). Moreover, in the last 10 years there are few developed research works
presenting some empirical study for the concept definition, measurement, and inves-
tigation of the relationships between supply chain vulnerability and its performance
level (see, e.g., Svensson 2002a; Wagner and Neshat 2012) as well as the supply
chain risk management practices (see, e.g., Thun and Hoenig 2011).
Most of the known supply chain vulnerability definitions are consistent that this
concept in a multidisciplinary approach is determined by certain characteristics,
supply chain design variables, and environment (Wagner and Neshat 2012). Some
summary of vulnerability definitions in the context of supply chain performance was
presented, e.g., in works (Briano et al. 2009; Longo and Oren 2008; Nowakowski
2013a; Nowakowski and Werbińska-Wojciechowska 2014).
Moreover, it should be underlined, that several scientific research works on sup-
ply chain vulnerability were developed considering specific supply chain sectors
or technical systems. There were articles on supply chain risk/vulnerability, which
dealt with aspects of, e.g., maritime transportation system (see, e.g., Berle et al.
2011), transportation systems (see, e.g., Klibi and Martel 2012; Lupicka et al. 2018;
Walkowiak and Mazurkiewicz 2013), power systems (see, e.g., Hofmann et al. 2012),
or critical infrastructures (see, e.g., Kroger 2008; Zio and Kroger 2009).
Table 2 provides some recent definitions of supply chain vulnerability.
The nature of the disruption and the dynamics of the system response can be char-
acterized by the main eight phases presented, e.g., in Nowakowski and Werbińska-
Wojciechowska (2014). Key parameters of vulnerability are the stress to which a
system is exposed, its sensitivity, and its adaptive capacity (Adger 2006). When
reducing vulnerability, one reduces the likelihood of a disruption occurrence and
increases resilience. Thus, supply chain managers need to have the ability to mea-
sure and quantify the vulnerability of their supply chains (Wagner and Neshat 2012).
The main questions being involved in vulnerability assessment include: What can
go wrong? What is the likelihood of that happening? What are the consequences if
it does happen?
Table 2 Chosen definitions of supply chain vulnerability

Sources Definitions
Christopher and Peck (2004) ‘an exposure to serious disturbance, arising from risks within
the supply chain as well as risks external to the supply chain’
Jüttner et al. (2003) ‘the propensity of risk sources and risk drivers to outweigh risk
mitigating strategies, thus causing adverse supply chain
consequences’
Svensson (2002b) ‘condition that is caused by time and relationship dependencies
in a company’s business activities in supply chains. The degree
of vulnerability may be interpreted as proportional to the
degree of time and relationship dependencies and the negative
consequence of these dependencies, in a company’s business
activities towards suppliers and customers’
Wagner and Neshat (2012) ‘is a function of certain supply chain characteristics and that
the loss a firm incurs is a result of its supply chain vulnerability
to a given supply chain disruption’
3.3 Concept of Risk of Supply Chains
In the literature one can find many different definitions and meanings of the concept
of risk (Aven 2012; Hampel 2006), methods of its analysis and evaluation (e.g., Aven
2010; Brown and May 2003) and procedures for using the effects of risk analysis in
the decision-making processes carried out by managers. In colloquial language, the
risk is usually associated with the measure of hazard/threat, which is a consequence
of random events that are independent of us (Serafin 2013). According to the PN-ISO
31000 (2010) standard, risk is defined as the effect of uncertainty on objectives. The
development of this definition can be found, for example, in Aven (2016), where the
authors state that the existing definitions of risk express essentially the same idea,
adding the dimension of uncertainty to events that may occur and the consequences
that this entails. On the other hand, Wilson in his work (2005) defines the risk as an
assessment, significance, size, and essence of the loss, which may be the result of a
specific action, regardless of whether the action is initiated by the organization or
whether the organization is subject to its influence. In the frame of this definition,
risk is a measurable effect of uncertainty. A broader overview of the risk definition
can be found, among others, in the works (Aven 2012; Goerlandt and Montewka
2015).
The carried out literature review allows to state that the risk is a combination of the
probability of an event occurring with its consequences. The risk is closely related
to the uncertainty of the effects of a given action. The effects can have a serious
impact on the achievement of the objectives set for a given organizational unit. It is
important that the risk can take on two levels. This is due to the fact that the occurring
events are either negative with signifying a loss or positive with creating a certain
value.
Table 3 Chosen definitions of supply chain risk

Sources Definitions
Bogataj and Bogataj (2007) ‘potential variability of results that affect the decrease of
value-added in any activity in the supply chain’
Juttner et al. (2003) ‘any risks related to the flow of information, materials, and
products from sources of supply to the place of delivery of the
final product to the end user’
Zsidisin and Richie (2008) ‘the probability of occurrence of an incident related to the
delivery supply process resulting from the failure of a single
supplier or supply market, in which its results cause the inability
of a distribution company to meet customer requirements or pose
threats to the customer’s life and safety’
Currently, there is no single common definition for determining the concept of

supply chain risk or Supply Chain Risk Management (SCRM) (Sodhi et al. 2012). In
the literature, one can find works that define the concept of supply/delivery risk (e.g.,
Ellis et al. 2010) or supply chain risk (e.g., Bogataj and Bogataj 2007; Jüttner et al.
2003; Zsidisin and Richie 2008). The exemplary definitions are presented in Table 3.
These definitions usually refer to a specific area of the logistics chain performance,
the risk related to the implementation of information or material flows. In the paper
(Ho et al. 2015), the authors propose a more comprehensive definition of supply
chain risk as the probability and impact of unexpected events or conditions at the
macro and or micro level that negatively affect any part of the supply chain, leading
to operational, tactical or strategic failures.
An extensive review of the literature on supply chain risk is given in (Rao and
Goldsby 2009), where the authors classify existing literature on the typology of risk
sources, consisting of environmental factors, industry factors, organizational factors,
problem-specific factors and related to the decision-making process. This problem is
also continued, for example in Vilko and Hallikas (2012), where the authors map the
processes and structure of the multimodal marine supply chain and present the risk
classification framework in terms of the main risk factors. In addition, the authors
analyze the influence of risk in terms of delays occurring in the chain by Monte Carlo
simulations use. Moreover, the analysis of the issue of designing supply chains in the
aspect of the decision-making process affected by uncertainty and risk is presented in
the work (Ivanov et al. 2016). The paper presents a review of the literature analyzing
the possibilities of using selected quantitative methods in the aspect of analysis and
assessment of various types of risk as well as measures assessing the resilience of
chains.
To sum up, in order to prevent vulnerability, it is essential to manage risks in
chains through creating more resilient supply chains that are able to respond to
disruptions and adapt themselves to necessary changes (Christopher and Peck 2004).
Risk managing in supply chains is the function of supply chain risk management,
according to the definition presented, e.g., in Christopher and Peck (2004). More
information can be found, e.g., in Singhal et al. (2011), where authors provide a
comprehensive review and classification of supply chain risk management literature.

In addition, literature reviews in the area of risk management in supply chains can be
found, among others, in works (Ceryno et al. 2013; Ghadge et al. 2012; Qazi et al.
2015; Ouabouch and Paché 2014; Singhal et al. 2011).
3.4 Concept of Safety of Supply Chains
The last concept that needs comprehensive investigation is system/object safety.

The safety of objects/systems is a complex issue and should be considered in a
multidimensional sense (Huczek 2015). Therefore, many definitions of safety can be
found in the literature, depending on the research area in which the issue is addressed.
In the aspect of crisis management, the following are safe: an individual, a social
group, a nation, an institution, a state, when they do not feel threatened for their being
and their existence, are calm and confident in their interests, do not need someone
to look after them (Huczek 2015). In terms of system analysis, safety is captured in
two dimensions:
• as the property of an object characterizing its resilience to dangerous events
(threats),
• the system’s ability to protect internal values against external threats.
Thus, safety means the absence of critical/dangerous events while security is
focused on protecting system environment against the effects of these damages.
Safety is measured generally by risk—two-dimensional combination of probability
of an undesirable event and possibility of loss (consequences). Risk assessment
consists of the process of risk identification related to threat, includes its possibility
(likelihood or probability), impact, and consequences (Nowakowski and Werbińska-
Wojciechowska 2014).
After the attacks of September 11, 2001, safety issues in supply chains have gained
significant importance (Williams et al. 2008). Since then, the concept has been rapidly
developing in the context of risk management in supply chains (Williams et al. 2008).
One of the more frequently cited definitions of supply chain safety is that proposed
by Closs et al. (2004) (Table 4). This definition is multidimensional and refers to both
Table 4 Chosen definitions of supply chain security/safety

Sources Definitions
Closs et al. (2004) ‘managing supply chain safety means applying policies, procedures
and technologies to protect supply chain resources (products,
equipment, information, and personnel) against theft, damage or
terrorism and preventing the entry of smuggling and unauthorized
people or weapons of mass destruction into the supply chain’
ISO 28000:2007 (2007) ‘resilience to intentional unauthorized actions aimed at causing
damage or failure to the supply chain’
material and information flows, being carried out in the logistics chain. A similar
context of understanding the concept of supply chain safety is presented in Rice and
Caniato (2003), where the authors define three groups of tasks related to the safety of
supply chains including physical security, information security, and freight security.
Moreover, the author (Huczek 2015) defines the security of the logistic system as a
non-threaded state of logistic objects, connections (external and internal supplies), an
environment and users. The analysis and classification of the main threats to supply
chain safety are presented in Huczek (2015).
A detailed review of the literature from the studied research area can be found,
among others, in the works (Acciaro and Serra 2013; Colicchia and Strozzi 2012;
Gould et al. 2010; Williams et al. 2008). Table 4 presents examples of supply chain
safety definitions given in the recent literature.
4 Sustainable Supply Chains and Main Relations Between

the Concepts of Resilience, Vulnerability, Risk,
and Security
The concepts presented above form the basis for developing various vulnerability sce-
narios for supply chains. These scenarios have been discussed in more detail, among
others, in work (Nowakowski 2013b). In available models, global chain capability
focused on three elements (Kroger and Zio 2011):
• the degree of loss and damage as a result of the threat occurrence;
• the degree of exposure to hazards; vulnerability of the element to the risk of loss
and damage;
• the degree of resilience; the ability of the system to anticipate, deal with, absorb,
rebuild, and recover from the impact of a threat or disaster.
At the same time, the growing need to ensure safety and increase the resilience of
operating logistics systems to emerging threats has translated into the need to develop
standards that will allow standardization of the procedures conducted by participants
in supply chains in the area of risk management. There are currently various stan-
dards defining the ways of risk management. The most well-known standards include
COSO (corporate risk management—integrated framework structure); Risk manage-
ment standard FERMA—AIR-MIC/ALARM/IRM; Australian Standard AZ/ZNS
4360; Standard PN-ISO 31000: 2012 Risk management—principles and guidelines;
ISO 28000 standard—Safety management system in the supply chain.
Therefore, based on existing models of vulnerability (e.g., presented in Bouchon
2006; Kroger and Zio 2011; Scheffi and rice 2005), it is possible to determine the
basic relationships between the analyzed concepts (Fig. 2). The proposed in the Fig. 2
framework systematically integrates four major components (vulnerability analysis,
resilience measurement, risk management, and supply chain performance metrics)
in order to provide sustainable supply chain.
Fig. 2 Relationships occurring between the analyzed concepts in the aspect of supply chain oper-
ations—framework for creating a sustainable supply chain
The starting point for the development of SSCM is to identify, classify, and ana-
lyze the existing and possible to occur hazard events. During this phase, managers
should also group the defined disruptions (and classified according to vulnerability
theory) into three main areas—economic, environmental, and social. The obtained
results from vulnerability analysis are the basis for resilience measurement system
development and supply chain performance assessment. First, supply chain practi-
tioners should develop a supply chain and resilience management aims and scope,
including the definition of resilience policy or scope of measurement. They should:
• identify major performance processes and decompose them into sub-processes and
activities (the process decomposition can be performed according to the guidelines
given in, e.g., Chan and Qi 2003),
• set objectives with resilience and supply chain performance measures selection,
• aggregate individual metrics into one performance system,
• measure and track resilience and supply chain performance level,
• report results.
The obtained results are the base for risk management performance. The main
steps for the risk management process should be compatible with known standards,
mentioned above. The results in the form of guidelines, risk assessment, risk scenarios
are implemented into supply chain sustainability strategy.
After this process is finished for the focal company, the same processes can be
repeated for other supply chain members to identify sustainability goals, policy, and
measures for the inter-organizational processes performed.
Although this framework does not provide specific sustainability solutions (e.g.,
metrics), it should be used as a guide on how and what needs to be done to pro-
vide/create sustainable supply chain with taking into account uncertain performance
conditions.
5 Case Study
The problem of hazard events supervising and managing is presented in the case of a
production company from automotive industry. The analyzed production company is
focused on the production of automotive parts, which are mostly elements of trucks.
The offered products are designed to provide adequate protection for the driver
and improve his control over the vehicle being driven. In addition, the introduced
technological novelties are used by the company’s customers for the production
of trailers, coaches, and roadsters. Increased driver control is ensured, inter alia, by
improving the braking system, innovation in the area of gear changes and suspension
improvement. The company is constantly developing newer technologies that are to
further improve the driving experience.
The company currently cooperates with over 500 foreign and local deliveries
of components. The company offers more than 4000 products that are delivered to
customers. The company’s headquarter is located in Europe. The facility described
at the Chapter is located in Poland, in the Lower Silesia Voivodship.
In the described enterprise are two main production halls. There are six depart-
ments in the company: there are two departments in hall no. 1, and four sections
in hall no. 2, which deals with the production of, among others, main and auxiliary
valves. The department described in the work is located in hall no. 1 and is the largest
department in the company. It has over 40 production lines and occupies about 1/3
of the entire production hall.
The plant produces large-scale products. This is mainly the assembly of com-
ponents that are delivered. On the production line, operators in specific positions
deal with the assembly according to a specific instruction and production plan that
is currently in force on the line. Then the product is tested. The next stage is quality
control, later the product is packaged according to the packing plan prepared for
this product. Each product is packed in a plastic bag, then goes to the carton, where
it is separated by spacers. The package contains a specific number of layers of the
product. The production is organized according to three-shift work.
The production process is presented in Fig. 3.
Fig. 3 The main steps of the analyzed company’s production process

The operational performance of production processes is possible due to the effi-

cient operation of the IT system. It is used, among others, for ordering components
from the supplier and Kanban parts, verifying Kanban tables, verifying parts in
the factory and their availability in the warehouse, as well as verifying Kanban
movements. In addition, the analyzed case company uses the Just In Time system
supported by Kanban cards to ensure the right flow of materials, without the need
for stockpiling.
Moreover, in the enterprise, great attention is paid to the evaluation of the effec-
tiveness of the processes carried out through the prism of emerging disturbances. Of
particular importance are the problems appearing on production and their impact on
the level of so-called Lost Time management index.
Currently, there are defined 16 types of so-called disturbances that mostly regard
to social and environment factors:
1. Production break (unscheduled and scheduled breaks during the working shift)
2. Meetings (meetings of production workers)
3. PM1 (Preventive maintenance action performance)
4. 5S (all actions connected with 5S implementation and maintenance)
5. Conversion (all production plants conversions during the working shift)
6. Failure events (instrumentation)
7. Failure events (tester)
8. Lack of parts (due to quality)
9. Lack of parts (due to logistics)
10. Training
11. Settings/regulations
12. The line is taken by an engineer
13. Error analysis
14. The accuracy and lubrication of parts
15. Measurement of moments
16. Others
The exemplary results showing the level of time loses in the company for 2018
(for working weeks 1–44) for the selected production line of division no. 1 are given
in Fig. 4. Figure. 5 presents the details of production lost time in 35 weeks of 2018
according to the selected group of hazard events occurrence.
Monitored disturbances presented in the form of such defined indicators do
not allow to identify the source of the threat in a direct way. At the time of major
delays caused by the occurrence of a given disturbance, managers are forced to
undertake additional analyses examining the actual reasons for its occurrence. An
example can be a disturbance no. 9. The source of the unwanted events can be an
IT system, an employee of the logistics department or a supplier. For each of these
defined reasons, the manager managing the process can react in various ways. The
introduction of hazard assessment indicators at such a high level of generality does not
allow to monitor the effectiveness of the improvement actions undertaken. Changes
in the purchasing process at a given supplier, aimed at improving the timeliness
and completeness of deliveries, may mean the implementation of new solutions.
Fig. 4 The lost time level (%) for the chosen production line in the division no. 1 during the 44
working weeks of 2018 of the selected production company
Fig. 5 The lost time (in minutes) in the 35 weeks of 2018 in the production company—Pareto
diagram for the defined groups of disturbances
These new solutions in the first months of operation may generate errors caused by
the employee of the logistics department, which will affect further occurrence of
missing materials on production. In this way, the assessment of the effectiveness of
the implemented solution may be incorrect.
Such a defined risk measurement system may also lead to erroneous inferences. If
the occurring delays result from the occurrence of the event no. 2 or no. 10, managers
may limit the number of meetings and trainings in order to reduce the occurring
delays. Such action is in contradiction with the concept of sustainable development.
Both meetings and trainings have a developmental character and influence the quality,
safety, and comfort of the team’s work.
It should also be noted that not all events defined by the company as a disturbance
are negative. Their occurrence may decide about occupational health and safety
provision (e.g., event no. 3 or 4) and, in this way, they should not be limited.
In the frame of the concept of sustainable development, the company should,
therefore, significantly modify the scope of monitored disturbances in the production
process, which would be aimed at improving the process, taking into account social
and environmental aspects, not only economic in terms of time delays.
6 Summary and Conclusions for Research Work
When assessing the risk for logistic processes performed in accordance with the
concept of sustainable development, managers should monitor not only events that
introduce delays in production, but above all they should analyze adverse events that
affect the safety of employees, the environment and the economic stability of the
enterprise. Numerous concepts of safety, resilience, and risk in supply chains can be
found in the literature. However, there is a lack of a structured set of measures and
indicators aimed at measuring risks specific to individual sectors of the economy
and taking into account sustainable development. Examples of solutions used in the
surveyed enterprises indicate that also managers see the problem related to the mea-
surements being carried out, which do not correspond to the concept of sustainable
development. However, they point out in interviews that they lack access to good
practices that they could use in their processes performance. The development of a
performance measurement system based on literature studies, guidelines of Euro-
pean organizations operating in the area of sustainable development (e.g., OSHE)
and case studies from enterprises representing various sectors of the economy could
provide solutions for enterprises operating under specific market conditions. Thanks
to this, managers could use the developed solutions that would adapt flexibly to the
needs of the processes they manage. The development of such a system, taking into
account the specificity of the industry, will be the subject of further research carried
out by the authors.
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Digitalization of Supply Chain
Transparency: The Case of ChainReact
Łukasz Jonak, Agata Rudnicka and Renata Włoch
Abstract Industry 4.0 revolves around digital augmentation of production pro-

cesses—from design to utilization. It promises new business models, business–cus-
tomer relationships, product innovations, but also unprecedented transparency and
control, translating into new levels of sustainability in various areas (environmen-
tal impact of production, human rights in supply chains, etc.). The current vision,
derived from technological advances in big data, cloud computing, IoT, distributed
ledgers, suggests that the satisfactory levels of sustainability will emerge almost
“magically”, by the sheer concentration of transparency and reporting capable tech-
nical solutions. The case of WikiRate.org, and its ChainReact program, nuances
these assumptions. First, it demonstrates that technology can be used already to
promote business social responsibility without the full Industry 4.0 in place. Even
more importantly, it shows that technology alone is not likely to assure sustainability.
ChainReact process shows that promoting transparency, empowering various stake-
holders of production processes, and eventually pushing for positive change are as
much about building production and supply chain data ecosystem, as about getting
companies’ buy-ins, organizing research groups, and working with legislators. The
current WikiRate experience can update our thinking on how promoting sustainabil-
ity could realistically look like in a fully realized world of Industry 4.0.
Keywords Sustainable supply chain · Digitalization · Supply chain transparency ·

Supply chain data ecosystem
1 Introduction
Even the reluctant economists from IMF and World Bank admit that we are experi-
encing the next turning point in the modes of industrial production, which adds to
the transformation of society, economy, and politics under the impact of information
Ł. Jonak · R. Włoch
Institute of Sociology and Digital Economy Lab, University of Warsaw, Warsaw, Poland
A. Rudnicka (B)
Faculty of Management, University of Lodz, Matejki 22/26, 92-237 Lodz, Poland
90 Ł. Jonak et al.
and communication technologies (IMF, Measuring the Digital Economy 2018). The
chapter aims at empirical anchoring of the theoretical assumptions that the newest
technological solutions, particularly those connected with the lump idea of Industry
4.0. will substantially contribute to sustainability of supply chains. We use the exam-
ple of an advanced tool created by the Horizon 2020 project ChainReact to bring out
the opportunities stemming from the refined integration of data and its presentation
in a clear and concise manner. The data may be then used by media and NGOs in
order to track the activities of large corporations in their supply chain ecosystems.
2 Why Sustainable Supply Chain Must be Transparent?
The concept of sustainability is well-grounded in macroeconomic debates concern-

ing the activities of both public institutions and industries. The growing aware-
ness of the social and environmental problems accumulated over the years through
irresponsible resource management and human rights abuses have raised expecta-
tions that companies will seek more ethical ways to achieve their goals. But the
intermittent progress of globalization borne out an important conceptual problem:
a company wielding a specific brand may be only the cap of a wide and geograph-
ically scattered chain of suppliers and subcontractors. Hence the attention of both
activists fighting for sustainable development and researchers delving into theoretical
intricacies of the term is being redirected to supply chains (Rajeev et al. 2017; Ansari
and Kant 2017).
A sustainable supply chain (SSC) allows for environmentally and socially respon-
sible management of its economic and noneconomic areas. One of the exemplary
definitions describes the SSC as “the creation of coordinated supply chains through
the voluntary integration of economic, environmental, and social considerations with
key interorganizational business systems designed to efficiently and effectively man-
age the material, information, and capital flows associated with the procurement,
production, and distribution of products or services in order to meet stakeholder
requirements and improve the profitability, competitiveness, and resilience of the
organization over the short- and long-term” (Ahi and Searcy 2013). Regarding envi-
ronmental issues, it deals with such challenges as effective management of natural
resources, efficient waste management, CO2 emission, new product development,
and closing economic cycles. Social aspects cover the problems, in particular, of
human rights and workers’ rights. Both dimensions are analyzed from local and
global perspective and in intra- and interindustrial relations.
Sustainability is closely dependent upon transparency, although, as pointed out
by Gardner et al., the linkages between those phenomena are rather poorly under-
stood (2019) Some scholars equate supply chain transparency with disclosure of
sustainable conditions provided by the suppliers; others underline the importance of
traceability—the ability to track the product through the production process and sup-
ply chain (Egels-Zandén and Hansson 2016). The latter understanding is shared by
some of the representatives of the industry sector: e.g., for Leslie Johnston, executive
Digitalization of Supply Chain Transparency … 91
director of the C&A Foundation, transparency is tantamount to “disclosure of infor-

mation in a standardized manner that enables comparison”, and traceability—to the
“ability to discover information as to when and how a product is made” (Newbold
2018). The aforementioned Gardner et al. argue that “in the context of corporate
accountability, transparency refers to the ability of businesses not only to ‘know
internally’ that they are exercising due diligence but also to ‘show externally’ that
this is the case” (2019). They strongly advocate for linking information transparency
with sustainability governance, and go as far as to propose a concise framework for
information gathering that may improve sustainability of supply chain: traceability
information (associations among actors and between actors and places); transac-
tion information (purchasing practices and investment decisions of actors in supply
chain); impact information (social and environmental impacts and risk along the
production process); policy and commitment information (as introduced by supply
chain actors); activity information (actions taken by the supply chain actors to reach
the targets set in their policies); and effectiveness information (progress by each actor
or place).
The essential question concerns the structure of accountability when it comes to
sustainability in supply chains; in other words, who is responsible for and entitled
to monitoring the supply chains and checking their sustainability? We will return to
it later, now turning to another key problem of how to extract such multilevel infor-
mation from a complex supply chain, often scattered geographically over several
political and economic institutional frameworks. Traditional reporting and monitor-
ing do not measure up to the need for timely and accurate information about the
activities of supply chain stakeholders. Much more promising are the technological
developments forming the basis of a brand new concept of Industry 4.0 (Kamble
et al. 2018; Smit et al. 2016).
3 The Promising Flood of Data
The ongoing technological revolution is much more combinatorial in character than

the previous ones, meaning that the new inventions spurt a plethora of subsequent
ones, and the technological pace is unabashedly described as exponential (Schwab
2017) Miniaturized computer (that is fit to stand on a desk, not in the three adjoining
rooms) together with the Internet supplemented by the World Wide Web introduced
the era of connectivity in everyday life and business. Yet for the manufacturing indus-
try, the key change came quite recently with the introduction of miniaturized, but
intelligent sensors equipped with effective microprocessors and signal conditioning
circuitry. The most common types of sensors gather acoustic, chemical, electrical,
environmental, image, motion and force, and touch inputs. They are able to monitor
their environment, collect rudimental data, process them with embedded computa-
tional resources, and communicate with other devices (Deloitte 2018). Their spread
was obviously facilitated by their dropping prices: in 2004, an average price oscillated
around 1.3 USD per sensor, in 2017—around 50 cents. In 2006, there were 2 billion
92 Ł. Jonak et al.
intelligent sensors, in 2020, their number is predicted at 200 billion (Ennomotive

industrial IoT 2017).
Naturally, sensors are important, but not sufficiently so to start a new industrial
revolution. The other crucial components are faster communication, geared by the
introduction of new connectivity standards (and it will become even more faster
with the implementation of 5G), and the rapidly growing uptake of cloud computing
together with the data processing mechanisms based on AI. Taken together—sensors,
connectivity, AI-based processing, and learning)—opened quite new possibilities for
the progress of automation. The manufacturing robots are becoming more agile and
more mobile, making human–machine interfaces more indispensable in factories
(Sirkin et al. 2015). The network connecting sensor-equipped objects that enable the
flow of data forms the Internet of Things. When integrated with people and systems
on the factory floor and beyond it, the Industrial IoT gives rise to a new mode of
manufacturing and marketing, elegantly dubbed Industry 4.0 (Popkova et al. 2018)
The authorship of the notion is commonly attributed to the proponents of the Federal
Government High Tech Strategy, first presented publicly during the Hanover Techno-
logical Fair in 2011, and it was meant to signify a process of transformation of global
value chains stimulated by intermittent progress in information and communication
technologies (Kagermann et al. 2013; Thoben et al. 2017). The 4.0. denominator
alluded both to the enumeration of previous industrial revolutions (the first one pre-
cipitated by the invention of steam machine, the second one—by the electrification,
the third one characterized by automation and computerization), and to the stages of
development of the Internet (Web 1.0. of e-commerce explosion, Web 2.0. of inter-
active content generation, semantic executing Web 3.0. and emerging mobile Web
4.0., connecting the real and the virtual).
Introduced in factories, fleets, and embedded products, the more and more ubiq-
uitous and super connected sensors allow for monitoring of the machinery and coun-
teracting unexpected breakdown by real-time maintenance; they make it possible to
automate transport and logistics; they optimize inventory practices, making it possi-
ble to intermittently analyze the stocks and alert the managers when they are getting
low. Additionally, the implementation of sensors in the product life cycle may add
to its personalization in response to the customer’s needs, as signalized by his or her
real-life usage and behavior (Pilloni 2018) Perhaps most importantly, IoT solutions
may greatly facilitate asset and product tracking down the supply chain (Supply
Chain 4.0 2016; Müller et al. 2018). Already in 2014, nearly half of global 593
companies surveyed by Forrester hoped that IoT will help them to locate objects,
containers, transactions, and people, resulting in supply chain optimization, visi-
bility, and loss prevention (Internet of Things 2014) They harbor hopes that taken
together the solutions inscribed in the concept of Industry 4.0. will revolutionize the
production processes, sharing the sentiment voiced by Erskin Blunck and Hedwig
Werthmann that “Within Industry 4.0, physical production processes and informa-
tion and communication technology grow more closely together (…). Through this
development, production processes get transparent and easily influenceable” (Blunck
and Werthmann 2017) The same applies to the whole supply chain. The question is
transparent to whom and influenceable by whom?
3.1 Quis Custodies Ipso Custodes?
Never before business had access to some much data to be utilized in order to raise
the productivity, to enhance product personalization, to tailor the marketing offer
and expand to the new markets, and to optimize the management and introduce the
real-time decision-making. The already somewhat clichéd saying goes that for the
new digital economy, data is what coal and steel were for the industrial economy
in the nineteenth-century and oil in the twentieth-century economy, namely a new
production factor, determining not only the business effectiveness but also the devel-
opment of the new business models and economic relations (Internet of Things 2014).
This new abundance of data and information begets managerial knowledge about the
functioning of the companies together with their complex supply chain, which is
used by the decisive nodes of the supply chain for their internal and external goals.
The sheer fact of there being more data does not mean that the companies will be
willing to open all of them; rather, they will compromise the transparency necessities
according to their interests. As noted by the researchers studying the apparel industry
“the Industry 4.0 guiding principle was not initially focused on providing solutions to
the ecological problems faced by production, but on boosting productivity, revenue
growth, and competitiveness” (Egels-Zanden and Hansson 2016). Some of this infor-
mation will be shared with customers in order to build the brand image, e.g., in order
to show the ecological breeding of the chicken, the person has to consume in a fancy
restaurant or the decent working conditions in the apparel factory in Bangladesh
to somebody buying a T-shirt (McDermott 2018). Yet, there is growing awareness
that the corporations use the cleverly selective presentation data to whitewash their
activities for the benefit of their PR messaging. For example, the corporations often
claim to work toward transparency through introduction of common auditing pro-
cedures. Craig Carter and Dale Rogers venture that such procedures “adopted by
an industry coalition can allow a single, effective supplier sustainability audit to be
performed, which increases transparency and supplier sustainability while lowering
transaction costs for both the supplier and the multiple buying organizations that
might do business with that supplier” (Carter et al. 2008). Still, a 2016 study by
Genevieve LeBaron and Jane Lister from University of Sheffield found that with
the willing support from the growing audit industry, the global corporations “have
designed a system of self-regulation that allows their suppliers to cover-up abuses
and easily cheat a weak inspection system” (LeBaron and Lister 2016).
Here enter the actors of the civil society, such as the media and nongovernmen-
tal organizations. Only a strong ecosystem of external stakeholders who may play
the role of both watchdogs and engaged partners to companies strive to develop
their CSR. The essence of transparency, in addition to two-side communication, is
the involvement of various groups of stakeholders who have diversified information
important for sustainable supply chain management. On the other hand suppliers,
employees (including employees of suppliers), clients, and nongovernmental orga-
nizations expect the availability of supply chain data for their decision-making pro-
cesses (Pieters 2013). Yet the access to data is not all: the data produced by plethora
94 Ł. Jonak et al.
of suppliers, subcontractors, and increasingly by sensors are often unstructured and

come in diverse and inconvenient formats. The key to sustainability lays in trans-
forming data into actionable information that may be used to change the negative
situation. And that is the vision of ChainReact project: “So long as public data on
corporate supplier networks remain poor and scarce, stakeholders are powerless to
remedy the networks’ faults” (ChainReact 2018).
4 ChainReact—Toward Transparent Relations in Supply

Chains
4.1 From Sustainable Corporations to Sustainable Supply

Chain
ChainReact is a project funded by the European Commission’s Horizon 2020 frame-

work as a part of CAPS (“Collective Awareness Platforms for Sustainability and
Social Innovation”) topic. The project consortium comprises of six partners from
four countries, led by Wikirate foundation (Berlin). The explicit core premise of
ChainReact project is that working toward improving the sustainability of supply
chains is a multi-stakeholder process. Leaving it only to the companies to fix the
issues in their supply chains and monitor their sustainability performance is likely
to underrepresent the interests of employees, clients, and general public, affected
by production and distribution process. In order to address all the dimensions of
sustainability of global supply chains, the information about them needs to be made
transparent and actionable.
This approach is inherited from Wikirate.org, the project and platform
ChainReact extends. The original Wikirate is concentrated on crowdsourcing sus-
tainability information about singular entities—companies. Its “theory of change”
states that the improvement of companies in the area of sustainability is driven by
the feedback of informed stakeholders. In order for the stakeholders to be informed,
the transparency of ESG data needs to be achieved. The main problem Wikirate tries
to resolve is the quality of sustainability-related data: they are closed in corporate
databases or buried deep in official reports, messy, isolated from the context and
other data, and often presented in unengaging ways. Wikirate.org is an open research
platform, where the data is gathered, structured, integrated and related to other enti-
ties, and presented in a way that makes it easy to analyze and use. Its activity revolves
around the concept of a “metric”. Each metrics is one data point per company per
year, answering a concrete research question (e.g., what was company’s “X” CO2
emission in 2018?). The metrics are concrete, standardized (hence, comparable) with
metadata about methodology and idea behind given Table 1.
ChainReact applies this framework to supply chains. While the Wikirate approach
concentrates on a singular company, ChainReact sets out to map entire supply chains
and to provide information on their sustainability performance. The project relies
Table 1 How Wikirate can improve the metrics of sustainability in supply chains
Without Wikirate With Wikirate
Closed/Expensive: ESG data are often Free and Open: data access—via web or API;
proprietary and prohibitively costly and thus community—anyone can join and contribute;
only useful to the privileged few methodologies—includes derivatives; source
software—available at GitHub
Messy: Companies produce abundant reports Structured: WikiRate contributors are
in PDFs, which can’t be queried or easily structuring data into standardized Metrics via
interpreted by machines, making it difficult to scraping, API, and crowd research
compare one company with another
Isolated: Data silos, high-level ratings Interconnected: WikiRate brings together
without sources, and low-level data without metrics from many different researchers and
analysis combine to make ESG data almost makes answers easy to navigate, interpret,
impossible to navigate improve, and recombine
Dull: Often, reports are produced for a narrow Engaging: WikiRate will make data more
audience of experts and are inscrutable to digestible so that more people can engage and
those unfamiliar with jargon demand better metrics, better data, and better
companies
Source WikiRate (2018)
on the basic infrastructure Wikirate has been built upon and uses metrics already
present on the platform, but adds important aspects of network mapping and pro-
viding contextual, supply chain related information about network nodes/companies.
A special class of metric has been developed: relationship metric, which stores infor-
mation about ties between companies in supply chains and other hierarchical rela-
tions between firms. These metrics answer question whether two companies have a
tie between them or not.
4.2 ChainReact Supply Network Map
To date, 16 different relationships have been defined. For a given company, they
indicate the ties having a specific supplier or owning a specific factory. The snapshot
of the most recent network state comprises of almost 67,000 various relationships,
mapped for over 16,500 companies. The graphical representation of this network is
shown in Fig. 1.
The most prominent features of this graph are hubs of companies and their sup-
pliers (“supplied by” relationships) and, in the middle, a complex component com-
prised of the relationships of using minerals smelted at a given facility, related to
the “conflict minerals” issue and advocacy. Remarkably, in spite of the fact that the
relationships that make the network have been obtained through different method-
ologies and mechanisms (both automatic and manual), and that they map various
industries, the network is not fragmented. 99% of companies belong to the main
component. This shows that the need to use different strategies in order to “feed”
96 Ł. Jonak et al.
Fig. 1 ChainReact supply network map
the database (described below in more detail) still is able to yield a global, systemic
view of companies’ interdependence in the context of supplier networks.
There are some interesting structural features emerging in the network after assem-
bling the network out of merely dyadic relationships. One of them would the depen-
dence of suppliers on more than one customer. The network close-up below shows
how tightly integrated the network customers (bigger node) and their suppliers (small
nodes at the end of arrows) can be (Fig. 2).
This illustrates the highly complex nature of contemporary supply chains systems.
One of the consequences of this complexity is making the design and execution of
advocacy actions in supply chain areas (e.g., trying to influence the improvements of
working conditions) complicated due to the number of actors and institutions with
interwoven interests.
Another interesting structural feature is a certain amount of “transitivity of
authority”, illustrated in Fig. 3.
Here, we can see the network of suppliers of a major company (Columbia
Sportswear, the big node, its suppliers being at the end of orange arrows). This
company is at the same time “at the receiving end” of a number of “is shareholder
of” relationships (green arrows). Again, this kind of structure has consequences for
Fig. 2 Close-up on “supplied by” network
Fig. 3 Example of “transitivity of authority” in supply network map

98 Ł. Jonak et al.
the way the issues of sustainability in supply chains can be addressed. Influence
over what is going on at the “edges” of the network (e.g., in factories in economi-
cally and socially challenges regions) extends beyond the immediate customers of
factories and other categories of suppliers. The entities such as shareholders or sub-
sidizers, also have their role to play in the efforts to improve sustainability of supply
chains. ChainReact’s goal is to make this kind of structural relationships visible and
actionable.
Connecting Issues “At The Edges” of the Network

The other aspect of expanding Wikirate.org with network dimension is adding data
to the supply-related network. Partially, this data had already been present on Wiki-
Rate.org: company profiles and their individual metrics which can be readily inte-
grated with structural data. However, there are specific information that are to be
supplied by ChainReact project. They are, for example, derived from the Whistle,
a tool developed by the University of Cambridge as a part of ChainReact initia-
tive, allowing specialized NGO to run reporting campaigns on human and employee
rights abuses in production facilities at the edges of supply networks. The reports can
be integrated with structural network data on WikiRate.org. The other enrichment
of relational data is “network-aware metrics”. The ordinary WikiRate.org metrics
inform about sustainability performance of a singular company, e.g., showing the
percentage of women on board of directors of this company. The network version of
the same metric would show this percentage in the entire network of firms comprising
the supply chain of a company. This shows how major companies affect sustainability
in the entire web of their influence over other business entities.
Challenges and Remedies

Creating a publicly available relationship map and performance database of supply
networks is a challenging task. The biggest obstacle is, of course, obtaining the data.
The ultimate source of information about sustainability of company’s supply chain, as
with any other sustainability measures, is company itself. However, in case of infor-
mation about supply networks, there appear additional obstacles to disclose them.
First, corporate reporting obligations regarding supply chains are still not as wide
as in case of traditional sustainability areas. More importantly, the owner of much
information about given aspect of sustainability in company’s supply chain is not the
company itself, but its supplier, an independent business entity. Finally, the disclo-
sure of information about the structure of supply chain itself can be seen as much
more threatening to companies than making available only traditional sustainability-
related information; the relationships with suppliers are, after all, vital for competitive
advantage.
If we consult the sustainable supply chain maturity model (Rudnicka 2016), we
will find out, what ChainReact requires from companies, if they are to be a source of
information on supply chains, is for them to score the highest (5) level of maturity at
least on the “communication dimension”, and as high as possible on other dimensions
(knowledge, impact, social risk, environmental risk, and cooperation). The highest
level of maturity assumes “two-side flow of information, clients, and users included
in the process (feedback), social and environmental KPIs publicly available, dif-
ferent channels of communication available” (205). The ChainReact consortium’s
experiences with trying to understand companies’ operations show that many of them
stop at “4.5” level of maturity: they have their supply network mapped, influence
its conduct as a part of their business model (including whistleblower support), they
communicate and cooperate with their suppliers in order to minimize social and
environmental risks—all of it without fully disclosing the relevant information to the
public.
In order to overcome difficulties in obtaining supply chain data, the ChainReact
project worked out several specific approaches, both direct and indirect.
Direct approaches involve various ways of engaging companies. In order to
understand the drivers and barriers to supply chain information disclosure, a number
of research activities took place. The interviews, surveys, and workshops with rep-
resentatives of firms, often involving officers responsible for sustainability, showed
that indeed the PR and strategic considerations keep them from releasing much of
supply chain related information to the public. One of the things that could make
them more receptive to the idea of information disclosure is to present companies
with clear advantages of making information available through a platform like Wiki-
Rate.org/Chainreact, helping them connect with stakeholder groups relevant to them
(investors, students, and clients).
In order to encourage companies to disclose their data, a number of features of
WikiRate platform have been developed. The company accounts introduce a way
for companies to participate in creating and researching supply chain datascape
officially, as verified entities. This way they can disclose their information in more
controlled way (while still under scrutiny of the wider open-source WikiRate.org
community), and easily compare their performance with that of their competition,
with the use of dashboarding tools. Benchmarking is another way to make comparison
of companies more straightforward. Two pilot benchmarks have been developed.
The first one has been prepared in the cooperation with Corporate Human Rights
Benchmark and brings CHRB methodology to the platform. The second one aims at
comparing the top 100 companies in India with cooperation with Oxfam India, using
India Responsible Business Index extended with environmental performance indices.
Finally, The WikiRate Index of Transparency intends to measure companies’ data
profiles on WikiRate in terms of their completeness and hence to encourage more data
disclosure. The higher the score, the more information about a company is available
in terms of number of answers to important metrics (metrics often used or upvoted
by WikiRate community).
In the face of difficulties in obtaining supply chain disclosures from companies
themselves, the indirect approaches to feeding data into ChainReact ecosystem are
vital. There are many sources on intercompany relationship data—the problem is
the data profile, fragmentation, and quality. One of the partners of ChainReact con-
sortium is OpenCorporates, organization operating the world’s biggest database of
corporate entities and relationships (such as being a stakeholder or voting control).
There is a bidirectional communication between OpenCorporates and WikiRate.org
database. The new companies that enter into the database through ChainReact efforts
100 Ł. Jonak et al.
are matched with OpenCorporates entities so that the details of those companies can
be imported from the latter to WikiRate. The relevant relationships from the point
of view of supply chains (mainly having to do with hierarchical control) are also
imported into ChainReact framework. On the other hand, the data from WikiRate is
made available to OpenCorporates as well. The initial technical problem with this
cooperation is that both organizations use different ideas of “company”. OpenCorpo-
rate uses a “legal entity” definition, while WikiRate/ChainReact “companies” can be
also brands, physical factories, etc. Special algorithm had been developed in order to
accurately map entities from both databases. This kind of categorization problem will
be constantly present as infrastructure of Industry 4.0 which makes data integration
across fields and organizations more feasible from the technical point of view.
The important sources of information on supply chain networks are various pub-
lished documents such as company annual reports and public directories. Many
of them are presented in the form of pdf documents, unstructured and without
metadata, and in order to utilize them, one of the Consortium partners developed
the pdf-extractor tool, the usage of which yielded a sizable amount of relationship
metrics in ChainReact database (Gkatziaki et al. 2018). Even if supply chain and
sustainability data are made available, their quality and structure are often very low,
and they require a great deal of cleaning and normalizing. In order to facilitate the
usability of disclosed supply chain data, ChainReact and Open Apparel Registry for-
mulated the Open Standard for Supplier Disclosure, which, if widely adopted, should
help immensely with data integration. The Open Standard for Supplier Disclosure
has been published under the umbrella of Transparency Pledge Coalition, the goal of
which is to drive further disclosures of information from companies. The Coalition
managed to persuade 70 companies to pledge to disclose information about their
suppliers.
All of the above strategies and methods are the means of obtaining supply chain
network data in the face of more or less pronounced companies’ reluctance to disclose
this information themselves. On one hand, the strategies involve efforts in building
“collective advocacy” groups, a network of alliances and cooperation, to pressure
corporate entities to share data important from the point of view of public interest.
At the same time, a lot of technical development needs to take place in areas of data
integration, processing, and analyzing. In other words, ChainReact, in its pursuit to
make supplier data transparent gets involved in typical “heterogeneous engineering”,
trying to establish a techno-social web of relations, strong enough to be able to work
toward more sustainable supply chains.
5 Conclusions
We started the chapter with a somewhat exaggerated description of the opportunities

that the steady development of the technical solutions connected with Industry 4.0.
may bring into the area of monitoring the sustainability of supply chains. Undoubt-
edly, more data will enable the companies to see better through the complex network
of their supply chains and hence make decisions concerning production and market-
ing faster and more efficiently. However, truly sustainable supply chains may exist
only in open ecosystem of internal and external stakeholders other than the dominant
(brand) company itself, who have open access to supply chain data and are able to
understand them in order to act on their basis.
Does WikiRate/ChainReact case cast some light on the emerging possibilities of
technological solutions to be used for better monitoring of sustainability of supply
chains by stakeholders other than the companies themselves? Several points are
worth making. First of all, a huge conceptual and analytical effort is needed to make
information out of data—even the fully realized Industry 4.0. will not automatically
make corporate data instantly actionable (open, connected, and engaging), mainly
due to their incompatible formats. But the essential lesson the project drew from the
efforts to collect data and make use of them is that companies will act as gatekeepers
to the data and information they deem important. Without the cooperation of the
business world, the civil society actors’ efforts will be ineffective. There is a need
for consistent and persevering political and civic pressure to create and develop
common standards such as Open Standard for Supplier Disclosure. Ideally, the data-
driven policy should be integrated into material fabric of Industry 4.0, so that there is
a constant pressure for sustainability improvement, similar to “on-chain governance”
mechanism of blockchains governance so that there is no further need for constant
social advocacy.
Acknowledgements This work was supported by the WikiRate and ChainReact projects, partially
funded by the EC under contracts FP7-609897 and H2020-687967.
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Sustainability as Criteria of Evaluation
of Suppliers
Maciej Urbaniak
Abstract The purpose of the article is to present the use by international corporations
of sustainability concepts as criteria for initial and periodic evaluation of suppliers.
In recent times, one may have noticed that global companies are increasingly imple-
menting their strategies based on the concept of sustainable development, and are
evaluating and selecting their suppliers based on the sustainability concept. While
observing global trends one could notice that more and more suppliers are moni-
tored in terms of the principles of sustainable development. This concept includes
the economic aspects (requiring high technical quality, the reliability of supply, price
competitiveness), environmental aspects, as well as social ones (rules based on the
idea of the Global Compact) Requirements for the implementation of this concept
are transferred to suppliers by issuing rules of conduct and ethical standards. The
analyses, presented here on practical examples of the chemical, electronics, and
pharmaceutical manufacturers show that buyers define specific standards for eth-
ical conduct to their suppliers. Multinational enterprises which are buyers do not
limit themselves to putting stringent requirements on suppliers. They also offer their
providers support programs for the implementation of the sustainability concept.
Keywords Sustainability · Supplier requirements · Supplier evaluation · The

chemical · Electronics and pharmaceutical manufacturers · International
corporations
1 The Process of Building a Relationship with Suppliers
Supply chain partnership in the result of some kind of evolution of buying processes
from the repetitive transactions based on the loyalty of B2B customers to the source
of purchase. Many recurring transactions are often transformed into long-term win-
win relationships based on trust (Lee et al. 2013). They can lead to many mutual
benefits for the partners such as development product quality, shorten order cycles,
improvement of process efficiency, effective communication between the supplier,
M. Urbaniak (B)
Faculty of Management, Lodz University, 90-237 Lodz, Poland
104 M. Urbaniak
and the clients or joint research and development projects. The observation of busi-
ness practice shows that many companies improving the processes in a supply chain
focus on the implementation of quality, environmental, health, and safety (QEHS)
management systems conform to organizational standards issued by International
Organization for Standardization (ISO). Many enterprises often define individual-
ized requirements for their suppliers through specifications to determine not only
the issues related to quality assurance (safety of products and processes) but also
organizational performance related to achieve cost reduction as well as reducing the
negative impact on the environment (Sancha et al. 2016).
The process of building relationships with suppliers can be summarized in ten
phases. These are:
Setting the expectations and requirements for suppliers in terms of technical
quality and service (before and after the sale), the frequency of orders, organizational
systems (implementation of QHSE management standards, technical and technolog-
ical capabilities as well as financial conditions;
• Identification of potential suppliers;
• Assessment of potential suppliers (through self-assessment questionnaires, anal-
ysis of submitted bids, auditing factories owned by providers);
• Supplier classifications;
• Negotiating the terms of deliveries with the supplier;
• Choice of the supplier;
• Contract agreement;
• The ordering (establish order, handling order);
• Performance of the contract realization;
• Evaluation of cooperation and development of partnerships, including periodic
rating of suppliers (through the scoring or indicators), assessing the impact of
cooperation with the supplier to improve the efficiency of processes in the supply
chain (design, purchasing, warehousing, manufacturing, maintenance, environ-
mental and safety management, and compliance with best practices in the field of
ethical conduct) (Urbaniak 2015).
A partnership comprises a process in which the customer and the supplier grad-
ually build strong and extensive social, economic, and technical relationships. If the
parties are satisfied with keeping to the arrangements set out in the agreements, their
cooperation may transform into a close partnership (Wagner 2011). The benefits
enhance the positive images of the partners. In some cases, a connection between the
supplier and the customer may transform into a strategic alliance that is based on the
joint achievement of specific long-term goals (Su and Yang 2017). Positive evaluation
of these activities is essential to maintain these relationships and a sign of readiness
for further cooperation alliances, by which each client and supplier can perceive the
number of measurable benefits (Forkmann et al. 2016). The condition of their feel-
ings is effective communication in the form and content of communication should
meet the expectations of each partner. The activities of multinational corporations,
which introduced the concept of sustainability are heavily focused on collaboration
with its partners in the supply chain (suppliers and customers). Large corporations
Sustainability as Criteria of Evaluation of Suppliers 105
are increasingly offering their support through joint ventures, such as deployment
projects operational improvement tools (environmental and safety management sys-
tems), or develop concepts for new products. Build partnerships with customers and
suppliers, can bring the supply chain many important benefits such as:
• To ensure business continuity, which is based on methodology of the risk man-
agement concept (identification, analysis, and hazard mitigation associated with
the product and the processes);
• Increased flexibility, efficiency, and effectiveness of the operations;
• Promotion of ethical behavior in economic activity (Goebel et al. 2012).
Many companies also assess suppliers on the basis of their level of management
focusing on the guidelines of ISO 9001 and ISO 14001 organizational standards.
Many international companies publish their own holistic requirements (in the form
of Supplier Quality Requirements Manuals, Supplier Quality, and Excellence Man-
uals, Customer-Specific Requirements) which are relevant to a wider range than
those of international standards. Compliance with these requirements the clients are
verified by the client through the audits and self-assessment of suppliers. Auditing
suppliers and their implementation of an environmental management system are
particularly noticeable in the case of large business entities, companies with foreign
capital, and firms offering products in B2B sector. An organization that purchases all
kinds of materials, equipment or tools should specify precisely the subject of order
and place it with a qualified supplier. When developing cooperation with suppliers,
companies monitor them using audits and regular evaluation (based on the analysis
of requirements meeting). During the audits, particular attention is paid to the iden-
tification of risk connected with operational processes and products, work safety, as
well as management of environmental aspects.
2 Requirements for Suppliers in Terms

of the Sustainability Concept
2.1 The Methodology of Supplier Evaluation in the Field

of Sustainability
International companies more and more often, in addition to technical requirements

(contained in relevant regulations and technical specifications concerning products),
also give suppliers their specific expectations related to the implementation of the
concept of sustainability (Guenther et al. 2015). Corporations provide these require-
ments by publishing guidelines, guides, and codes of conduct for suppliers. The
degree of meeting these requirements is verified by providing Self-evaluation Ques-
tionnaires to the suppliers. These questionnaires are used to assess counterparties to
the extent they are able to meet technical and organizational requirements. Suppliers
106 M. Urbaniak
interested in cooperating with international corporations fill out self-assessment ques-

tionnaires to provide evidence that these requirements have been met. Verification of
this evidence is carried out through audits. During the audits, checklist scoring lists
are very often used to determine the scope and degree of compliance of potential
suppliers (Nakajima et al. 2015). The next step is screening the supplier and ana-
lyzing the collected data from the self-assessment reports (including the degree of
possibility to meet the client’s expectations), observations collected during the audits
(Burritt and Schaltegger 2014).
The legal and financial situation (legal structure and shareholding, legal titles to
tangible and intangible assets), fulfillment of liabilities (financial/tangible/intangible
assets, indebtedness, profitability, liquidity) is also important for the initial evalua-
tion of suppliers, financial resources, shares in other enterprises, the type and scope
of insurance, and financial guarantees) that may determine the stability and sus-
tainability of these relationships in the future. The above-mentioned criteria are not
taken into account only in the initial assessment and qualification of suppliers. Many
international corporations concluding contracts with suppliers oblige them to sign
a statement obliging them to introduce a concept of sustainability by applying the
principles contained in the Statement on Business Practices and the Supplier Social
and Environmental Responsibility Agreement, e.g., Hewlett-Packard. Periodic
assessment of suppliers taking into account the criteria related to social responsi-
bility is most often carried out using self-assessment forms. They are used to assess
the improvement of these activities using appropriate measures to verify the level of
objectives set in the way of achieved indicators (current results). The supplier sus-
tainability report data provided by suppliers are then verified by second party audits
(performed by auditors and experts of the client enterprise) or third party audits (per-
formed by auditors and experts from independent certificate bodies). These reports
take into account data based on economic, environmental and social indicators (pay-
ing particular attention to elements such as hiring practices, respect for human rights
or product liability) (Kumar et al. 2014).
The results of audits (both second and third parties) are documented in the rele-
vant reports. If any nonconformities and/or remarks are found in the reports, suppliers
are obliged to implement appropriate (effective) corrective and/or preventive actions
(CAPA). A special form of assessment of the degree of implementation of the con-
cept of social responsibility IS the certification audits. Some of the international
concerns honor the results of certification audits in order to confirm the requirements
of international standards in the area of sustainability as part of the initial and interim
evaluation. The most recognizable certification is the assessment of compliance with
the guidelines published by Social Accountability International. However, the sup-
pliers’ interest in the certification of management systems for compliance with the
requirements of the SA 8000 social responsibility standard is rather moderate.
2.2 Code of Conduct for Suppliers
Observing the global trends, one could note that in recent years more and more
suppliers are monitored by their clients for the fulfillment of the principles of sustain-
ability concept which are guided by the economic aspects (requiring high technical
quality of the products, reliability of supply, price competitiveness, service support),
environmental aspects, as well as social aspects based on the idea of the Global
Compact (Mani et al. 2018). Analyzing global trends, it can also be observed that
more and more international corporations take into account the criterion related to
sustainability activities when assessing the initial and periodic suppliers (Kumar and
Rahman 2015; Khan et al. 2018). Business entities that are buyers often publish their
requirements in relation to suppliers in documents in the form of guidelines such
as the Supplier Corporate Social Responsibility Guidelines (like Toyota, Mazda,
Subaru, and Renault-Nissan) or the Supplier Code of Conduct (like ABB, Apple,
Bayer, BASF, Deutsche Post DHL, Microsoft, Nestlé, Siemens, and Skanska). Both
the guidelines and codes of conduct are based on the principles of the Global Com-
pact, which refer to respect for human rights, ensuring labor standards, protection
of the environment, and counteracting corruption. These guidelines and codes also
related to other international documents such as: OECD Guidelines for Multinational
Enterprises, International Labor Standards, guidelines of the International Standard-
ization Organization like ISO 9001 (quality management standard), ISO series 14000
(environmental management standards), ISO 26000 (social responsibility standard),
and other management standards like Social Accountability 8000, or AccountAbil-
ity 1000, requirements of the Occupational Health and Safety Assessment series
18,000, as well as reports GRI (Global Reporting Initiative) guidelines. One could
also observe increasing number of rules of behavior and ethical standards for sup-
pliers (Supplier Conduct Principles, Principles, and Standards of Ethical Supply
Management Conduct), guides for CSR implementation (Supply Chain CSR Deploy-
ment Guidebook, Purchasing Way, Supplier Sustainability Program Manual), orga-
nizing programs (Supply Chain Social Responsibility programs), and checklist which
are used for self-assessment Supply Chain CSR Checklist. Requirements for suppli-
ers in the implementation of the concept of corporate social responsibility included
in the literature and codes of ethics.
The analysis of literature and reports on corporate social responsibility shows that
many international companies, when evaluating suppliers, develop criteria, which are
included in codes of ethical conduct. These codes most often refer to:
• Carrying out activities strictly adhering to all legal requirements;
• The respect of the Declaration of Human Rights accepted by the United Nations,
the fundamental rights established by the International Labor Organization and
the Global Compact;
• Running the business in accordance with the adopted corporate governance prin-
ciples;
• Preventing discrimination based on sex, age, race, ethnic origin, sexual orientation,
religious or national affiliation or disability;
108 M. Urbaniak
• Providing reliable information to stakeholders (in financial, environmental and

social responsibility reports);
• Environmental protection through the implementation of Cleaner Production pro-
grams, or an environmental management system compliant with the requirements
of the ISO 14001 standard or the EMAS directive;
• Providing employees safe and harmless health as well as ergonomic working con-
ditions (Kannan 2018).
Enterprises that are clients obliging suppliers to implement ethical codes of con-
duct also monitor their compliance by reporting and by conducting audits. The anal-
ysis of literature and business practice indicates the activities of enterprises in the
field of standardization of codes of ethical conduct, especially within certain sectors.
This can be seen in the sector of chemical producers, electronic products, pharma-
ceuticals, toy manufacturers, and jewelry products. It can also be observed that more
and more Original Equipment Manufacturers (OEMs) wanting to shape their image
as credible customers are developing the purchasing code of ethics or customer good
practice guides. Such companies include Philips, Rentokil Initial. These CODs are
business customers’ obligations to equal treatment of suppliers (not to impose finan-
cial conditions) of compliance with contract terms (in particular, deadlines for settling
liabilities and pricing arrangements), arrangements for stable planning cooperation
with regard to technical quality, volume, and frequency of deliveries (Vahidi et al.
2018).
2.3 The Role of Environmental Management

in the Evaluation of Suppliers in the Implementation
Increasingly, international enterprises require their suppliers detailed evidence of the

determining environmental aspects, establishment of environmental objectives and
programs, limiting the use of materials and energy, establish procedures for emer-
gency preparedness and response, training employees, reducing environmentally
harmful factors (greenhouse gas such as carbon dioxide, noise, vibration, wastewater,
solid waste), as well as dissemination of information on the results of activities
related to environmental protection. In conducting audits to assess the functioning
of the environmental management system vendors frequently pay attention to such
elements as:
• Identification of significant environmental aspects and specifying the environmen-
tal objectives, targets, and programs;
• Met environmental legal requirements;
• Establish, implement, maintain, and continually improve the environmental man-
agement system;
• Determinate and provide resources (infrastructure, technology, processes, infor-

mation systems, and relevant qualifications of employees);
• Determinate and achieve environmental indicators (related to energy consumption,
raw materials, waste management, and pollution);
• Establish criteria for the qualification and monitoring of suppliers in the field of
ecological performance (Govindan et al. 2018; Ghadimi et al. 2017; Neutzling
et al. 2018; Gallego-Álvarez and Ortas 2017; Li et al. 2016).
An implementation of an environmental management system is for many enter-
prises one of the main criteria (like ensuring product quality, timeliness, and flexibility
of supply as well as the ability to reduce costs) for initial and periodic evaluation of
suppliers. Emphasis on the implementation of the requirements relating to environ-
mental management is linked to compliance with legal provisions, especially in the
Directives and Regulations of the European Union, such as:
(1) RoHS (Restriction of Hazardous Substances) Directive EU 2003/95/EC,
(2) WEEE (Waste Electrical and Electronic Equipment) Directive 2001/96/EC,
(3) EuP (Eco-design for Energy using Products) Directive 2009/125/EC,
(4) Battery and Accumulator Directive 2006/66/EC,
(5) Packaging Directives 94/62/EC, 2004/12/EC, COM Decision 97/129/EC,
(6) REACH (Registration Evaluation Authorization and Restriction of Chemicals)
Regulation 1907/2006/EC.
The implementation of these EU directives is often required of suppliers from
outside the European Union and especially of large multinationals producing high-
tech products (mainly from the United States and Japan), such as Dell, HP, IBM,
Motorola, Fujitsu, NEC, Panasonic, Sony or Toshiba.
More and more multinational companies require their suppliers to reduce the
negative impact of products and processes on the environment through the imple-
mentation of the concept of Life-Cycle Assessment (LCA, based on ISO 14040
series of standards) and Eco-design approach. This concept focuses on analyzing
and reducing the negative impact of each product on the environment in all phases of
their life cycle (design, manufacturing, distribution, installation, use, maintenance,
disposal/destruction, and dematerialization), or reuse of materials (recycling). These
activities aim at:
• Improved material efficiency (by minimizing consumption of materials, use of
materials with low impact on the environment, use of renewable raw materials
and/or use of materials recovered);
• Improved energy efficiency (by reducing energy consumption, use of energy
sources with low impact on the environment, use of energy from renewable
resources);
• Designing (products and processes) for cleaner production and safe use of products
(through the use of cleaner manufacturing techniques and avoiding the use of
hazardous materials);
110 M. Urbaniak
• Designing for durability (considering in this respect the length of the operation and
the improvements of maintainability of a product, resulting from the emergence
of new technologies);
• Designing for reuse of products, recovery, and recycling (Grzybowska 2012; Kam-
merl et al. 2017; Vahidi et al. 2018).
The Eco-design approach is based on Environmental Effect Analysis (EEA)
and takes into account: the identification of legal requirements, design planning,
conceptual design, the construction and evaluation of a prototype, production, and
packaging).
LCA is a complex process involving the analysis of the profitability of investment
projects with simultaneous emphasis on reducing a product’s negative impact on the
environment. This concept takes into account measures to determine the quantities
of used materials, energy, and waste generated at each process (starting with raw
material extraction, through manufacturing, distribution, use, and reuse/recycling, to
final disposal).
Many companies are adopting a system for collecting information on measures to
reduce the negative impact on the environment by analyzing the incurred expenditures
(costs) and the benefits achieved as a result of the activities of the organization. For
these reasons, it may be noted that in recent years, many enterprises implemented an
environmental accounting system (environmental management bookkeeping), using
in this respect, inter alia, international guidelines such as Environmental Manage-
ment Accounting Procedures and Principles by the United Nations Division for
Sustainable Development. Environmental accounting is taken into consideration
for business units (branches, departments, processes) and particular products.
Environmental accounting is not limited to individual business units, but increas-
ingly it includes in its scope the relationships between partners in the supply chain.
Enterprises implementing environmental cost accounting introduce the concept of
MFCA—Material Flow Cost Accounting (Hänninen and Karjaluoto 2017).
In 2007, Japanese managers suggested a definition of global guidelines on the
implementation of the concept of Material Flow Cost Accounting (MFCA) in the
form of an international standard of management within the group of standards
for environmental management, in particular the ISO 14040 series, concerning the
assessment of the life cycle of the product, and ISO 14064, specifying guidelines
in terms of the quantifying and reporting of emissions and the removal of green-
house gases. Guidelines for the implementation of this concept have been included
in the ISO 14051 standard (Environmental Management—Material Flow Cost
Accounting—General Guidelines), which was published in 2011 (Jia et al. 2018).
This standard establishes guidelines for the identification and quantification of indi-
vidual components of the product (weight, quantity) and the measurement of costs
in the analysis of maps of flow values. The collected information helps to identify
types of waste (losses in the form of waste, energy loss, and implementation of
measures that are not effective) occurring in the flow of materials (raw materials,
parts, components), and opportunities for the reduction of the negative impact on the
environment (by reducing the amount of waste, emissions, etc.) in the operational
processes related to the implementation of the product (design, purchase, produc-

tion, packaging, storage, delivery, use and withdrawal from use). It can also help to
identify potential savings, optimize the quantitative flow of materials, and exploit
the potential of infrastructure (Lo et al. 2018). By identifying waste, one can limit
the purchase of necessary materials (by optimizing the norms of consumption), the
level of waste resulting from non-compliance of the product, and the level of energy
losses, emissions, and wastewater. Currently, the concept of MFCA is increasingly
being implemented in the supply chain of the automotive industry, the chemical and
rubber, metal, textile, food, and timber industries, as well as office equipment and
medical devices.
2.4 The Role of Ethical Conduct in the Evaluation

of Suppliers in the Implementation of the Sustainability
Concept
Many multinational companies have entered into contracts with providers require
them to sign the statement, obligating them to implement the concept of sustainabil-
ity through the application of the principles contained in the Statement on Business
Practices and Supplier Social and Environmental Responsibility Agreement. State-
ments regarding business practices are associated with the strict observance of the
applicable laws, regulations and ethical standards (no practices to combat corruption
and bribery of officials of national and international institutions, non-discrimination
of workers, protection of international human rights) and environmental liability.
More and more companies wanting to develop an image as a reliable partner (client)
develops a purchasing code of ethics and customer and supplier good practice guides.
These code of good practice most often refer to such issues as:
• Conducting business strictly observing all legal provisions;
• Performing business activities in accordance with the adopted corporate gover-
nance principles;
• Avoiding corrupt practices (bribery or commission payment) in contacts with
clients, suppliers, government offices and agencies;
• Respect for the confidentiality of information (contracts and data regarding cus-
tomers, suppliers, employees, marketing plans, financial plans);
• Commit to abide by the principles of fair and open competition (compliance with
applicable antitrust and other norms and legal provisions governing competition);
• Respecting for the intangible resources of the organization, especially the protec-
tion of information;
• Respecting intellectual property rights;
• Providing reliable information to stakeholders on the financial situation, under-
taken investments, limiting the negative impact on the environment (Igarashi et al.
2013; Govindan et al. 2018).
112 M. Urbaniak
Many companies implement their codes of conduct (CODs) by monitoring their com-
pliance (Ghadimi et al. 2017). They set up committees for compliance with corporate
rules, ethics, internal audits, or organizational risk assessment. Companies that have
implemented such rules indicate that an employee who encounters difficulties in
their application is obliged to inform their superiors or directly the ethics and com-
pliance of the ethics and compliance committee. Some companies have also launched
information helplines) in this area of open talk, which allow all employees to raise
concerns regarding violations of codes of conduct, in particular regarding employee
treatment, abuse or violation of safety standards. Many international corporations
that have implemented the concept of sustainability, qualifying their suppliers, are
paying particular attention to building relationships with employees. Guided by the
Global Compact principles, they develop suppliers’ ethical code of conduct, com-
pliance with which is carefully verified through the self-assessment of suppliers and
during initial and periodical audits. Particularly during audits are evaluated such
elements as:
• Compliance with labor standards (ensuring employees safe and harmless to health
as well as ergonomic working conditions);
• Eliminating all forms of forced labor and abolishing child labor;
• The right to the minimum wage and rest;
• Respect for freedom of association;
• Counteracting discrimination in the sphere of employment (based on sex, age,
race, ethnicity, sexual orientation, religious or national affiliation or disability);
• Keeping open communication with employees by consulting decisions;
• Recruitment, employment and promotion of employees solely on the basis of the
qualifications and skills;
• Respect for employees’ right to remuneration, observance of working hours, hol-
idays;
• Keeping open communication with employees by consulting decisions (Neutzling
et al. 2018).
3 The Studies of Sectoral Initiatives in the Fields

of Supplier Evaluation Related to the Implementation
3.1 Supplier Evaluation Criteria Established by the Chemical

Initiative for Sustainable Supply Chain
The Chemical Initiative for Sustainable Supply Chain was taken in the year 2011
by six international concerns from the chemical sector (such as BASF, Bayer,
Evonik Industries, Henkel, Lanxess, and Solvay), is an example of harmonizing the
requirements for auditing suppliers with respect to rules to social responsibility.
This initiative is called Together for Sustainability. It was based on the guidelines
of the United Nations Global Compact, the Responsible Care Initiative promoted by
the International Council of Chemical Associations (ICCA). Its aim is to develop
common criteria for auditing and self-assessment of suppliers. It is intended for its
members that an audit by one of its members be honored by the others in accor-
dance with the idea: “An audit for one is an audit for all” (Gallego-Álvarez and Ortas
2017). Similarly, the supplier’s self-assessment result carried out by one of the affil-
iated organizations is to be honored by the others. The initiative is intended to share
the results of self-assessment and audits at suppliers, to promote the improvement of
their activities in the implementation of the concept of social responsibility and the
exchange of good practices in this area. Other chemical concerns such as Akzo Nobel,
Arkema, Brenntac, Clariant, Covestro, DSM, DuPont, Eastman, Evonic Industries,
IFF, Merck, Sanofi, Syngenta and Wacker also joined this initiative. The evaluation
criteria for audits and the self-assessment of suppliers adopted by Together for Sus-
tainability human rights, governance. Self-assessment and reporting of its results
take place using the platform administered by EcoVadis (Helin and Babri 2015).
3.2 Supplier Evaluation Criteria Established

by the Electronics Industry Citizen Coalition
Another example of unifying the rules for auditing suppliers in terms of criteria
related to social responsibility is the initiative of enterprises associated with the
Electronics Industry Citizen Coalition (Kumara and Rahman 2015). The organization
was founded in the year 2004 to promote a common code of conduct in the elec-
tronic, information and communication industry (ICT). Currently, it associates over
100 companies that are manufacturers of ready-made high-tech products (like Acer,
Apple, Dell, Eastman Kodak, Flextronics, Hewlett-Packard, Hitachi, HTC, IBM,
Konica Minolta, Lenovo, Lexmark, LG Electronics, Logitech, Medtronic, Microsoft,
Motorola, Philips, Samsung, Sony, Texas Instruments, Toshiba, Xerox) and their sup-
pliers around the world. Electronics Industry Citizen Coalition promotes innovative
practices in the field of activities related to sustainable development at suppliers.
These activities are aimed to help deliveries in the scope of:
• The increase of efficiency and effectiveness of processes,
• Improving working conditions and improving staff qualifications,
• Minimizing the risk level of threats in the supply chain in order to ensure the
continuity of operations implemented by the partners,
• Reducing the negative impact on the natural environment,
• Promoting ethical activities in relations with stakeholders.
Enterprises associated in this organization develop standards together for self-
assessment of suppliers, criteria for their auditing, or guidelines for the EICC Code of
Conduct (Mani et al. 2018). The current EICC audit protocol, version 5.1, was ratified
in 2016. One of the major EICC assemblies is self-assessment by Self-Assessment
114 M. Urbaniak
Questionnaire (SAQ) and Validated Audit Process (VAP), the purpose of which is to
demonstrate the degree of compliance with the requirements of the Code of Conduct
(Torres-Ruiz and Ravindran 2018).
3.3 Supplier Evaluation Criteria Established

by the Pharmaceutical Supply Chain Initiative
Another example of the development of common pre-qualification and periodic

qualification criteria for suppliers (in the form of self-assessment and audits) is
the Pharmaceutical Supply Chain Initiative (PSCI) which is an association of 24
world producers of pharmaceutical products (such as Astra Zeneca, Baxter, Bayer,
Boehringer Ingelheim, GlaxoSmithKline, Johnson & Johnson, Merck, Novartis,
Novo Nordisk, Pfizer, Roche, Sanofi, Tekeda, or West). The Pharmaceutical Sup-
ply Chain Initiative did not develop a uniform code of conduct for suppliers. Only
consistent evaluation criteria were defined under this initiative (Crespin-Mazet and
Dontenwill 2012). They cover 10 areas:
• General management systems,
• Environment—general,
• Air emissions,
• Water supply, stormwater, and wastewater,
• Waste management,
• Hazardous materials control and reporting,
• Asbestos, PCBs (polychlorinated biphenyl) and ozone-depleting substances,
• Health and safety documentation,
• Labor documentation,
• Ethics.
Particularly noteworthy are the specific requirements of enterprises from the phar-
maceutical sector contained in the customer codes of conduct for suppliers. These
requirements relate to conducting clinical trials with people (which should be imple-
mented in accordance with the highest medical, scientific, and ethical standards, in
particular with the Helsinki Declaration). These requirements also refer to animal
tests (which should be implemented in a humane manner, maximally reducing their
stress, fear, and pain). Animal studies can only be carried out when there are no
scientifically valid and commonly accepted alternative methods.
4 Supplier Development Programs
4.1 Supplier Development Programs in the Field

of Sustainability
International corporations are increasingly trying to help suppliers to meet stringent

requirements by offering them assistance in the form of consultations and train-
ing in implementing the concept of sustainability (Grimm et al. 2016; Liu et al.
2015; Airike et al. 2016). Suppliers are supported by specialist knowledge provided
through training and specialist consultancy. An example of this type of program is the
ABB’s Supplier Sustainability Development Program (SSDP), which pays particular
attention to suppliers from Brazil, China, India, Mexico, Colombia, Peru, Turkey,
Indonesia, Thailand, Vietnam, and South Africa. The purpose of this program is to
help suppliers meet the requirements set out in the codes of conduct focusing in par-
ticular on ensuring decent conditions and occupational health and safety, as well as
improving environmental impact (https://pscinitiative.org/hom). Support provided
to suppliers is provided in the form of training and the participation of experts in
conducting internal audits and the use of checklists. Another example of such activ-
ities is Volkswagen, which is provided by suppliers as part of the “Sustainability in
the Supply Chain” program in the form of training materials available on the VW
B2B-Platform platform, which enable self-assessment (Trapp and Sarkis 2016).
Suppliers who are not able to meet these requirements to a high degree can get
help in the form of direct coaching, which is run by a team of experts (Ad hoc-Expert-
Team), consisting of specialists in environmental protection, human resources, safety
management and health at work, purchase security as well as quality assurance.
With the participation of experts, they develop plans to improve suppliers in the
implementation of the sustainability concept, which assume achieving targets in the
form of objectives related to environmental protection (such as limiting the use of
harmful substances, carbon dioxide emissions) improving product safety (reducing
production defects, reported complaints by clients) and processes (reducing the risk
of accidents or emergency situations).
Support programs in corporate social responsibility are offered to the suppliers
by companies affiliated to the Electronics Industry Citizen Coalition, which includes
manufacturers of high-tech products (such as Acer, Apple, Dell, Eastman Kodak,
Flextronics, Hewlett-Packard, Hitachi, HTC, IBM, Konica Minolta, Lenovo, Lex-
mark, LG Electronics, Logitech, Medtronic, Microsoft, Motorola, Philips, Samsung,
Sony, Texas Instruments, Toshiba, Xerox).
Supplier development programs in the area of sustainability efforts are focused
on supporting partners to
• Increasing the effectiveness and efficiency of processes;
• The improvement of working conditions and improve employees qualifications;
116 M. Urbaniak
• The reduction of the risk level in the supply chain in order to ensure the continuity
of processes carried out by the partners;
• Elimination of negative impact on the environment;
• Promoting ethical behavior in relations with stakeholders (Rashidi and Saen 2018).
Another project the Electronic Industry Citizenship Coalition, implemented
jointly with the Global e-Sustainability Initiative (GeSI—which currently has over
30 members and partners such as Alcatel Lucent, AT & T, Bakrie Telecom, Bell,
BlackBerry, BT, Deutsche Telekom, Ericsson, HP, Huawei, KPN, Microsoft, Nokia,
Nokia Siemens Networks (NSN), Orange France Telecom Group, Sony Mobile,
Sprint, Swisscom, DTC, Tele2, Telecom Italia, Telefonica, Telenet, Telenor Group,
Turk Telekomunikasyon, Verizon, VimpelCom, Vodafone, ZTE Corporation.) is an
E-TASC (Electronics-Tool For Accountable Supply Chains). E-TASC is an IT solu-
tion that allows EICC and GeSI members to analyze data and generate reports relating
to the assessment of suppliers in meeting the requirements for labor standards, envi-
ronmental impact, risk management, and ethical codes of conduct (Yawar and Seuring
2018). The results of these reports allow for more precise and individualized supplier
development programs in the implementation of the sustainability concept.
4.2 Monitoring of Development of Suppliers
Many companies monitor activities of suppliers using Supplier Performance Card,

collecting data, and conducting appropriate benchmarking rankings take into account
their technical quality, timeliness, cost reduction, technological development, the
rate of implementation by the supplier of new solutions (adaptation time changes
in the process, the product), the possibility of introducing a new product, the reac-
tion rate (for RFQ/preparation of the offer, the complaint/reported a technical prob-
lem, the implementation of corrective/preventive), flexibility (adapting to changes
in customer orders, changes in the economic context), improving environmental
impact (reducing the consumption of materials/energy, reducing greenhouse gases,
reducing waste generation and increase the reuse of materials through the intro-
duction of recycling), progress in the implementation of process improvement tools
and products (http://www.abb.com; https://www.volkswagenag.com; Hoejmose et al.
2014). Many companies also evaluate their suppliers focusing on the implementa-
tion of QEHS management systems. They also audit suppliers periodically. Some
international companies require regular reports on progress in the improvement of
QEHS management systems while monitoring suppliers. They also keep monitoring
them regularly by means of Performance Feedback Reports Cards which contains
data on lowering costs, reducing incompatibility, improving process efficiency and
effectiveness indicators, reducing energy consumption as well as shorter cycles of
process. The above-described behavior may be presented as a cycle of constant
improvement (Raj-Reichert 2013; Yan and Dooley 2013; Yoo et al. 2015; Zhang
et al. 2015). Companies are implementing QEHS management systems that con-
form to ISO organizational standards much more often use full sheets and employ
periodical evaluation indicators as well as audit. They also require that bidders imple-
ment quality management systems and even, more and more often, an environmental
management system. Observing world trends, one may notice easily that recently
suppliers have been monitored from the point of view of meeting the sustainable
development requirements following economic aspects (demanding high technical
quality, delivery reliability, price competitiveness, technical support), more and more
often also environmental aspects and social aspects (principles based on the concept
of the Global Compact). Many OEMs define for their partners supplier the princi-
ples of code of conduct. Particular emphasis on environmental protection is put on
suppliers by Japanese firms which laid down detailed guidelines for suppliers. They
obliged suppliers to adopt principles included in clauses of so-called Statements
on Business Practices) which are connected with binding laws and ethical stan-
dards, avoiding corruption practices and fighting against attempts to bribe domestic
and foreign institutions employees, avoiding employee discrimination, protection of
international human rights and responsibility for the environment. It is worth noticing
that these requirements are not imposed on one party only (use of forcing suppliers
to meet them). More and more companies want to shape their images as reliable part-
ners (customers) and, therefore, draw up purchasing codes of ethics or good practice
guides.
5 Conclusions
Recapitulating the considerations presented in this article, it should be stated that

the solutions in the field of standardization of criteria for initial and periodic assess-
ment of providers responsible for sustainability in selected sectors in specific sectors
strictly rely on the latest international guidelines and global management standards.
This criteria strictly focus on legal compliance, anti-corruption and fair competi-
tion, respect for fundamental employment rights, health and safety of employees,
environmental protection as well as sustainability in supplier management. When
comparing the differences between sectors in terms of evaluation criteria, it can be
seen that they result from their specificity (processed raw materials, materials and
offered finished products in supply chains). An advantage of the presented standard-
ized criteria is their comprehensiveness, regularity of independent assessments, and
self-assessment of suppliers. It should, therefore, be stated that the requirements
imposed on suppliers by international concerns as well as the programs offered for
their development contribute to their sustainability focusing on guaranteeing the
safety of products and processes in supply chains, eliminating the negative impact
on the environment, improving working conditions, and promoting ethical behavior
in economic relations. The implementation of this concept has a significant effect
on limiting the risk of threats in the supply chain and contributes to ensuring the
continuity of processes implemented by the partners. Improvement of activities by
118 M. Urbaniak
suppliers aimed at achieving sustainability should limit the risk in supply chains and
increase their resilience to the disruption that may occur (Wilhelm et al. 2016; Winter
and Lasch 2016; Prasanna and Goh 2016).
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Sustainable Supply Chain Management
in the Perspective of Sharing Economy
Piotr Banaszyk and Anna Łupicka
Abstract In the literature, a notion of managing a sustainable supply chain or sharing

economy is current over a decade. The research goal of this chapter is the reconstruc-
tion and interpretation of the key assumptions of the sharing economy and the concept
of managing the sustainable supply chain, and then, confronting these assumptions
with answering the question signaled as a research problem. How can the sharing
economy be the theoretical basis for a conceptual reference to supply chain man-
agement? Proposed premises to the model building assume that sustainable supply
chain management is implemented due to optimization criteria, closely related to the
TBL approach, which is correlated with sharing economy.
Keywords Managing the sustainable supply chain · Sharing economy ·

Categories · Practices · Definitions · Optimization criteria
1 Introduction
The phenomenon of present times is emerging and playing a more and more econom-
ically important role in the so-called supply chains. The supply chain is understood
as a set of cooperating enterprises located along the sequence of adding utility value
to products in subsequent phases of technical and technological operations, start-
ing from companies acquiring resources, to sellers of ready products intended for
final consumption. Processes and events related to the emergence, maintenance, and
change of supply chains are becoming an increasingly common subject of both eco-
1
nomic research and management practice. Both these types of activities usually
refer to and derive justifications from some ideological or theoretical concepts. The
1 In scholar.google, you can find almost 35,000 scientific publications published only in 2018.
P. Banaszyk · A. Łupicka (B)

Poznan University of Economics and Business, Poznan, Poland
P. Banaszyk

122 P. Banaszyk and A. Łupicka
area of interest of this study is a potential theoretical basis for managing a particular
variant of the supply chain, namely a sustainable supply chain.
Because you can talk about the hypothesis that the future paradigm of economic
activity is so-called sharing economy, therefore the question of whether and how can
the sharing economy be the theoretical basis for a conceptual reference to supply
chain management is considered the basic problem of the presented study. The study
consists of three basic fragments. The first one is devoted to the characteristics of a
sustainable supply chain, the second one deals with the issue of sharing economy and
its consequences for the management process, and the third points to the relationship
between both these concepts The supply chains are in a state of transformation.
Sustainability will be of paramount importance in supply chain. A new wave of
factory automation (Industry 4.0 and Logistics 4.0) will be supported by the next
generation of low-cost robotics. The transformation of the supply chain of today to
the supply chain of the future is an enormous task. The better we understand the
future needs, the better smart and sustainable supply chain will function.
2 Sustainable Supply Chain Management
2.1 Contemporary Supply Chains in the Context

of the Economics of the Sustainable Development
As a result of the progressing process of the liquidation of barriers among enter-

prises and going beyond traditionally formed relations between contracting parties,
the first forms of connections which later were called supply chains started coming
into existence. Even though, at first, enterprises focused their attention mainly on
the reduction in supplies, quickly other processes occurring between them started
optimizing it. Within several dozen years notion “supply chain” waited a lot of
diverse definitions, often not very cohesive. Some authors treat the supply chain as
the sequence of activities performed one by one by all sorts of enterprises. An exam-
ple is an European Committee definition for Standardization which is showing that
the supply chain is a sequence of processes carrying the value added into the product
in the time of its flow and processing from raw materials, through all indirect forms,
all the way to form in accordance with requirements of the final customer (Łupicka
2004). Organization APICS (The Association for Operations Management, earlier
American Production and Inventory Society Ctrl) bearing in mind the complexity of
processes occurring in the supply chain and their sequential, but also parallel char-
acter supply chain as (www.apics.org, 2018): processes reaching the consumerism
of the ultimate product from the moment of obtaining initial supply materials and
combining the supplier and the recipient and functions inside and outside the enter-
prise which they enable for the value of chain to produce products and to provide
customers with services. Some authors treat supply chain as concept, or even philos-
ophy, and they often also add a flow of knowledge and innovations. Implementing
Sustainable Supply Chain Management in the Perspective … 123
new ideas within the confines of the supply chain is connected with transforming
of previous model of cooperation between enterprises as a result of the civiliza-
tional development of world and the growing threat to the natural environment. The
activity aimed at the environment-friendly development is being strengthened in the
awareness of societies already for over 30 years. In activities which are supposed to
ensure biosecurity, it is possible to distinguish two courses. First one is concentrating
on the environmental protection, ordering the need for the elimination or reducing
the threats caused by the contamination and environmental pollutions, second is
expressing the perspective thinking it is pointing out to the need for the amendment
of a hierarchy of values and action which will lead to eliminating of threats (idea
of the sustainable development) (Cała-Wacinkiewicz et al. 2010). In our times, a
supply chain is not only managing the flow of logistic streams and their physical
flow, but also the achievement of the goals associated with environmental and social
aspects and with relations which are occurring between individual entities of the sup-
ply chain. Apart from decisions concerning orders, environmental aspects should be
taken into consideration at the realization of transport functions, stock operations, and
the accumulation of waste. The idea of sustainable development in a harmonious way
is linking the ecological, economic, and social order in contemporary supply chains.
The sustainable development is being defined as “right to fulfill developmental aspi-
ration of the current generation, without limiting rights of future generations to meet
their developmental needs”. More widely—it is “process of changes, in which using
resources, direction of investing, the sense of direction of the technological devel-
opment, and institutional changes are harmonized and are increasing both current as
well as future potential for satisfying the needs and human aspiration” (Short 1992)
At implementing of the concept economics in supply chains, one should remember
that economy of sustainable development permits in its assumptions a possibility of
the market failure and a need for state interferences into various mechanisms of the
activity of companies. The given attitude is aimed at stopping action which could
be taken by the state and which would force market participants intended for the
good in order to resign from the benefit of future generations what is a superior
principle of the concept of sustainable development (Rogall 2010). Adam Smith has
already written in his works that the development of the economy was possible at the
intensive development of infrastructure (communication, education, etc.) through
the state. Unfortunately his pupils disregarded his theses and ignoring the activity of
the national politics suggested by A. Smith prevented the concept from the develop-
ment of sustainable development. Many years later with social and environmental
increasing problems, the science returned oneself toward sustainable development.
The sustainable development became a global strategy, for which the basic challenges
are energy saving, limiting harmful broadcastings, effective using all resources,
keeping human resources, and proper use of the space and the social agreement.
A source of distinguishing sustainable development as the challenge of civiliza-
tion is a phenomenon of the intensifying imbalance between the social–economic
development and the state of natural resources what is bringing a major risk of
the economic, ecological, and social and political instability. A measure of this
inequality is ecological footprint which is a synthetic indicator of the demand for

sources of the earth. This track within 45 last years underwent the reduplication, lean-
ing in 2007 from the level of the ecological balance about close to 50% (Pietrewicz
2011).
2.2 Managing the Sustainable Supply Chain
In the literature, a notion of managing the sustainable supply chain (Sustainable

Supply Chain Management—SSCM) is current for over 10 years. In SSCM literature,
the inclusion of sustainability into the theory of SCM is most often based on the triple
bottom line (TBL) approach which calls for equal consideration of all three pillars of
sustainability, namely, economy, ecology, and society. Many different definitions for
sustainable supply chain and sustainable supply chain management practices exist,
starting from the concept of green supply chain management and related green topics,
with evident evolutions and variations over the years, as listed below:
1. Sustainable supply network management (Awasthi et al. 2014)
2. Supply and demand sustainability in corporate social responsibility networks
3. Green purchasing and procurement
4. Environmental purchasing
5. Green logistics and environmental logistics
6. Supply chain revision incorporating the multiplayer concept
7. Satisfying the triple bottom line (TBL) concept (Carter and Rogers 2008)
8. SSC and
9. SSCM (Seuring and Muller 2008).
The main aim of balancing the supply chain is creating the protection and the
long-term development of the environmental, social, and economic value in deliver-
ing products and services to the market (United Nations 2008). The above purpose
initiated the sweep of managing the sustainable supply chain, both in the context
of the new business model, as well as indicating managing the supply chain in the
closed terminus (close-loop supply chain) and of TBL (Triple Bottom Line) carry-
ing out the earlier approach of sustainable development being based on three areas.
Seuring and Mueller used the TBL concept in the sustainable management supply
chain model suggested by them. They divided the model SSCM into three stages:
strategic values, the structure, and processes occurring in the supply chain (Fig. 1).
Of course the model is universal enough, that can be used both in traditional analysis
as well as sustainable supply chains. The difference consists of noticing individual
categories of processes with respect to sustainable development.
Seuring and Mueller define SSCM as […] the management of material, infor-
mation, and capital flows as well as cooperation among companies along the sup-
ply chain while taking goals from all three dimensions of sustainable development,
i.e., economic, environmental, and social, into account which derived from cus-
tomer and stakeholder requirements. This definition takes TBL (Triple Bottom Line)
Fig. 1 Sustainable supply chain management categories and practices. Source Own study based
on Seuring and Mueller (2008, pp. 1–6)
into account, recognizes interorganizational information sharing as a key factor for

profound management, and furthermore, specifically includes the stakeholders as
an important part of SSCM. Sustainable Supply Chain Management (SSCM) is
defined also as the strategic, transparent integration, and achievement of an organi-
zation’s social, environmental, and economic goals in the systemic coordination of
key interorganizational business processes for improving the long-term economic
performance of the individual company and its supply chains.
Below a character sketch of individual areas is presented in the context of man-
aging sustainable supply chains.
Environmental values in the sustainable supply chain
From a perspective of enterprises and their supply chains, the concept shows the
sustainable development on economically justified, socially using acceptable, and
friendly to the natural environment resources in the destination of supporting its
development in the long term. A process of using the resources friendly to the envi-
ronment and transforming them isfound in a sustainable supply chain so that it is
possible to improve their incidental properties or to affect the recycling in the exist-
ing environment without harming it (Brdulak 2012). Environmental values are for
example the following regulations associated with environmental aspects of the con-
ducting business activities. Within the supply chain, it is possible to measure the
amount of secreted greenhouse gases, the energy efficiency, or the possibility of new
processing materials.
Social values in the sustainable supply chain
Among social values mentioned in the sustainable supply chains, it is possible to
distinguish honest employee practice, fair rewarding employees, abiding by labor
law and human rights, adherence to the principles of equality of rights, safety among
others on-the-job, not using for the child labor, not applying the employee slavery
as well as practice set for the cooperation with the local communities.
Economic values in the sustainable supply chain
It is possible to count to economic values fair conditions of contracts, timely paying
to the amount due, not using the economic majority toward partners in the supply
chain, building the relations based on the confidence, applying fair trade rules, the
appropriate spread of risk and liabilities in the supply chain.
Sustainability will be of paramount importance in the supply chain. The goals of
sustainability efforts will be materials, manufacturing processes, energy, and pollu-
tants attributed to manufacturing and logistics.
2.3 Causes of the Development of Sustainable Supply Chains
Basic causes of the development of stable concepts of supply chains both in theory
as well as in practice of the management are as follows:
1. Rejecting existing paradigms of economic studies. In conditions of the contempo-
rary functioning, economy gradual paradigm shifts are happening in the turbulent
environment, being characterized by great instability, uncertainty, and a discon-
tinuity of action of economic studies. More and more managers are approaching
the business administration in an intuitive way, in which the classical economic
theory is only a point of departure for creating new proposals, linking different
fields of study such as economics, psychology, sociology or ethics, letting solv-
ing contemporary problems, but first of all, enabling building stronger relations
with business partners. Many companies such as the Beiersdorf Group, the VW,
or the often described coincidence of the Mexican bank Grupa Financiero Serfin
are implementing improvements of the training program in the negotiation and
the psychological attempt at the management, being the source of the build-
ing confidence among cooperating companies (Wincewicz-Bosy et al. 2017).
The need for managing supply chains is forcing the holistic approach managers
into seeking solutions in the public and economic environmental aspects. The
requirement of the holistic approach is calling a lot of dilemmas of the theo-
retical nature to the development of the contemporary economy, and especially
pragmatic (Wojewódzka-Król et al. 2016).
2. New regulations. Regulations are imposing more and more high standards and
financial penalties for the harmful impact on the environment. For example,
influences limiting the level of the adverse impact of transport to the natural
environment are included in the idea of sustainable transport. According to the
OECD, environmentally sustainable transport system (environmentally sustain-
able transport system) is “which isn’t threatening the public health or ecosystems
and is meeting the transport needs according to principles (a) of using renewable
resources below the level of their ability to reconstruct and (b) of nonrenewable
stores below the level of development of their renewable substitutes” (Environ-

mentally Sustainable Transport 2000). Next the White Paper of Transport 2011
clearly shows the modernization the transport to the plan in Europe to the year
2030/2050. European Federation is defining components of the sustainable trans-
port for Transport and Environment. According to that it is possible to regard
sustainable only when it is meeting four conditions of the environmental aware-
ness, the economic optimum, social grounds, and the political responsibility the
transport (Wojewódzka-Król et al. 2016).
3. The development of new technologies and the 4.0 industry. Supply chains are
inherently complex and dynamic systems (Surana 2005). In a web-based global
business arena witnessing Industry 4.0, collaboration across SC partners has to be
smart, innovative, and socially responsible to form value-creating networks. So,
one can see a different kind of supply chain emerging. It is possible to envision a
supply chain of the future: (1) The supply chain will be incredibly complex and
dynamic. Integration of sustainability principles will increase the complexity;
(2) Information will increasingly be machine-generated (instrumented); (3) The
whole supply chain will be connected. The supply chains take interaction (with
customers, suppliers, and IT systems in general). It seems a more holistic view of
the supply chain, this extensive interconnectivity will also facilitate collaboration
on a massive scale (interconnected).
4. Growing environmental awareness of the society. Comprehending the environ-
mental awareness is being considered in two dimensions. In broader meaning, an
entirety means acknowledged ideas, the value, or also an opinion on the environ-
ment as the place of the life of man, together shared by particular social groups
in the given period. In narrower meaning, it is a state of knowledge, views, and
conceptions of the role of environment concerning people in the life of man,
[…], as well as state of the knowledge about ways and tools of managing the
use, the protection, and the forming of the environment (Poskrobko 2007a, b).
Enterprises which noticed the trend of the change of perceiving the environment
by consumers are changing the manner of delivering goods and their production
in a more environment-friendly way.
5. Purchasing and the conversion of the knowledge. Knowledge is one of the most
decisive factors capable of offering competitive advantages for supply chain part-
ners. Some authors (Christopher 1998) recognize the need for cooperation and
stress the establishment of closer, long-term relationships as a way to construct
increasingly efficient and responsive supply chains. One can maintain that sup-
ply chain partners engage in interlinked processes that rich information sharing
and building information technology infrastructures to process the information
obtained from partners, a scenario that create new knowledge (Capo-Vicedo
et al. 2011) with supply chains it is necessary to form a relationship or deal
with organizations with very different experiences, languages, and contexts. This
implies new organizational ideas, plus an environment of loyalty and trust and
collaboration between the enterprises in the supply chain which facilitates knowl-
edge creation and distribution. To obtain advantages from knowledge sharing,
it is strategically important that firms understand the factors affecting partners’

knowledge sharing behaviors (Cheng et al. 2008).
6. Possibility of the cost cutting. Along with the need of seeking the cost cutting,
new concepts are developing of business administration. However according to
the J. K. Galbraith (Noble prize winner), action connected with the environmental
protection “by their nature are in conflict by force incentive of market economy”
(Pietrewicz 2011). And so enterprises and the entire supply chains are imple-
menting concepts of narrow management in order to eliminate the waste of the
space, the stores of the production, or the time of producing and delivering for
the ultimate customer.
7. The policy of image. The sustainable supply chain is a result of combining envi-
ronmentally friendly management with cost-efficient solutions. It is particularly
important in the case of energy-intensive and material-consuming parts of the
industry in which a large quantity of waste is occurring (Brdulak 2012). In order
to increase the competitiveness, companies are using many different tools influ-
encing their environmentally friendly image. An example of such tools can be
tools dedicated to IT. For instance, SEDEX (Supplier Ethical Exchange Date)—
platform of the exchange of data associated with managing the sustainable supply
chain. It enables an accumulation, publicity, and reporting information coming
from suppliers which are divided into four main categories: standards of the
work, health and safety, the environment, and business ethics. A further exam-
ple is SHDB (Social Hotspot Database)—base dedicated to the widest spectrum
of recipients, offering transparent information about the social risk and diverse
possibilities for cooperation business (Tundys 2017).
8. The network effect and new models of collaboration. Along with diverging of
enterprises from the traditional model of collaboration functioning in formal
and hierarchical structures, new models of collaboration based on changing rela-
tions between companies, consumers, and markets are formed. Prahalad and
Ramaswamy acknowledged that the new model of collaboration involves the
new approach for value creation, based on contributing it by customers’ and
companies’ contribution. Whereas Tapscott researchers and Williams claim that
a new model of collaboration of the organization and stakeholders which is lead-
ing to the change of the way in which companies and societies are using the
knowledge and the ability to the value creation. New opportunities to billion
people who are giving access to the Internet were considered, in order to take an
active part in innovative processes, to create the common value, and to contribute
to the social development. On the other hand, the network effect is about the more
knots have a network, the more membership in it is benefitting individual knots.
For example, the additional knot in the social network is increasing its value and is
encouraging disabled users for joining (Szumniak-Samolej 2013). Supply chains
implementing the concept of sustainable development cannot forget about power
of Internet, social media, which are encouraging potential prospects. From the
other side, using web applications, lets consumers reading environment-friendly
and public shares fulfilled by companies.
3 Sharing Economy and Management Based

on Cooperation—Genesis and Content
Recently, we can talk about the growing popularity of the emerging new concep-
tual proposal justifying a new look at economics and management. Jeremy Rifkin
identifies this theoretical innovation as a collaborative economy (Rifkin 2016). The
cornerstone of this theory is the so-called common good or “collective value achieved
by human communities in connection with the development of the natural capabilities
of their members, satisfying their individual interests or respecting their individual
rights, while taking care to bring the whole community closer to its proper purpose”
(Dobro wspólne, Encyklopedia PWN, 18 Oct 2016). The explanations derived from
scientific research on the common good turn out to be an effective idea for the orga-
nization of the economy and management of its resources (Słodowa-Hepła, 18 Oct
2016). Rifkin points out that the projects of deregulation of economic systems pro-
moted since the early 1980s and the privatization of the best use of all resources,
including resources that are common goods, should be interpreted as a renunciation
of responsibility by governments for creating welfare and well-being of societies
(Rifkin 2016). The effect of many years of efforts turned out to be alarming because
“the private sector has caught and devoured, with one huge gulp and in the blink of
an eye, most of the profitable riches on the planet, changing into a corporate power
that can easily handle any challenge thrown into its power” (Rifkin 2016).
Leading researcher of common goods, Elinor Ostrom presented, as the result of
her many years of research, the eight most important assumptions of dealing with
these goods by social communities. They are namely (Ostrom 1990)
1. Clear boundaries. Entities entitled to use the common goods are clearly indicated,
as well as the collection of these goods;
2. Clear definition of time, amount of resources, and acceptable methods of their
use;
3. Ensuring common creation of rules regulating the exploitation of common
resources and ways to change these rules;
4. Clear indication of persons controlling compliance with established rules, which
should be derived from a community that exploits common goods;
5. The gradual nature of penalties for breaking the established rules, i.e., their
transparency and the degree of discomfort that will not prevent the necessary
participation of those punished in shaping the success of the community;
6. The existence of procedures and institutions allowing for quick and inexpensive
resolution of emerging conflicts;
7. Far-reaching autonomy of the community manifesting its relative independence
from the authorities;
8. Nesting the community in the superior system.
The approach proposed by Ostrom allows us to state that “although the common
good may contain various material and immaterial resources, it cannot be equated
only with resources, as it is unfortunately the case. The paradigm of the common good
includes three elements that form an integrated, interdependent whole: resources,

community and a set of principles, values, and norms” (Słodowa-Hełpa, 18 Oct
2016). This means that the conceptual category of the common good includes not
only specific material resources but also social outlook and attitudes (culture). On
this basis, a new way of farming emerges that can be called a model of sharing
economy.
Different authors variously define this new economic phenomenon (e.g., Jastrzeb-
ska and Legutko-Kobus 2015). Rachel Botsman believes that the sharing economy
is “a system of decentralized networks and markets that unlocks the hidden value of
underutilized resources by matching those in need who have been bypassing tradi-
tional intermediaries.” On the other hand, the OuiShare platform indicates that they
are “initiatives based on horizontal networks and community involvement, based
on energy and community trust, in opposition to centralized institutions, blurring
the boundaries between the producer and the consumer, where interactions take
place via Internet networks and P2P platforms as well as shared spaces.” According
to English Oxford Living Dictionaries, sharing economy is “an economic system
in which assets or services are shared between private individuals, either for free
or for a fee, usually via the Internet” (https://en.oxforddictionaries.com/definition/
sharing_economy, 19 Oct 2016). This system consists of starting goods recirculation,
increasing the use of assets, exchanging services, and making production potential
available. An example of recirculation of goods can be bookcrossing box, that is,
public wardrobes or bookshelves that anyone can put books on (sometimes a specific
genre for which the bookshelf is dedicated) and take books placed by another per-
son. A copy of the book is not stored in a private library but is read by subsequent
users. An example of increasing the use of assets is the joint use of vehicles (car
sharing), primarily passenger cars, to move from their place of residence usually to
the workplace. It is a kind of a neighborly agreement to use only one vehicle instead
of several carrying individual passengers. It is also possible to use group journeys
for a distance for a fee. Then, the most common mating of passengers takes place
using online social platforms. Mutual exchange of services usually takes the form of
the so-called time banks. For example, using a moment’s time, someone washes a
window at another person, and this one, in a way, repays this service in his free time
by giving a child private tuition. Finally, sharing production potential can consist
of paid or free permission to use tools or machines for anyone who wants to do
some work, usually not necessarily for their own needs. These are, of course, only
examples, the list of which could undoubtedly be significantly extended.
Cooperative projects can be both commercial and noncommercial. In the first case,
they can rely either on the intermediation of transactions between their parties and the
remuneration is than the commission (example of Airbnb) or on direct contracts at
a fixed price (Zipcar example). If the sharing economy projects are noncommercial,
they rely either on the barter and direct exchange of goods or services (for example,
time banks) or on creating opportunities for such exchange (example of a cross-box).
The report prepared by the consulting company Ernst and Young gives the fol-
lowing factors as reasons and benefits of the dynamic development of the sharing
economy (The rise of the sharing economy 2015):
1. More use of available resources. The opening of the potential of the various
institutions to ideas and use by innovative and motivated people allows for better
adjustment of the supply offer to the effectively reported demand. Thanks to this,
the unprofitable stock of finished products is also liquidated.
2. Creating new jobs. In particular, enterprises can react much faster to changes
in demand, which allows for more intensive use of live work, including more
frequent employment of employees. Job opportunities appear even in regions
where employment has so far been difficult to find.
3. Increasing social mobility. Opening the possibility of using the existing business
potential triggers the entrepreneurship and innovation of many people. In this
way, a large group of micro-entrepreneurs is created who start their own business
activity on the basis of self-employment.
4. Support for competence development. Professional and economic activation cre-
ates opportunities for gathering experience and motivates people to improve their
skills through education and professional training.
5. Creation of more favorable conditions for business. It is easier for entrepreneurs to
change their ideas for finished products. In turn, customers have the opportunity
to find an offer that meets their requirements easier.
6. Building transparency of business activity and financial settlements. Contractual
transactions and barter exchanges take place under conditions of full disclosure
and none of the parties to the contract is in a privileged position toward the other.
In view of the complexity and multifacetedness of activity models within the
sharing economy, diagnosed by Codagnone and Martins (2016), however, slightly
modifying their proposition, the characteristics of economic activity in this paradigm
can be presented as in Fig. 2.
Fig. 2 A map of economic activities in the paradigm of sharing economy. Source Own study
Regardless of the logic of economic activity determined by the pursuit of profit or

not, in relation to other business partners or to final users, it is necessary to manage
this activity in a special way adapted to the conditions of the sharing economy. We
can name them—after OuiShare—for horizontal and open management. Horizontal
management consists of coordinating and synchronizing a set of actions between
two or more organizational units, in which these units have no hierarchical control
over themselves and whose goal is to generate results that cannot be achieved if they
operate in isolation (Gagnon 2018). In turn, open management consists in increasing
the dynamism of an innovative company by creating the possibility of using both
own and external resources (Lindergaard 2018).
Relying on the views of Rosabeth Moss-Kanter, it can be said that open man-
agement means that companies should be oriented toward three main directions of
action (Burnes 2004):
1. Continuous restructuring to create synergy. The basic value for this restructuring
should be concentrating all resources on their most effective applications. In
other words, this means striving to identify one’s core business and outsourcing
other activities. In addition to efficiency gains, an important consequence is the
leaning of the administrative sphere, the elimination of bureaucratese, and the
improvement of the general working atmosphere.
2. Opening organizational boundaries for strategic alliances. This pursuit is a con-
sequence of focusing on the core business. Outsourcing of collateral activities
forces the development of cooperation with many business partners who them-
selves should be very effective in their area of activity. These alliances can have
a threefold form: service, opportunist, and interest. The service alliance is con-
cluded between partners who alone could not implement any business projects.
This may be due to either a combination of unique competencies, or risk diversi-
fication, or the pursuit of dominant market share, etc. The opportunistic alliance
is about gaining access to unique competencies, breakthrough technologies, or
an attractive market. He points out that, unlike the previous type, this alliance
is not mutually beneficial—one partner always gains more. Finally, the essence
of a friendly alliance consists of a lasting cooperative relationship with business
partners connected by common economic interest. It is usually associated with
suppliers, recipients, or distributors.
3. Creation of new ventures from the company’s interior thanks to innovation and
entrepreneurship. In a classically operating enterprise, the development of new
products and new business ventures is the domain of specialized planning and R
& D departments. This is a typical silo system. Even important innovations can
hardly penetrate the construction silos. Therefore, the inclusion of all employ-
ees in the process of creating innovation is encouraged so that their ideas in
an emergent way constantly improve the methods of operation and allow for
the launching of innovative directions of this activity. This is obviously condi-
tioned by the development of a culture of entrepreneurship strengthened by a
pro-innovation system of remunerating employees.
Fig. 3 A map of company management models. Source Own study
Having the above in mind and using the idea of Lica Boyer and Noel Equilbey,
the relationship between horizontal and open management of the enterprise and
the requirements of the sharing economy can be illustrated as in Fig. 3. On the
horizontal axis, the closed (autarkic) or open nature of business management is
awarded. The first consists of the pursuit of administrative control over the largest
possible area of economic activity, and the second—focusing on the core business
and the pursuit of forming alliances with external partners. In turn, on the vertical
axis, the synoptic or emergent nature of management is awarded. Synoptic consists of
a strictly planning approach developed from the top of the organizational hierarchy
to its lower levels. The emergent character is expressed through empowering all
employees and stimulating them to develop initiative and ingenuity.
The bureaucratic and participative management of an autarkic company assumes
that the greatest benefits result from economies of scale and scope. Economies of
scale allow to spread fixed costs on an increasing number of products and thus
reduce their costs and unit prices, and this leads to strengthening the competitive-
ness of the company. The economics of the scope consists of enriching the product
offer with new product items, which also allows the spreading of fixed costs on a
growing number of products. The bureaucratic form of this management assumes the
omnipotence of the management and it is the responsibility of the company’s current
and future financial results. The participation variant recognizes the potential of the
total employed and builds remuneration systems that reward employee creativity.
Both types of management support neoclassical economic doctrines, only that in the
first case, on a more orthodox interpretation of them, and in the second—on a more
humanistic interpretation.
Bureaucratic management to capture profit margins of business partners refers to

the concept of industry economics and strategic management to a large extent. The
key here is the explanation proposed by Michael Porter known as the five forces of
competition (Porter 1992). The primary goal of enterprise management is to max-
imize profit, and one of the possibilities to build a transactional advantage over
business partners that allows you to capture the financial surpluses they have devel-
oped.
Entrepreneurial management in order to create benefits for all business partners
derives precisely from the concept of sharing economy. It assumes a fully autonomous
status (independence) of cooperating partners who can derive economic benefits from
this cooperation. The condition is a guarantee for a long duration of this coopera-
tion because it allows mutual adjustment (increasing the specificity of resources
(Williamson 1994) which results in a reduction of the operating costs. Empower-
ment should be implemented on two levels. First, for all employees and, second, for
companies in mutual cooperation. Of course, other economic benefits are expected
by enterprises participating in the supply chain, and others—final consumers. For the
company, the exchangeable value that comes to the forefront, which translates into
sales revenues and, consequently, profits. For others—the use value satisfies their
needs and requirements as to the form of the product, the time and place of its receipt
and the cost of acquisition.
4 Premises for Creating a Supply Chain Management

Model with Sustainability and Sharing Features
The proposed model assumes that supply chain management is implemented due to
three equivalent optimization criteria, closely related to the TBL approach. First of all,
it is an economic criterion. Due to the common view in the literature, it is assumed that
“the goal of the company’s activity in a market economy is to maximize the benefits
of ownership. (…) The value of the enterprise is the measure in which maximization
is synonymous with maximizing the benefits of its owners.” (Czeka et al. 1997) In this
interpretation, the market value added (MVA) is the most important factor, i.e., the
surplus of the market value of the enterprise over the value of the capital invested in
the enterprise. Striving for maximization of MVA requires that in individual periods
of economic activity, the aim is to maximize the difference between operating profit
after tax and the total cost of capital (own and foreign). While the assumption is
understandable in relation to the management of one enterprise, it creates a problem
in the case of supply chain management that is the activity of several enterprises.
Maximizing the MVAŁD of the entire chain is not the sum of the MVA maximization
of each of its companies. It is necessary to reject the parasitic model in supply
chain management and adoption of the symbiotic model. In this model, striving to
maximize the market value added of each of the chain-making enterprises requires
the development and implementation of a special financial mechanism to compensate
the effects of suboptimal decisions in individual enterprises in order to maximize the

market value of the chain as a whole. This action undoubtedly requires cooperation
and sharing of financial resources.
Second, the ecological criteria should be equivalent to the economic one. Here,
the basic premise can be the minimization of the ecological footprint. The ecological
footprint is referred to as the land or water area that is required to sustain the human
population. It is, therefore, a measure of the size of the planet’s natural resources
used in the perspective of the process of their reproduction by the forces of nature
(Lowellyn 2015). The principle of not creating a deficit in this area requires the
application of philosophy and a policy of sustainable development, i.e., striving
not to deprive environmental capital and respect the interests of future generations
(Domański 1992). However, the operationalization of the ecological criterion (Ke )
requires finding a calculation formula that would measure the results and changes
in the economic activity of the supply chain as a whole. Referring to the proposal
of Kimio Uno, discussed by Parteka (1997) and referring to the specificity of the
supply chain, it should, in the reception field of such calculation formula, include
the quotients of space (P) and employment (Zt), quotient of economic value added
(EWD) and employment (efficiency level), quotient of balance sheet assets (AB) and
employment. (load on resources), and the contamination quotient (Zn) and balance
assets (creation of negative, economic external effects).

Ke = P Zt × EWD Zt × AB Zt × Zn AB
These factors are formulated in other units so that a standardization of measurement

is necessary.
Finally, in the social criterion, it is essential to meet the needs of people involved
in the economic activities of the supply chain as a whole. It is the satisfaction of needs
that is the cause of happiness (Poskrobko 2007a, b). The onion theory of happiness
of Jan Czapiński can be particularly helpful which (Czapiński 2001) assumes a
three-level structure of a sense of happiness: the deepest layer is associated with
the will to live, the intermediate layer is related to the so-called subjective well-
being, i.e., a positive emotional balance resulting from existence, and finally the
most surface layer is partial satisfaction, i.e., everyday joys from current experiences.
This allows to propose a criterion related to the shaping of logistics processes and
devices in the supply chain in a three-level system. In the first place with the highest
significance index, it is a measure of respect for the will to live Wż = Z + W +
H + Ś + E + B, where Z is a measure of pollution, W—accidents, H—noise, Ś—
ecological footprint, E—ergonomic adjustment, and B—biodegradability. Bringing
these quantities to common units of measure also requires standardization. Second,
the average significance is the synthetic index of subjective well-being Ds = T,
where T is the time of employee participation in company management measured
as percentage points in relation to the total time spent at workplaces. Finally, in the
third place, that is with the use of the smallest significance index, it is a synthetic
indicator of participation in deciding on solutions of processes and logistic devices
in the supply chain (Pd) as measured above in percent as above. The three levels of
individual indicators can be obtained by assuming weighting factors with values of

0.55, 0.33, and 0.12. Such quantities result from the assumption about the normal
distribution of people’s feelings and the hierarchical diversity of the determinants of
happiness. A comprehensive assessment of solutions in the field of logistics processes
and devices in the supply chain (QLM ) can be presented as below:
QLM = 0.55 × Wż + 0.33 × Ds + 0.12 × Pd
Therefore, the optimal shaping of the sustainable supply chain management (SZZŁD)
system should fulfill the following function:
f (SZZŁD) = {MVAŁD + Ke + QLM }(SZZŁD)
In turn, the sustainable supply chain management system is composed of variable

components, as indicated above in the areas proposed by Philip Beske and Stefan
Seuring, i.e., strategies, structures, and processes.
Of course, among the set of available supply chain management strategies, those
that meet the criteria presented above should be preferred. “Supply chain man-
agement strategy is based on synchronization of demand and supply, using assis-
tive technology” (Baraniecka 2008) According to the proposal, Sylwia Konecka, a
specific map of potential supply chain management strategies is presented in Fig. 4.
The map is three-dimensional and uses three criteria. First of all, the criterion of
the uncertainty of demand is determined by the possibilities of predicting market
reactions to the product offer. These products can be either functional (standard),
for which demand is stable, i.e., predictable, or innovative (innovative), for which
demand is difficult to forecast. Second, it is a volume criterion, i.e., the volume of
Fig. 4 A map of the potential supply chain management strategies. Source Own study based on
Konecka (2011, p. 1099)
production and sales. Finally, the third criterion is the preferred competition strate-
gies distinguished according to the taxonomy proposed by Michael Porter, i.e., either
a low-cost strategy or a distinction.
Among the potential combinations of management strategies, you can indicate
three of their ideal types
1. The lean supply chain management strategy:
This strategy is suitable in situations of relatively high predictability of demand,
which allows to focus on the effect of the scale of production, which results in
competition due to low costs. The product offer is therefore standard and it allows
to push the manufacturer’s offer through distribution channels.
2. The agile supply chain management strategy:
This strategy is suitable in situations of relatively low predictability of demand,
and this requires an individualized approach to clients (customization) and results
in competition thanks to distinction. The product offer, therefore, contains inno-
vative products, which forces the attraction of both sales agents and final con-
sumers.
3. The hybrid supply chain management strategy:
This strategy is suitable in situations of relatively low predictability of demand
but the total delivery time is quite long. As products usually have a modular
structure, the method of postponing the product to the recipient may be applied
until the order appears. Properly locating the decoupling point allows to combine
the effects of leaning and variability, as well as competing with low costs.
Considering dependence (SSCM), the hybrid strategy is the most appropriate
strategy for sustainable supply chain management. This is because
1. Due to the Ke criterion, this strategy allows for the widest use of the mass produc-
tion system and thus for very high work productivity and productivity of fixed
assets,
2. Due to the MVA criterion, this strategy allows to maximize the profit margin in
the long period,
3. Due to the QLM criterion, this strategy allows the creation of very human-friendly
working and living conditions.
Remembering the dependence demonstrated by Alfred Chandler that organiza-
tions achieve high efficiency only when they adapt their organizational structure to
the implemented strategy (Chandler 1962), the question arises as to the best adapted
organizational structure for the hybrid sustainable supply chain management strategy.
According to Jean-Pierre Helfer, Michel Kalika, and Jacques Orsoni, it is assumed
that this requires answering five fundamental questions about the way of special-
ization of activities, the way of dividing power, the nature of decentralization of
decisions, the method of coordinating activities, and the way of balancing differen-
tiation with integration (Helfer et al. 1998).
The specialization of the activity, in other words, it is called the division of
labor between enterprises that makes the supply chain can be of a different nature.
However, because the supply chain is by definition created along the technological
and operational process of adding value to the manufactured products, it is a division

determined by the requirements of this process. Some units of the chain specialize in
functions and tasks carried out for other units, others according to established tech-
nology of activity, and still others according to implemented projects. In principle,
this division of labor is characterized by a relatively high degree of freedom, which
is the result of the principle of open management.
The division of power is more important than the division of labor because it
creates opportunities to apply the principle of horizontal management. There is a
dilemma of seeking a balance between striving to create a chain leader who can form
a vision of activity and give the chain development speed. It is an issue closely related
to the process of increasing the integration of the supply chain discussed below. It
can be assumed that the principle of subsidiarity should be applied, i.e., adopt a
policy of service and supporting the activities of the center of power in relation to
the federation of enterprises that make the supply chain.
The same is true for the decentralization of decisions between units of the chain.
It is not possible to implement a system of total decentralization if the center of
power is able to perform its tasks. The best rule is selective decentralization that
is concentrating some decision-making powers in the central authority center and
leaving the remaining decisions in the chain companies as close as possible to the
problems that need solving.
Among the available instruments for coordination of activities, the most effective
in regulating the activities of the chain’s enterprises is standardization. Different
areas of economic activity may be standardized, but the standardization of results is
of key importance. These standards are the message of the recipient to the supplier
with the required product parameters (items or services). If it is important from a
technological point of view, then the procedures implemented in the chain companies
can also be standardized.
Another important solution is to find a balance between the diversification of
the chain’s business profile and the level of its integration. Diversification results
from existing specialization, and integration necessitates coordination. The desired
strategy is determined by the chain strategy, the industries in which the chain’s
companies operate and the nature of the competitive environment.
As a result of the above decisions, the organizational structure of the supply
chain takes a specific form. According to the proposal of Henry Mintzberg (B˛ak-
Sokołowska 2015), it should probably reject the extreme forms, which he identifies,
i.e., the simple structure (because it characterizes small enterprises) and the adho-
cratic structure (because it means organizational atrophy). The three others should be
considered. First of all, the structure of the industrial bureaucracy in which specialists
employed in staff cells play the leading role. First of all, the structure of the industrial
bureaucracy in which specialists employed in staff cells play the leading role. This
structure works well in a stable and uncomplicated competitive environment and
in relation to externally regulated business activity. Second, the structure of a pro-
fessional bureaucracy in which professionals responsible for production processes
play a leading role. This structure works well in a stable but complex competitive
environment. Third, the departmental structure, in which mid-level managers play a
leading role. This structure works well in a complex competitive environment with
strong diversified outlets.
Adapting the structure of the supply chain to hybrid strategies is taking place
among others under the influence of changes in the economy according to the TBL
concept and the economy of the sharing. These two concepts due to widely compre-
hended integration are permeating structures and processes occurring in the supply
chain. The integration of the supply chain is the base of the contemporary logis-
tic management at present. Issues of the management integration logistic are going
beyond the formal bounds of single companies and entire groups of enterprises,
operating in the supply chain. Through the interrelation of stores, the ability, pro-
cesses, and the strategy, initiating the process of the integration of the whole chain is
possible. A great significance has a correct evaluation of stores, or abilities being a
strategic key in achieving competitive superiority. It means that enterprises forming
the supply chain in the given industry should seek the concept and aiming solutions
to the full integration (Łupicka 2004).
Developing a conception and the plan of changes in the enterprise being aimed
at creating the integrated supply chain is the greatest challenge. Ensuring that the
developed plan will be possible to implement requires the comprehensive look at all
areas of the process of the supply chain logistic, including purposes, the possibility of
all those present and future partners which will be the links integrated about features
of balancing and sharing.
In the supply chains, it is possible to divide integration on Table 1:
1. Internal—integration with reference to sustainable development and the sharing
economy is obtained due to the strategy and the organizational structure.
2. External—integration concerning the cooperation with stakeholders of the supply
chain with reference to the social, economic, and environmental risk shared
initiatives of sustainable development and sharing economy.
Table 1 Determinants of the sustainable supply chain with reference to three types of integration
External integration Internal integration Operational integration
• Dialogue with stakeholders • Defining the purposes of • Audits
• Market position the sustainable • Certificates
• Readiness of the payment development • Sharing information
for the sustainable • Trainings in the sustainable • Market position
development development • Availability of financial
• Public, environmental, and • Managing the social, resources
economic risk assessment economic, and • Time constraints
environmental risk • Innovations
• Knowledge • Public, environmental, and
• Availability of human economic risk assessment
resources • Extending the life cycle of
products
• Innovations
Source Own study with the application: Wolf (2011, pp. 221–235)
3. Operational—integration concerning shared programs with suppliers, the man-

agement of the relationships with clients, the manufacturing process, or the pro-
cess of the recycling in order to take environment-friendly and prosocial action.
For the purpose of the implementation of features of the sustainable development
and sharing in supply chains apart from adapting the strategy and the organizational
structure, peculiarly managing logistic processes and their integration are playing
an important role in the internal and operating levels. Many skeptics certainly will
recognize that the minimum price, the maximization of profits, and the minimization
of costs aren’t harmonizing with environmental-friendly or social slogans. However
at present, we are dealing with turning away the value chain, in which the consumer
is the most important entity. According to M. B˛ak-Sokołowska, in the context of
growing, consumer awareness is gaining great importance building the responsible,
integrated product, for which at all stages associated with, it’s coming into existence
and spreading are taken into account (of course apart from economic aspects), public
and ethical environmental aspect. It confirms the fact that in 2013, the Unilever
company conducted research in 11 countries which demonstrated that three fourth
of the consumers more willingly would buy product, knowing that it was produced
out of raw materials acquired according to principles of the sustainable development
(B˛ak-Sokołowska 2015). The supply chain with features of sustainable and sharing
is regarding all processes occurring in it whose concept is shown in Table 2.
Table 2 Component parts of supply chains with features of sustainable and sharing
Supply chain with features of sustainable and sharing
Sustainable and Sustainable and Sustainable and Sustainable and Sustainable and
shared orders shared shared shared transport shared opposite
Proper selection production distribution Optimal use of logistics
of suppliers Balanced Design changes the capacity and Integration of
often local or recruiting of raw of the product the space of Eco logistic
neighborly materials and packages vehicles links
Reducing the Frugality of Wider using of Reducing the Maximization of
number of stores renewable exhaust the recovery of
suppliers Strategic materials emission waste
Integration of alliances of Reusability of More effective Rationalizing
marketing producers similar packages managing technical,
processes, the Accustoming Limiting transport means technological,
transport, and suppliers into intermediaries of transporting and logistic new
the production the in delivery The decisions solutions waste
Purchase of manufacturing channels concerning the disposal
materials and process location of Friendly
raw materials logistic centers environmentally
acquired Implementing forms of the
according to transport recycling
environmental strategies
norms
Integration on the internal, external and operating level
Source Own study
Sustainable and shared orders

Orders are being executed with a smaller number of suppliers to the purpose of the
improvement of the quality and the cost cutting, often neighborly and local what
is curbing the unnecessary transport. Moreover, integration of marketing processes,
the transport, and the production will influence more effective order processing, for
example, producing concentrates will cause reducing the importance of the transport
and can lead to CO2 emission reduction. The purchase of materials and raw materials
in accordance with environmental norms will influence in reducing their harmfulness
for the environment.
Sustainable and shared production

More and more companies apply solutions in the production which are neutral for
the environment and are producing less waste. Next strategic alliances in relation
to producing some component or the module cause reducing using nonrenewable
raw materials and the sharing of costs of research and development. Accustoming
suppliers into a production process allows for joint using modern technologies, for
example, using big data for the transparency of the supply chain.
Sustainable and shared distribution

Design changes of the product or the package and wider using renewable raw
materials are having a positive effect on the corporate image and are encouraging
environment-friendly consumers for the purchase of these goods. Moreover applying
similar packages by producers and their standardization permit lending and reducing
the quantity of waste.
Sustainable and shared transport

Limiting the empty runs to minimum t, applying the respective parameters of the
capacity, and using lent containers influences the cost cutting and the optimization
of transports. In case of building the logistic canters close to the industrial parks, limits
the transport and hence the CO2 emission reduction takes place. Next implementing
transport strategies, e.g., of strategy pooling, whether creating platforms associating
carriers with customers allows for getting synergetic effects in the storage, picking
orders, and the transport. For example, in pooling, benefits can come out of the
reduction in the number of vehicles for relieving and in the process of reduction
in the number of employees, the better filling of the surface of cars and the better
availability of the fleet.
Sustainable and shared reverse logistics

The sustainable and shared opposite logistics is aimed at the recovery of waste and
its recycling. Integration of ecologistic links takes place along the entire supply chain
starting from mining companies, through entities collecting waste, organizations of
the recycling, being limited to governmental organizations and extra-governmental
dealing with issues of environmental protection.
5 Conclusions
The above reasoning proved that it is the sharing economy that is the theoretical basis
for shaping sustainable supply chain management. Interpretation of basic assump-
tions of the concept of sharing economy from the point of view of the management
process allowed to recognize the principle of open management and the principle of
horizontal management as the most important for the sustainable supply chain man-
agement. Subsequently, the problems of decision criteria in sustainable supply chain
management as well as structures and processes in this management were developed.
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www.apics.org, 24 Oct 2018
Simulation Modeling and Analysis
for Sustainable Supply Chains
Roman Gumzej and Miroslava Rakovska
Abstract In their decision-making supply chain management, specialists are usually

focused on some characteristic performance metrics that mainly influence the con-
struction of their decision support models and partly also the results. Many of the
supply chain issues affect the sustainability performance of companies. Since supply
chains are complex adaptive systems, appropriate modeling methods are required
to tackle their inherent complexity and lead to desired results that contribute to
the achievement of sustainable objectives. From the viewpoint of system theory,
they should enable the monitoring, analysis, and control of supply chains provid-
ing opportunities for system-wide integration. Since multiple views and layers of a
supply chain or multiple interconnected supply chains must be considered, different
modeling and analysis techniques are used to achieve the desired levels of detail. In
this chapter, three simulation modeling and analysis methods are assessed, consider-
ing their suitability to support decision-making in diverse supply chain management
problems and scenarios. These results are joined in guidelines for the construction
of coherent and consistent simulation models that would enable multilayered and
multifaceted analysis of common supply chain management problems and lead to
making decisions that efficiently utilize supply chain resources, shorten lead times,
and eliminate unnecessary waste.
Keywords Behavioral supply management · Decision support · Case studies ·

Discrete event simulation · System dynamics · Agent-based simulation
R. Gumzej
Faculty of Logistics, University of Maribor, Mariborska cesta 7, 3000 Celje, Slovenia
M. Rakovska (B)
Department of Logistics and Supply Chains, University of National and World Economy,
Studentski Grad “Hristo Botev”, 1700 Sofia, Bulgaria

146 R. Gumzej and M. Rakovska
1 Introduction
Decision makers in supply chains (SC) are often faced with strategic decision-making
challenges with only partial information on system structure and/or system operation.
Hence, adopted decisions may have a negative impact on overall SC performance.
These situations should be avoided and can be prevented by utilizing decision support
systems (DSS). DSSs enable business and/or organizational decision-making based
on rapidly changing data, not known in advance. By applying the holistic modeling
approach to capture the extended SC at a strategic, tactical and/or operational level of
an enterprise within a DSS the decision-making problem may be efficiently addressed
and solved (Rosi and Mulej 2006).
The supply chain is a metastructure (Grzybowska 2012), being an intermediate
form between a single enterprise (microstructure) and global economy (macrostruc-
ture). Identification of enablers of sustainability in the SC can help in deciding the
priorities to take regulatory steps pro-actively aiding in strategic, tactical, and opera-
tional decisions for a company wanting to create sustainability in the SC. According
to Grzybowska et al. (2014), collaboration planning is vital for achieving sustainable
logistics. In the course of these appropriate methods are needed to enable joining all
relevant views in a consistent and coherent whole.
As a network of organizations, the SC is obliged to have clearly defined objec-
tives. The main objective of an SC is the maximization of total profits derived across
different echelons of the SC. The second most important objective, however, is the
maximization of customer’s satisfaction, expressed by the service level (Zhang et al.
2011), also referred to as quality of service (QoS). While the majority of DST-based
approaches deal with the first objective only, the fulfillment of the second objective,
in our opinion, is interrelated with it and as such should be considered in conjunc-
tion (Angerhofer and Angelides 2000). On the other hand, sustainability in the SC
implies decisions and actions that lead to the highest economic and social bene-
fits while reducing environmental losses (Wang et al. 2017). Achieving all of these
objectives and also meeting the requirement for the SC to create customer value in
a flexible and agile way pose challenges to companies (Pereira 2009). They have
difficulties in managing geographically dispersed supply chains and in establishing
the communication and service links between SC entities in a seamless, timely, and
cost-efficient manner (Ip et al. 2011). Designing, planning, and operating sustainable
supply chains represent an even bigger challenge if companies have to achieve effec-
tiveness considering also economic, environmental, and social objectives (Ramos
et al. 2014).
The set goals can only be attained by adequate SC configuration and proper use
of management tools. The latter are addressed by supply chain management (SCM),
being the process of planning, implementing and controlling the operations of the
supply chain in an efficient way. SCM spans all movements and storage of raw
materials, work-in-process inventory, and finished goods from the point of origin to
the point of consumption (Behdani 2012). Meanwhile, the sustainability issues have
become increasingly important for organizations and have been rooted in a number
of managerial decisions related to SCM.
Simulation Modeling and Analysis for Sustainable Supply Chains 147
SCM addresses a wide range of problems, which may be divided into three cate-
gories (Georgiadis et al. 2005), considering their aspects:
• supply chain infrastructure (network) design;
• supply chain analysis and policy formulation;
• supply chain operations planning and scheduling.
Within the process of modeling and solving the indicated problems, managers have
to make decisions on different hierarchical levels directed toward integration of SC
processes within and between organizations and having an impact on sustainability in
supply chains. These decisions can be classified as strategic, tactical, and operational,
depending on their effects on the overall SC. Due to interdependence among the three
levels, SCM remains incapable of satisfactorily addressing many practical real-world
problems at a strategic level. Let alone that these levels are difficult to tackle at any
individual entity, due to inter-dependencies with other entities and their autonomous
behavior they are even more difficult to address. Hence, the majority of modeling
approaches in DST provide invalid results (Holland 1995). For obtaining adequate
solutions, decision makers need comprehensive models to guide them in the decision-
making process.
The purpose of this work is to study and assess the opportunities that simula-
tion modeling approaches, such as system dynamics, agent-based simulation, and
discrete event simulation, provide for managers to make decisions on different hier-
archical levels to improve the integration and sustainability of SC processes within
and between organizations.
System dynamics (SD), being a simulation-based modeling approach, which
underpins DST and holistic modeling (Shah 2005), is widely used in logistics and
SCM. SD-based models are mainly applicable in situations, where the type of flow
elements can be unified (e.g., on transaction level) and the type and behavior of their
manipulation entities (SC nodes) does not change over time, and as such imposes
no further restrictions to the simulation (e.g., Shah 2005; Tako and Robinson 2012).
In situations when the behavior of the modeled systems depends on the decisions
and interactions of heterogeneous entities, agent-based simulation (ABS) methods
should be used. In both former cases, SC operations are considered on transaction
level. Hence, the temporal aspect is mainly determined by the frequency of transac-
tions, rather than real time. To model time-aware operations, discrete event simulation
(DES) should be used.
In the sequel, the concept of SC integration with the sustainable perspective is
discussed, as well as SC design as a determinant of integration, competitiveness,
and sustainability. Also, the mentioned simulation modeling and analysis (SMA)
methods’ aptitude for solving typical SCM problems is elaborated. Each method’s
properties and limitations are laid out, followed by an illustrative example to state the
case. In our examples, open-source tools are used to emphasize their usefulness for
solving real-world problems. In the conclusion, the observations from the presented
methods and experiments are summarized in considering the different levels and
aspects of SCM with their proposed SMA approach to solving an SCM problem
regarding also SC sustainability. In addition, the real-time perspective is emphasized,
since SCM decisions need to be performed in real time.
2 Sustainable Supply Chain Management and Supply

Chain Design
In the past three decades, there has been a growing interest in both industry and
academia in SCM. Coyle et al. (2003) represent SCM as a logical evolutionary exten-
sion of the logistics concept. They regard its evolution as a sequential extension of
the scope of logistics: from managing the goods flow as a series of independent
activities, through their functional integration (procurement, manufacturing, distri-
bution), to SCM extending the scope of integration outside the company to embrace
suppliers and customers. Christopher (2011) highlights that SCM is not just an exten-
sion of logistics management, but it is also about managing relationships across the
complex networks that today’s supply chains have become. Based on an extensive
literature review of various definitions, Mentzer et al. (2001) have defined SCM as a
“systemic, strategic coordination of the traditional business functions and the tactics
across these business functions within a particular company and across businesses
within the SC, for the purposes of improving the long-term performance of the indi-
vidual companies and the SC as a whole.” Integrating sustainability with SCM has
led to the important concept of sustainable SCM. Taking the sustainable perspective,
the functional coordination should also seek to achieve social, environmental, and
economic goals. Thus, the sustainable focus requires companies to develop more
comprehensive strategies that go further than the pure goal of SCM to improve the
performance/increase the competitiveness of the SC as a whole, as well as of its
members, or, in more concrete terms, to maximize the profit/enhance customer sat-
isfaction/achieve high customer service levels at lower costs, etc. When long-term
sustainability strategies are integrated throughout, the SC companies can achieve
higher economic performance and thus create a competitive advantage (Carter and
Rogers 2008).
Judging from the different authors’ views, it appears that integration, which passes
through several phases of development, is the foundation of the SCM concept.
Christopher (2011) underlines that internal integration (within a single organiza-
tion) by itself is not sufficient for SCM. Thus, he posits four distinct stages of SC
integration. The first three stages refer to the sequential internal integration and the
final one involves interorganizational integration.
Similarly, Harland et al. (1999) point out four levels of integration: internal level
(process integration within the firm); dyadic level (buyer–supplier integration); chain
level (integration of a set of dyadic relationships); network level (inter-business net-
work integration). The abovementioned views indicate that two generic levels of
integration can be distinguished—internal and external. The coordination of the
internal functions needed to achieve the company’s goals is often defined as inter-
nal SCM (Chopra and Meindl 2007). Sustainable SCM is also often considered as
having intra-organizational elements related to company “in-house” processes, and
interorganizational elements referring to sustainable initiatives that imply collabora-
tion among SC members (Shi et al. 2012).
Several studies in the field of SCM have shown that there is a relationship between
internal and external integration. It has been pointed out that both of them are needed
in order to achieve SCM goals and that external integration will not occur until
SC members have achieved high levels of internal integration (Stank et al. 2001;
Bowersox et al. 2013).
The complex interrelationships in interorganizational systems and within individ-
ual firms in the SC are addressed with different approaches. A common way is to
regard supply chains concerning their design and their planning and management.
SC design defines the topological features of the network and the level of collabora-
tion between partners, while SC planning and management related to the operation
of the network (Pero et al. 2010).
SC design critically impacts the competitive position and sustainability of supply
chains. According to Harrison (2005) as much as 80% of total product cost may
be influenced by decisions related to design issues. When designing sustainable
supply chains, increased logistics costs in one SC member may reduce the total SC
costs. Thus, the benefits of sustainability may not be perceived due to the lack of
immediate returns for the needed efforts (Strandhagen et al. 2017). SC design also
greatly determines lead times within the network and SC lead time as a whole as
well. SC lead time includes the time for product design, sourcing, production, order
processing, and distribution. The lead times for these processes can be further divided
into smaller elements for the purposes of management. For example, the elements
of the production lead time are queue time before processing, setup time, run time,
waiting time after processing, move time (Singh et al. 2013). Many authors agree that
it is the run time only that adds values to the products and the other and types of lead
times should be continuously shortened if not totally eliminated. Complete cycle time
is a function of individual lead times (Samaranayake and Laosirihongthong 2016).
Singh et al. (2013) ascertain that by reducing lead times, companies can increase their
efficiency, effectiveness, and responsiveness to market thus using it as a competitive
weapon.
3 Supply Chain Modeling and Simulation
SC modeling is important to SCM in that it can give a critical input to the SC design.
Simulation modeling can be used to graphically visualize time-based “flows” through
complex SC “processes” and “resources;” allowing the prediction and quantification
of possible outcomes from different scenarios (Rashid and Weston 2012). This helps
entities to gain valuable insights and understand the effects of their potential decisions
on the SC performance including SC lead time and costs (Ip et al. 2011). Hence, SC
modeling can contribute to the SC analysis and to the improvement of the SC design
toward achieving higher sustainability.
Various methodologies for SC modeling have been developed. System dynamics

(SD) is a methodology for analyzing complex, dynamic and nonlinear interactions
in systems and as a result new structures and policies can be designed to improve the
system behavior (Kumar 2014). Physical and information flows are addressed with
the aim to reduce their delay and ultimately SC inventory.
Discrete event simulation (DES) is one of the most widely used and flexible
analytical tools in manufacturing systems. It successfully handles uncertainty and
provides possibilities to view in different ways alternatives for lead time reduction
and higher machine and resource utilization, to quantify results and compare them
to the present performance (Xia and Sun 2013).
Pereira (2009) asserts that the complementary use of SD and DES approach can
address data demand issues, since SD helps to understand the interaction between
major dynamic partners in the SC and DES can be used where more detailed data are
needed as the lead time to make a product. SD successfully deals with complex and
strategic problems, allowing the analyst to study different types of flows (material,
personnel, money, and information), but it does not address some SC characteristics
due to the increased level of uncertainties and risk that are typical for SC activities.
That is why SD can be combined with DES which can represent individual events
and address the uncertainties (Pereira 2009; Kleijnen 2005).
Agent-based simulation (ABS) is helpful in understanding the behavior of organi-
zations in a market and the behavior of agents within an organization (Gómez-Cruz
et al. 2017; Grzybowska and Hoffa-Dabrowska 2018). It supports the analysis of
interdependences between consumers, retailers, and producers to aid in decision-
making (North et al. 2010; Behdani et al. 2013). Gómez-Cruz et al. (2017) discuss
the applications of ABS in logistics, which are some of the earliest used. They assert
that ABS could capture the complexities of current logistic markets thus having a
great impact in this area.
The above discussion leads to the conclusion that a holistic approach of applying
simulation modeling would contribute greatly to complex SC designs where there
are many variables interacting with each other. A useful integrated approach could
include SD, DES and ABS methodologies which can quantify behaviors of workflows
through different supply chain levels.
In general, with the SC simulation model we strive to fulfill the Conant–Ashby
theorem (Conant and Ashby 1970) on a good regulator, being a model of the system,
representing a mapping of the SC to the model or in other words, having as many
parts and states as its original.
One can observe an SC on two levels to observe and model different occurring
phenomena:
1. Macro-level
– self-organization
– co-evolution of entities
– dependency on connections/transport routes,
2. Microlevel
– multiple and heterogeneous entities

– local interactions among entities
– structured entities
– adaptive entities.
However, in-between, there are many facets representing different perspectives of

the SC. A production manager’s view of the SC differs from the marketing manager’s
view which again differs from supply manager’s view. Hence, the models used are
different, even for the same company, let alone its SC.
Although they are performed in real time, the temporal aspect of SC operations
is somewhat ambiguous. Depending on the level and perspective the durations of
operations are measured in days, weeks or even months when considering interorga-
nizational activities, while on the other hand, the intra-organizational operations are
measured in hours or even seconds.
Depending on the nature of the modeled problem, the duration of the shortest
operation or the maximum frequency of incoming/outgoing requests determines not
only the representation of time in an SC model, but also its granularity. The shorter
the minimum duration of the shortest operation or the higher the highest frequency of
requests is, the finer is the granularity of time or in other words the precision of time
keeping in the model. This is important for the modeler, since the model’s reaction
time cannot be shorter than the predefined time granularity. Hence, one needs to
know the durations of processes and inter-arrival times of incoming/outgoing signals
in advance to be able to determine the time units of a system model correctly.
On the other hand, in a simulation model, time can either progress by critical events
from transaction to transaction or continuously. In the first case, the progression of
time in the model is determined by the frequency and durations of transactions. On
the other hand, with continuous-time flow, the operations are invoked according to
the occurrence times of events and process’ durations.
During a simulation, one may speed up the progression of time in the model, so
the processes perform faster than in real time, and this way obtain predictions on
future situations or trends.
3.1 Discrete Event Simulation
Discrete Event Simulation has the following properties:

• Process orientation;
• Focuses on detailed process modeling;
• Heterogeneous entities;
• Micro-entities are passive objects that are promoted through a system model as
defined by the process;
• Events introduce dynamics into the system;
• Formal models are built of events, processes, and service activities;

• Time progresses discretely between critical events or according to a predefined
frequency;
• Model flexibility is achieved by changing the structures of processes that are fixed
during simulation runs.
DES Example
The following DES usage example comprises a model of variant production, where
four different products are being produced (Fig. 1, extracted from the JaamSim (King
and Harrison 2013) simulation environment). According to the production plan, some
10, 30, 40, 20% of product types 1, 2, 3, and 4, respectively, are being produced.
Choosing a product type is induced by the triangular distribution between 1 and 4
with modulo at 3. Each product type has a dedicated production line. The production
orders are fulfilled according to the exponential distribution around the 30 s mean
time value. The production of every single product takes 100–120 s according to the
uniform distribution. After they are finalized, the products are checked for quality at a
dedicated test site. The quality check takes 10 s. From the company’s experience, on
average every 1 out of 10 products doesn’t pass inspection. Products of insufficient
quality are transported back to the original production line. Their reprocessing takes
120–130 s according to the uniform distribution. The durations of production and
quality inspection and reprocessing don’t depend on product type. After they have
successfully passed their quality control the finished products are transported from
Fig. 1 DES Example: variant production with quality control

the production site to the finished products warehouse. In this way remanufacturing
of defective products while still in production facilities appears as an effective way
to reduce both environmental impacts and manufacturing costs.
DES Example Analysis

Through the discrete events simulation, the following process parameters can be
analyzed and optimized:
• Production cycle length and production quantity;
• Utilization of production cells and spaces;
• Size and placement of storage spaces as well as products’ dwell time;
• The utilization of mobile resources (e.g., operators, conveyors, forklifts).
The optimization of all these parameters, especially the utilization of resources,
contributes to the sustainability of production. In general, one may say that DES
analysis offers the most detailed insight into a logistic (production) process by a
consistent and coherent model. The time granularity is closest to the real world.
Hence, DES is highly graded as a tool to determine real-time behavior and resource
capacities of process industry, including logistics (resource utilization). Moreover,
DES could support the establishment of stable production cycles that enable the
manufacturer to provide accurate lead time quotes to customers, and more accurate
orders to suppliers for materials (Yoho and Rappold 2011). This stability improves
the coordination of processes between SC entities and may lower total SC costs.
3.2 System Dynamics
System dynamics has the following properties:

• System centeredness;
• Key performance indicators’ oriented modeling of system variables;
• Homogeneous entities;
• Entities on micro-level are disregarded;
• Dynamics is introduced by feedback loop coupling;
• Formal models are built of buffers and flows;
• Time progresses continuously as part of the system variables, being changed
through transactions;
• Model flexibility is achieved by changing the structure of the system model that
is fixed during simulation runs.
SD Example
Our example (Gumzej and Rosi 2017a) comprises a home appliance company’s SC
and describes material flows between its subsidiaries (Fig. 2, extracted from the
NetLogo simulation environment). The company has multiple production sites—
main site in Slovenia (SI) as well as affiliate firms in Germany (DE), Poland (PL),
Fig. 2 SD Example: layout
Hungary (H), and Bosnia–Herzegovina (BIH). In addition to production sites, its

gross-sales sites are situated in Russia (RUS), Ukraine (UKR), and Romania (RU).
The production sites supply their own markets with finished products and each other
with product components.
The dashboard serves as an DST (Fig. 3, extracted from the NetLogo simula-
tion environment), to covenant the production- and stock quantities with the pre-
dispositions and their physical distribution. The time flow is continuous throughout
every day’s transactions, i.e., every day a certain number of components are shipped
between production sites and a certain amount of finished products are consumed on
site or shipped to the distribution sites.
Based on an initial stock of 300 units at SI location and 0 stock at other locations
and our distribution model the stock quantities at individual locations (Fig. 3) rep-
resent the average stock according to given production (pcs), consumption (%) and
shipping (%) rates.
SD Example Analysis
Systems dynamics simulation allows for:
• Planning the layout of an SC;

• Optimization of production and distribution quantities;
• Estimation of distribution channels’ loads and associated costs.
In general, one may say that SD analysis offers an SC manager’s view of a produc-
tion process by a consistent and coherent model. The time granularity is consistent
Fig. 3 SD Example: dashboard
with the frequency of SC transactions. Time progresses synchronously for all com-
ponents of the model. Hence, SD is regarded as a tool best suited to determine
the optimal volumes (when and how much) of individual site’s inputs, stocks, and
outputs. Therefore it allows for the efficient utilization of production and storage
facilities.
3.3 Agent-Based Simulation
Agent-based simulation is characterized by

• Entity-centeredness;
• Problem-oriented modeling of entities and their interactions;
• Heterogeneity of entities;
• Micro-entities are active objects that act in their environments, communicate
among each other and autonomously make decisions;
• Decisions and interactions between agents introduce dynamics into systems;
• Agents and their environments constitute formal models;
• Time flow is discrete and universal on model-level;
• Model flexibility is achieved by changing the system structure and behavior of
agents;
• System structure during simulation is variable.
ABS Example
The presented example (Gumzej and Rosi 2017a) was used to analyze the behavior
of the market (Fig. 4, extracted from the NetLogo simulation environment) by ABS
in a manner similar to (Gumzej and Rosi 2017b). In our example, the introduction of
a new product with its effect on a company’s SC was investigated. In an environment
of an increased rate of product introductions, the SC should be constantly realigned
Fig. 4 ABS Example: dashboard with SC layout
to effectively and efficiently deliver the new products to markets. This could prevent
failed product launches due to out of stock situations because of insufficient capacities
(Pero et al. 2010) as well as avoid overproduction and overstocking which contribute
to unnecessary waste.
The model was parameterized to reflect a typical distribution of producers and
wholesalers. The answer one was seeking was, how many producers and wholesalers
should be involved in the production and dissemination of a product, how many
products should they produce per day, and how would this affect the markets—a
typical strategic decision.
The model was parameterized based on our previous knowledge about SC entities
and their markets in terms of the size (population) of their markets, the average GDP,
birth and death rates as well as the foreseen acquisition and return rates of the product.
The network was laid out in a way to allow for each seller to be associated with at
least one producer from its vicinity. The production sites were parameterized with an
initial production size of 100 units, a bay of 1000 potential buyers and their average
GDP distributed normally on (500, 600) EUR interval. The sales locations were
parameterized with an initial sales quantity of 100 units, a bay of 10,000 potential
buyers and their average GDP distributed normally on (400, 500) EUR interval. The
birth and death rates were set to 3% and 4–5%, respectively whereas the acquisition
and return rates were set to 2–3% and 1–2%, respectively. The simulation time was
limited to 1000 days.
Based on the results, the sizing and pricing of the new product and its distribution
channels were determined.
ABS Example Analysis

Agent-based simulation allows for:
• Planning the layout of an SC;
• Modeling the dynamic growth of an SC;
• Modeling the behavior of partners within SCs;
• Optimization of global indicators.
In general, one may say that ABS analysis offers a strategic manager’s or market
regulator’s view of one’s marketplace by a consistent and coherent model. The time
granularity is consistent with the frequency of SC transactions and the life cycles of
SC nodes. Hence, ABS is regarded as a tool best suited to determine the optimal struc-
ture and layout (where/how many) and assortment (what) of one’s market and/or SC
by considering their global characteristics (e.g., demography, climate, GDP, quality
awareness).
4 Discussion
From the previously stated facts, we can conclude that the selection of a simulation
paradigm greatly affects the resulting formal model. Hence, we set the rule of thumb,
that one should choose the paradigm that is closer to the nature of the problem being
modeled and enables better flexibility, sensibility and maintainability of the models
(c.p. Table 1).
Our models show that the results obtained on different levels can be transferred
among them without compromising the consistency of the individual models, keeping
in mind the temporal aspect. In a usual top-down approach, where first the strategic
decisions are made and their effect is then further investigated on tactical and oper-
ational levels, the application of methods shall be quite the opposite from the order
of presentation in chapter, however, this depends on the problem being solved. If our
Table 1 Suitability of
Network Strategy Procedure and
modeling and simulation
planning formulation time planning
methods for SC DSS
DES Tactical, Tactical, Tactical,
operational operational operational
SD Strategic, Strategic, Strategic,
tactical tactical tactical
ABS Strategic, Strategic, Strategic,
tactical tactical, tactical
Operational
problem pertains to only one level/aspect of the domain then it can and should be
solved on that level. Otherwise the implications of the solution to other levels should
be further investigated prior to taking envisaged actions.
5 Conclusion
When solving the described SC problems, the managers need to make decisions
on multiple and diverse hierarchical levels. These can be categorized as strategic,
tactical and operational, depending on their effect on the SC as a whole. Due to
the interdependences between the three layers, the SC management is often unable
to solve their problems on any single level. At the same time, it is also difficult to
observe all three levels at any individual SC entity. To find adequate solutions entity-
and level-breaching methodologies are necessary like the one presented here.
Simulation Modeling and Analysis methods have proven useful when estimat-
ing the effect of introducing changes or new components in a system by enabling
system-level insight and performance analysis. By utilizing the methods within the
Deming’s “plan-do-check-act” cycle of improvements it is easier to foresee the
impact of changes and implement only the desired ones. In the course of eco-
production, the desired changes are represented by orchestrated changes at SC eche-
lons—the enablers—in order to provide for sustainable cyclic production processes.
While it is possible to foresee the effect of changes at individual SC echelons by
simulating and experimenting on their models at individual levels, it is often better to
combine simulation paradigms to describe different layers than try to express cross-
level dependencies within a single model. Our proposed approach when modeling
intra- and inter-logistic problems is the following:
1. Strategic level (where, what): ABS;
2. Tactical level (how, capacity): SD;
3. Operational level (whereby, duration): DES.
When doing so, one should keep in mind the time granularities on different levels.
Temporal restrictions can only be expressed by durations of activities on the oper-
ational level. The tactical and strategic levels operate with transactions on daily,
monthly, or yearly basis, depending on the level, on which our problem is being
solved. Time granularities are reduced in the same order, as listed above, from the
magnitude of years on the strategic to months on the tactical and days or even hours on
the operational level. One should also keep in mind that the time intervals and dura-
tions of activities on the operational level need to be reflected by realistic transaction
frequencies on higher levels to prevent bottlenecks.
One can combine simulation paradigms at free will, however, one should avoid
using methods that would limit the flexibility and maintainability of the produced
models on one and the usability of the results on the other hand rather than make them
more meaningful and useful to assist decision-making. Every simulation paradigm
has some concepts and predispositions that limit the system models in aspect and
detail. From the viewpoint of the modeler, it is important to be able to model all
relevant entities and processes with their respective properties on each level. By
doing so, SC simulation modeling and analysis can fulfill its envisaged purpose.
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Identification of Logistics 4.0 Maturity
Levels in Polish Companies—Framework
of the Model and Preliminary Research
Aglaya Batz, Joanna Oleśków-Szłapka, Agnieszka Stachowiak,

Grzegorz Pawłowski and Katarzyna Maruszewska
Abstract The paper describes maturity model that have been developed in order to
assess Logistics 4.0 level. The model is elaborated on the basis of literature review
with respect to Logistics 4.0 and maturity models. Its objective is to propose mea-
sures that exhibit what solutions are recommended for companies as well as how
they can improve their actual state of Logistics 4.0. This paper presents the actual
review of literature referred to Logistics 4.0, Internet of Things as well as matu-
rity models. Based on the aforementioned backgrounds, the novelty of proposed
model is confirmed. The proposed model distinguishes three main dimensions to
be assessed in terms of Logistics 4.0: management, flow of materials, and flow of
information. Each dimension comprises particular identified areas such as degree of
automation, degree of robotization, integration of value chains, data capturing and
usage, the scope of autonomous decisions, and the others. The findings from survey
enable classification of companies and assessment of their Logistics 4.0 maturity in
each dimension. Furthermore, the authors distinguish five maturity levels: Ignoring,
Defining, Adopting, Managing, and Integrated (Oleśków-Szłapka and Stachowiak
in Intelligent systems in production engineering and maintenance. Springer, pp 771–
781, 2016). The L4MM matrix makes possible a complex overview of the whole
processes and finally gives guidelines on how to search for a higher maturity level.
The preliminary research has been done within logistics companies and based on
the conducted survey, it was possible to assess what is actual knowledge and imple-
mentation of Logistics 4.0 tools. The characteristics and areas of the model defined
A. Batz
Chair of Production and Operations Management, Brandenburg University of Technology,
Cottbus-Senftenberg, Germany
J. Oleśków-Szłapka (B) · A. Stachowiak
Chair of Production Management and Logistics,
A. Stachowiak
G. Pawłowski · K. Maruszewska
WSB University, Poznan, Poland

162 A. Batz et al.
enable the assessment of maturity levels within companies providing Logistics ser-
vices (transport and warehouses) in Poland. Identification of logistics maturity of
companies will contribute data for analyzing correlations between the maturity level
of a company, and its competitive position, size, development dynamics, number of
services offered, structure of capital, and level of internationalization of operations
(Oleśków-Szłapka and Stachowiak in Intelligent systems in production engineering
and maintenance. Springer, pp 771–781, 2016). The model proposed by the authors
will enhance static logistics maturity models adding to them a dynamic aspect.
Keywords Logistics 4.0 · Maturity model · Maturity levels · Logistics services
1 Introduction
In line with the World Economic Forum (Lanng 2017) by 2025, the whole global
supply chain will mellow and develop into the network of interconnected companies,
processes, and data flows that will support new business designs and models. The
industrial Internet will help bring disparate processes from procurement through man-
ufacturing to final delivery, under greater control and visibility, which is crucial for
the manufacturing of high-individualized products and services (Oleśków-Szłapka
and Lubiński 2016; Oleśków-Szłapka and Stachowiak 2018). The requirements for
customized items are growing, thus, the logistics (inbound and outbound) has to
adjust to this new dynamic and modifying environment and it cannot be organized
by simple planning and control practices (Bowersox et al. 2000; Premm and Kirn
2015; Grzybowska and Lupicka 2017). The solution to enable the shift is called
Logistics 4.0 and is inspired and based on the concept of Industry 4.0.
In global economy, in dynamic market environment, meeting customer expec-
tations is, on the one hand, a key aspect of the business, and on the other hand,
a constantly increasing challenge. Considering production, the solution that allows
companies to cope with the challenge is Industry 4.0—a concept that changes the
contemporary manufacturing processes and enterprises. Nevertheless, realization of
production processes is impossible without logistics support, which enables effi-
cient and effective implementation of material and information flows. Industry 4.0
elements related to the management of materials and information flow integrating
complex global supply networks form a separate solution, referred to as Logistics
4.0, emphasizing the importance of this area. Logistics 4.0 is a set of solutions aimed
at improving logistics processes by avoiding errors and disruptions in transport and
storage processes, thanks to continuous data exchange between logistic system stake-
holders. Hence, Logistics 4.0 is not only about replacing human work with machines
and robots, but above all, about effective information exchange across the entire
supply network.
Implementation of Logistics 4.0 solutions, so-called “intelligent logistics” seems
to be crucial today for the effective and efficient functioning of companies providing
logistic services. Hence, the choice of Logistics 4.0 as the subject of the research—on
Identification of Logistics 4.0 Maturity Levels … 163
the one hand to recognize the scope of Logistics 4.0 and identify a set of solutions
constituting its essence, diagnose the implementation level of these solutions in com-
panies providing logistics services in Poland, defining the condition of the industry,
and on the other hand to determine the factors affecting the implementation these
solutions and the consequences of this implementation and finally to develop a model
showing causal relations of the implementation of solutions in the field of Logistics
4.0 and subsequent levels of maturity (improvement) in this area. The implemen-
tation of advanced solutions is, however, a gradual process that requires time and
commitment on the road to excellence, hence the research aims to develop a model
covering subsequent levels of logistic maturity of enterprises, showing the determi-
nants, and consequences of implementing solutions in the field of Logistics 4.0 and
thus indicating the path of improvement in this matter.
2 Related Work
In the available literature review, there can be found numerous examples of matu-
rity models for business processes, as well as Industry 4.0 (Borenstein et al. 2011;
Bowersox et al. 2000; Bubner et al. 2014; Caloghirou et al. 2004).
A thorough literature review shows that there is a significant research gap in
the field of Logistics 4.0 (Camisón and Forés 2010). Logistics 4.0 definitions are
imprecise as the concept is not consistent, hence the need to develop coherent the-
oretical approach. Publications on the subject deal with the data flow management
and integration of decentralized complex systems (Grzybowska and Kovacs 2014;
Barreto et al. 2017; Czaja 2016; Glistau and Machado 2018; Hompel and Kerner
2015; Jeschke 2016; Maslarić et al. 2016; Strandhagen et al. 2017; Szymańska et al.
2017; Timm and Lorig 2015; Wang 2016; Witkowski 2016; Wróbel-Lachowska et al.
2018a, b; Zentgraf 2017).
Logistics 4.0 is described in the reports by research centers and logistics service
providers (DHL 2015; Dussmann Group 2016; Fraunhoffer 2016).
Hence, the authors decided to develop their own maturity model to complete the
existing gap. The model relies on assumptions that make possible either assessing
Logistics 4.0 actual state or define a roadmap for further steps in terms of three key
domains: Management, Material Flows, and Information Flows. L4MM is elaborated
based on the analysis of current literature items.
The literature search on Logistics 4.0 publications in Scopus and Web of Science
databases gave the feedback presented in the diagram (Fig. 1).
The search proves that the number of references for “Logistics 4.0” is small but,
on the other hand, it is still increasing. Therefore, this research domain has without
doubt big potential. The total number of references comprises press material and
professional trade publications.
164 A. Batz et al.
100
90
Industry 4.0 + Logistics : Scopus
80
70
60 Industry 4.0 + Logistics:
50 WoS
40
30 Logistics 4.0: total number of references
20
Logistics 4.0: Scopus
10
0
Logistics 4.0: WoS
2013 2014 2015 2016 2017 2018
Fig. 1 The number of publications per year referring to Logistics 4.0 and “Industry 4.0 + Logistics”.
Source Own work based on Scopus and WoS
Apart from publications devoted directly to “Logistics 4.0”, there are also selected
works on the more general subject of “Industry 4.0” where some issues connected
with logistics are discussed. The diagram presents scientific papers indexed by
Scopus and by WoS. The full list of indexed papers with their brief description
is presented in Table 1.
The biggest challenge for companies is to classify, comprehend, and appropriate
use of the available knowledge and thus achieving a competitive advantage (Lev et al.
2008; Liao et al. 2007; Lichtenthaler 2009; Grzybowska et al. 2014). Considering the
abovementioned issues, the authors of the study decided to research on the absorptive
capacity of companies striving for implementation of advanced solutions.
Another important term within conducted research by the authors is maturity.
Maturity can be defined as “the state of being complete, perfect or ready” (Karkkainen
et al. 2014; Mettler 2009). Maturity is referred to growth, as in Maier et al. (2012),
which defines maturity as a state of growth and development.
The subject of maturity is in the field of interest of scientists for a long time. One
of the first scientists dealing with this subject was Crosby who in 1979 developed
a quality management model with five levels of maturity (Kwak and Ibss 2002;
Maslaric et al. 2016; Timm and Lorig 2015).
Maturity models are actually distributed and applied in Project Management
(PM), Knowledge Management, Information Systems, and Supply Chain Manage-
ment (Banyani and Then 2010; Vaidyanathan and Howell 2007).
Plenty of researchers also have defined Industry 4.0 maturity models (Cooke-
Davies 2004; Fraser et al. 2002; Lahrmann et al. 2011; Rosenthal 1978; Schumacher
et al. 2016; Wang et al. 2016), but the authors did not recognize any maturity models
referring specifically to Logistics 4.0.
Thus, the authors proposed their own model of maturity believing that it would
bring added value to existing literature and research in the field of logistics maturity
of companies.
Table 1 Literature on Logistics 4.0 review

Authors Title, Year, Journal The scope of interest
Glistau, E., Machado, N.I.C. Industry 4.0, logistics 4.0 and The paper defines the terms
(2018) materials—Chances and of Industry 4.0 and Logistics
solutions (2018), Materials 4.0. It also outlines the big
Science Forum, 919, opportunities of this
pp. 307–314 development. The paper
provides an overview of
important solutions and tools
in this domain
Wrobel-Lachowska, M., The role of the lifelong This paper describes the role
Wisniewski, Z., learning in logistics 4.0 of the lifelong learning in the
Polak-Sopinska, A. (2018a) (2018), Advances in Logistics 4.0. The paper
Intelligent Systems and shows the key competences
Computing, 596, pp. 402–409 needed by all groups of
employees
Wrobel-Lachowska, M., ICT in logistics as a This paper analyses the scope
Wisniewski, Z., challenge for mature workers. of ICT competencies required
Polak-Sopinska, A., Knowledge management role by employees—logisticians
Lachowski, R. (2018b) in information society (2018), Conclusions of the study are
Advances in Intelligent the result of multi-faceted
Systems and Computing, research conducted in
605, pp. 171–178 2012–2016 using grounded
theory methodology
Strandhagen, J.O., Logistics 4.0 and emerging This paper addresses
Vallandingham, L.R., sustainable business models challenges such as data flow,
Fragapane, G., Strandhagen, (2017), Advances in automated solutions, and
J.W., Stangeland, A.B.H., Manufacturing, 5 (4), real-time big data analysis. It
Sharma, N. (2017) pp. 359–369 proposes a model to
understand and relate the
different elements of business
operations. The paper links
the elements of sustainability,
business models, Industry 4.0
and Logistics 4.0
Barreto, L., Amaral, A., Industry 4.0 implications in This paper presents some
Pereira, T. (2017) logistics: an overview (2017), considerations on how to
Proceedia Manufacturing, 13, enable organizations to be
pp. 1245–1252 efficient, and fully
operational in Logistics 4.0
context
Hompel, M., Kerner, S. Logistics 4.0: The vision of This article attempts to
(2015) the Internet of Autonomous elucidate some key aspects of
things [Logistik 4.0: Die ongoing development and
Vision vom Internet der convey a view of “Logistics
autonomen Dinge] (2015), 4.0”
Informatik-Spektrum, 38(3),
pp. 176–182
(continued)
166 A. Batz et al.
Table 1 (continued)
Authors Title, Year, Journal The scope of interest
Wang K. (2016) Logistics 4.0—New This paper identifies the term
challenges and opportunities “Logistics 4.0”, tries to define
(2016), Conference: 6th it as well as make a list of its
International Workshop of fundamental technical
Advanced Manufacturing and elements. It also deals with
Automation the question—how to address
proactively challenges of
Industry 4.0 revolution
Maslarić M., Nikoličić S., Logistics Response to the This paper provides an
Mirčetić D. (2016) Industry 4.0: the Physical overview of the different
Internet (2016), Open Eng. views in the field of Physical
2016; 6:511–517 Internet trying to identify the
biggest challenges
(technological, societal,
business paradigm) of
proposed new logistics
paradigm as a practical
solution in supporting
Industry 4.0
Timm I., Lorig F. (2015) Logistics 4.0—a challenge The value of this paper can be
for simulation (2015) Yilmaz summarized as follows:
L., Chan W.K.V., Moon I., Integrating autonomous
Roeder T.M.K., Macal C. & decision makers into
Rossetti D. (Eds.), conventional material flow
Proceedings of the 2015 simulation, as required for
Winter Simulation addressing the requirements
Conference, IEEE Press of Logistics 4.0, results in
Piscataway, NJ, USA, increasing complexity
pp. 3118–3119
Source Own work based on Scopus and WoS
3 Proposed Work
The authors start from literature analysis in order to identify the elements of the
Logistics 4.0 concept, its specific solutions, and tools. This stage will allow to develop
a framework model of the logistics maturity of enterprises.
The next stage of the research will include research on enterprises carried out
with the use of questionnaires (CAWI, CATI) addressed to enterprises providing
logistics services in Poland, i.e., assigned to the H section of the Polish Business
Activity Classification. The questionnaire will include questions about the knowledge
of the solutions and scope of their application, as well as about the intentions to
implement solutions and tools from the scope of Logistics 4.0. The results of the
survey will allow to determine the degree of absorption of solutions from the scope of
Logistics 4.0 and to determine the level of logistic maturity in the context of Logistics
4.0 in the population interview. The results of the research will be compared with
the published research results on the implementation of contemporary solutions in
companies providing logistic services around the world.
The third stage of the research will include the analysis of correlations between
the identified absorptive capacity and the level of logistic maturity of companies pro-
viding logistic services, and their competitive position, size, development dynamics,
offer range, internationalization of capital, and the degree of internationalization
of business activity. This stage of the research will include enterprises included in
industry rankings (TSL Ranking).
On the basis of the research conducted, conclusions will be drawn regarding the
condition of the industry and the relationship between the abovementioned character-
istics of individual companies, leading to identification of causal relations showing
the dynamics of the system, which undoubtedly the company providing logistic ser-
vices is, functioning, and the relationship between the enterprise’s characteristics,
implemented elements of the Logistics 4.0 concept and its competitive position. The
feedback model that illustrates the behavior of the company providing logistic ser-
vices will complement the static concept of logistic maturity levels in the field of
Logistics 4.0, leading to the research goal realization.
The theoretical stage of the research based on review and analysis of publica-
tions on Logistics 4.0 will allow to develop an original maturity model, showing the
evolution of logistic solutions and the scope of their application, as well as defining
the reference level of logistic excellence. The Logistics 4.0 Maturity Model will
contribute to the development of the discipline.
The research carried out among companies providing logistics services will help
to gain knowledge about the level and scope of implementation of solutions of the
Logistics 4.0 concept in Polish enterprises. It will also deal with the issue of absorbing
knowledge in the field of Logistics 4.0 and will allow to determine absorptive capac-
ity level, showing the ability to absorb knowledge and the potential of enterprises in
the area of acquiring and implementing contemporary, intelligent and autonomous
solutions and technologies. The diagnosis of the industry will complement the knowl-
edge about the condition of enterprises providing logistics services in Poland with
aspects related to the digitization and application of modern technologies. The results
will help to validate the model and if necessary correct it based on the feedback from
industry. Moreover, the data obtained and the conclusions drawn from them will
be compared with the available materials describing solutions implemented other
countries in this respect. The analysis will contribute to civilization development
as it reflects the shift of paradigms, from traditional taylorism to contemporary,
information-based industries, and societies (Zawadzka et al. 2010).
The analysis of the relations between the Logistics 4.0 maturity level and com-
pany’s market position, its size, development dynamics, range of services offered,
structure of capital, and level of internationalization of operations will lead the authors
of the proposal to develop a cause-and-effect model in the form of a causal loop show-
ing the relationships between the determinants of the decision to implement solutions
in the field of Logistics 4.0 and the consequences of these decisions. Presenting the
168 A. Batz et al.
dynamics of system behavior, the model will be a complement to the static model of
logistic maturity, contributing to development of logistics as a discipline.
The research process planned includes the following actions:
A.1 Developing framework Logistics 4.0 Maturity Model (L4MM) based on litera-
ture review (objectives 1, 2, and 3).
A.2 Research on absorptive capacity of companies providing logistics services in
Poland (objective 4).
A.3 Assessment of Logistics 4.0 maturity of companies providing logistics services
in Poland (objective 5).
A.4 Analysis of correlations between the level of Logistics 4.0 maturity and com-
pany’s competitive position, its size, development dynamics, range of services
offered, internationalization of capital, and level of internationalization of oper-
ations (objective 6).
A.5 Developing dynamic model of behavior of a company providing logistic ser-
vices based on relations between the identified level of maturity and company’s
competitive position, its size, development dynamics, range of services offered,
internationalization of capital, and level of internationalization of operations
(objectives 7 and 8).
And dissemination of project results in scientific papers (A.6) and a monograph
entitled: Logistics 4.0: challenge and opportunity (A.7). The actions listed above
will be continuously adding value to the project and the discipline, as presented in
Fig. 2.
In order to define Logistics 4.0 Maturity Model based on the level of absorption
of Logistics 4.0 solutions in companies providing logistics services, the authors have
carried aforementioned literature survey in the scope of Logistics 4.0 domain. The
next step was a pilot study on Logistics 4.0 among companies providing logistics
services. Based on these research stages, it was possible to develop Logistics 4.0
Maturity Model. The Logistics 4.0 Model was used to select classification criteria.
Fig. 2 The increase in value of the project. Source Own work

Table 2 Logistics 4.0 dimensions and areas of evaluation

Logistics 4.0 dimensions Areas of evaluation
Management Ongoing and planned investments, innovations management,
integration of value chains
Material flow Automation and robotization implemented in warehouse and
inbound logistics, implementation of solutions such as Internet of
Things, 3D printing, 3D scanning, advanced materials, augmented
reality
Information flow Implementation of solutions such as data-driven services, Big data
(data capturing and usage), RFID, RTLS (real-time locating
systems), IT systems (ERP, WMS, cloud systems)
Source Own work
The classification is based on the three aspects of logistics1 including: (1) manage-
ment (2) material flow, (3) information flow, which becomes naturally three dimen-
sions for Logistics 4.0 solutions, as presented in Table 2.
The three dimensions of the model can be used to assess the maturity and aware-
ness of managers concerning solutions within Logistics 4.0 implemented in a com-
pany. Based on the number and scope of solutions implemented, the conclusion
on present Logistics 4.0 status can be drawn. Moreover, based on the gaps identi-
fied, recommendation concerning the Logistics 4.0 status improvement, and maturity
increase, can be defined, making the model useful not only in terms of diagnosis, but
also in terms of management.
According to the authors, the term “Logistics 4.0 maturity” reflects the level of
Logistics 4.0 solutions implementation, the less solutions implemented, the lower
Logistics 4.0 maturity level. The authors defined five maturity levels: Ignoring,
Defining, Adopting, Managing, and Integrated. In Fig. 3 maturity levels are con-
fronted with Logistics 4.0 dimensions.
The assessment of maturity level is based on analysis of solutions implemented
within Logistics 4.0 dimensions. The authors decided that the most important deter-
minant of maturity and dimension of logistics is management, and if integration
level is coherent with at least one form of the flow (either material or information)
the maturity level the two represent is the one that characterizes the company best,
assuming in the same time that the latter dimension is soon to be upgraded. The gap
identified and the steps to be taken to fill it in should be presented to the company,
representing the general guidelines for reaching the next level of maturity.
1 According to Council of Supply Chain Management Professionals (previously the Council of

Logistics Management) logistics is the process of planning, implementing and controlling (alto-
gether referred to as management) procedures for the efficient and effective transportation and
storage of goods (material flows) including services and related information (information flows)
from the point of origin to the point of consumption for the purpose of conforming to customer
requirements and includes inbound, outbound, internal and external movements.
170 A. Batz et al.
Fig. 3 Logistics 4.0 maturity levels. Source Authors’ own work
4 Results
The first action taken was the search for the literature on Logistics 4.0 and its results
are presented in the application form in the Sect. 2. The search showed a cognitive
gap, as the term and the issue of Logistics 4.0 was referred to eight times only.
According to the authors’ opinion, it is the rationale for realization of there searches
recognizing new term in logistics management is interesting and promising field of
research.
The second step was the survey among Polish companies providing logistic ser-
vices. The survey aimed to find out whether the companies know the term Logistics
4.0 and/or use solutions usually referred to as Logistics 4.0 solutions (identified based
on the preliminary literature review).
The survey was a direct interview (CAWI––Computer-Assisted Web Interview)
distributed among 17 companies. The sample included 17 enterprises (11 enterprises
employing more than 250 people, 2 companies employing between 100 and 249
people, 2 2018 companies employing 50–99 people, and 2 companies employing
10–49 people) operating both, in Poland and internationally.
The survey research was being conducted for six weeks, from April, 1 to May 15,
2018. To identify the level of knowledge on Logistics 4.0 and the solutions within
it, the respondents were asked whether:
1. they know the terms Logistics 4.0 and Industry 4.0?
2. their warehouse is automated?
3. their handling processes are automated?
4. their data flow and access to information is integrated in real time?
5. they analyze, store and process data with contemporary technologies (i.e., Big
Data, Cloud Computing)?
6. they use RTLS in their logistics processes?
7. they know the term Internet of Things and/or Services?
The answers to the questions are presented in Table 3.
Table 3 Results of preliminary survey on Logistics 4.0 solutions

Question 1
53% responses: 0% responses: 29% responses: 17.5% responses:
never heard of know the concept know the concept know the terms
Logistics 4.0 nor of Industry 4.0 of Logistics 4.0 Logistics 4.0 and
Industry 4.0 only only Industry 4.0
Question 2
70.6% responses: 17.6% responses: 11.8% responses:
warehouse partially warehouse not automated warehouse fully
automated automated
Question 3
82.4% responses: 11.8% responses: 5.9% responses:
handling operations handling operations not handling operations fully
partially automated automated automated
Question 4
88.2% responses: benefit 5.9% responses: do not 5.9% responses: have no
from integrated data flow use integrated data flow information on
and access to data in real and access to data in real integrated data flow and
time time access to data in real
time
Question 5
52.9% responses: 23.6% responses: do not 23.6% responses: have
analyze. store and process analyze. store or process no information on
data with contemporary data with contemporary analyzing. storing or
technologies technologies processing data with
contemporary
technologies
Question 6
17.6% of 29.4% of 47.1% of 5.9% of
responses: use responses: plans to responses: do not responses: have
RTLS in their use RTLS in their use RTLS in their no information
logistics processes logistics processes logistics processes of using RTLS
in their logistics
processes
Question 7
41.2% of responses: 47.1% of responses: do 11.8% of responses:
know the term IoT/IoS not know the term have no information
IoT/IoS whether they know the
term IoT/IoS
172 A. Batz et al.
The highlighted boxes represent positive answers, meaning that the respondents
know and implement the tools and methods within Logistics 4.0, disregarding
whether they know the term itself. Nevertheless, the awareness of the Industry 4.0
(including some of the tools and methods within Logistics 4.0 range) and Logistics
4.0 is quite high (47% of respondents), proving that companies providing logistics
services see the potential of contemporary solutions and are willing to benefit from
them. The trend is even more visible among USA companies, where the potential of
contemporary solutions such as IoT is recognized by 84% of companies (HP Report
2018). Referring the conclusion to the limited number of valuable literature sources
proves that there is a significant gap and the need for dissemination of knowledge
and research on the field, and that achieving the objectives of the research could
contribute to both, science and economy development.
5 Conclusion
The goal and the requirement of contemporary economy are both agility and ability
to learn––thanks to the connected digitization and solutions broadly referred to as
Industry 4.0 and Logistics 4.0. The research carried out by the Ministry of Devel-
opment and Siemens in the years 2016–2017 collected as part of the Smart Industry
Polska Report (2018) prove that many enterprises have little knowledge about the
characteristics of these concepts, the solutions they propose, as well as the benefits
of using the latest methods of process digitization. The pilot research conducted by
the author among polish logistics companies confirms the conclusion presented in
the Smart Industry Polska Report.
The diagnosis is important and valuable when it becomes the basis for improving
actions—thanks to knowing where companies are today, they can define their future
goals and steps required to reach it. Thus, assessing Logistics 4.0 maturity will help
visualize companies’ path forward and set priorities for process improvement. Based
on preliminary results from survey conducted by the authors in logistics and manu-
facturing companies from among the surveyed companies, only 33% know the term
Logistics 4.0, 50% of companies know the concept of big data, and 83% companies
want to apply automated data exchange systems and are willing to automate their
processes as well as introduce partial robotization of the processes. The diagnosis
shows that there is a need for education and space for improvement.
Consequently, the diagnosis of logistics maturity of companies will enable assess-
ment of the logistics sector condition in Poland and will provide data for analyzing
correlation between the maturity level of a company, and its competitive position,
size, development dynamics, range of services offered, structure of capital, and level
of internationalization of operations. The analysis is expected to be on the basis of
general conclusion and development of original system dynamics model presenting
behavior of a company providing logistics services in the form of causal loop. The
model will add dynamic layer to the static concept of logistics maturity levels and
contribute to the development of management science.
6 Future Work
The objective of the research will be the diagnosis of absorptive capacity of Polish
companies providing logistic services. Based on the developed survey questionnaire,
it will be possible to identify absorptive capacity of companies providing logistics
services in Poland and define their Logistics 4.0 Maturity level. Furthermore, map-
ping the survey results on the developed Logistics 4.0 Maturity Model makes possible
to assess logistics maturity of companies (individual, average, minimum, maximum,
and dominant). Then, Logistics 4.0 maturity of Polish companies providing logistics
services will be compared with the correspondent data on companies representing
the same industry but operating on different markets. At this stage, the authors plan to
apply statistical analysis: multidimensional comparative analysis using basics statis-
tics and Multiple Correspondence Analysis (MCA) to detect and represent similarity
and diversity across countries.
The next stage will be statistical analysis: (1) chi-square independence test to
verify the relation between the level of maturity and factors indicated (competitive
position, size, development dynamics, range of services offered, internationalization
of capital, and level of internationalization of operations) and assumption of selected
measures of association adjusted to nominal and ordinal data (Pearson’s contingency
coefficient C, Cramér’s V, Gamma, Somers’ d, Kendall’s tau-b, and nonparametric
Spearman’s rank-order correlation coefficient) with testing correlation significance
using the data from published reports ranking the companies providing logistics
services; (2) Multi-criteria Decision Analysis (MCDA) to analyze the importance and
the relations among the main determinants of Logistic 4.0 solutions and rank data;
using the technique based on the Decision-Making Trial and Evaluation Laboratory
(DEMATEL) method to build the structural model with position and relations among
the determinants showed at the Impact-Digraph-Map. Finally, the authors want to
develop the causal loop with feedbacks between the determinants and consequences
of Logistics 4.0 solutions implementation and combine Logistics 4.0 Maturity Model
with dynamic model of behavior of a company providing logistic services based on
feedbacks between the level of maturity and company’s competitive position, size,
development dynamics, range of services offered, internationalization of capital, and
level of internationalization of operations.
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Dynamic Organisation of Traffic Flows
in the Transport Network in Terms
of Sustainable Mobility
and the Development of Industry 4.0
Grzegorz Sierpiński and Ireneusz Celiński
Abstract The chapter presents a concept for the method of traffic flow organisation
in the transport network by dynamic changes to various components of the infrastruc-
ture. Proposed improvements include continuous (dynamic) changes of traffic flow
organisation based on collected and processed data that describe the road network as
regards its instantaneous use. The data in this approach are acquired with respect to
specific profiles of the road network. Road network components in question enable
to change dynamically and improve the traffic flow organisation based on data col-
lected and processed in Big Data sets. Those sets are associated with the entire urban
socio-economic system rather than a specific transport network. For their legitimate
use, data acquired from multiple sources, examples of which are presented in the
chapter, undergo complex processing and modification according to the Industry
4.0 concept (in this sense, transport network user is integrated into network-based
IT systems). At the same time, the idea of dynamic traffic improvement, regarding
nearly all components of the transport infrastructure, should lead to reduced cost
and better traffic flow distribution in the transport network from the point of view of
the entire system. The above means that the traffic distribution should be typically
implemented in transport systems with controlled traffic. The introduction of a large
number of reasonable changes to a number of road network cross sections reduces
the stochastic nature of the road traffic. At the same time, the aim is to promote
sustainable mobility not only in designated sections of the transport network, but
also in the entire area.
Keywords Sustainable mobility · Traffic flow organisation · Transportation

network design and planning · Big data sets · Road network
G. Sierpiński (B) · I. Celiński

Faculty of Transport and Aviation Engineering, Silesian University of Technology, Katowice,
Poland
I. Celiński

178 G. Sierpiński and I. Celiński
1 Introduction
The observed continuous increase in the number of vehicles on the road network,
combined with a reduced financial and technical capacity to develop transport infras-
tructure, leads to urban congestion, which apart from lost time translates into an
adverse impact on the environment (Clean Power for Transport 2013; Stanley 2014).
This phenomenon is particularly vivid during rush hours, which become increas-
ingly long each day. Only a major change in traffic flow organisation in the road
network can rectify the situation. Such comprehensive, holistic changes, which take
into account the various data, modes of travelling in the network, and recognises
events outside the transport network (entire socio-economic environment), should
be applied at the same time to a large number of road network sections.
Use of Intelligent Transport Systems (ITS) enables to increase the use of existing
transport infrastructure within a certain area (restricted control zone) (White Paper:
Roadmap to a Single European Transport Area 2011). It is possible, among others,
by improving the distribution of traffic in time and space in the network by dynamic
traffic distribution. This same applies to locations away from congested streets in
the road network, the capacity of which has not been utilised. The organisational
method enables to reduce the number of bottlenecks in the transport network. The
problem is, however, that these systems use information originating mainly from
urban areas connected through developed transport infrastructure, its direct environ-
ment, whereas the control system disregards information from a wider surrounding
of the transport network.
In this context, changes in the modal split by increasing the role of public transport
are also important. Activities supporting the development are based on the dedicated
and long-term development of modal split, as manifested by a balanced transport (Our
Common Future Report 1987; Banister 2008; Verma and Ramanayya 2014). This
entails the influence on people travelling to change their transportation behaviour.
In many instances, integrated traffic control in the road network is not sufficient
in this respect. Thus, it is necessary to promote synergy through a wide range of
different actions. It requires not only a bidirectional flow of information between
individuals travelling and broad understanding of the ‘city’ with particular emphasis
on its transport infrastructure, but also sources of information outside the transport
network, especially that undoubtedly, a number of such sources are available. In this
context, it is important to develop information technology that allows us to determine
transport needs and, at the same time, predict and better plan future solutions for the
organisation of the traffic flows in the transport network.
The implementation of the idea of Industry 4.0 involves the use of automation, pro-
cessing and exchange of data in combination with the relevant production techniques
(Zezulka et al. 2016; Gunasekaran et al. 2019). The implementation of Industry 4.0
for the development of transport networks to enhance integration between people and
the transport system provides a wide range of possibilities to develop smart mobility.
It should be noted in this context that, in traffic control systems, a group of vehicles
Dynamic Organisation of Traffic Flows in the Transport Network … 179
rather than an individual traveller is integrated with the system. Information, origi-
nating from a variety of sources, can be processed between the transport system and
its users on an ongoing basis. Then, it is possible to use information dedicated to
specific groups of users by disseminating dynamic information in the urban space
(Sierpiński and Staniek 2016).
The chapter presents the possibility of combining Industry 4.0 with smart
mobility to promote sustainable transport development. The proposed method points
to existing data sources, including trip planners. The chapter presents other available
sources of data that may be relevant. It also discusses the expected effects of broad
integration between Industry 4.0 information technology and the urban transport
system.
Moreover, the publication discusses various ways of information processing and
data exchange that facilitate traffic flow organisation adjustment to the needs of cit-
izens following the principles of sustainable development. Considering the above,
transport infrastructure can be considered as a collection of objects which enable
continuous traffic flow organisation improvements. As regards the subjects of trans-
port, traffic flow organisation focuses on trips themselves rather than vehicles, which
is particularly important for the optimization of the public transport. This, however,
necessitates to collect data (in large quantities, Big Data sets), and modify and adjust
them for the purpose of designing and producing modern traffic flow organisation
elements in the form of the vertical signs with a variable content.
2 Dynamic Organisation of Traffic in the Transport

Network
In the transport network, the organisation of traffic flow involves the distribution of
road traffic (including node and line infrastructure). The distribution needs to take
into account of technical and technological limitations on particular connections
in the transport network, such as capacity of road sections, load bearing, limited
road gauge. Traffic flow organisation is constant in the long-term perspective. In
such an approach, traffic flow organisation is considered in statistical terms (in fixed
intervals) for known demand Z P for transport on specific routes between points a
and b (Jacyna 2008):

Z P = x ab : (a, b) ∈ R (1)
where
a, b pair of vertices, source and exit in transport network
x ab demand for transport between a pair of vertices in the network: a and b
A, B sets: traffic flow sources and exits
R origin–destination relationships in the transport network R ⊂ A × B =
{(a, b) : a ∈ A, b ∈ B}.
Additionally, static traffic flow organisation is determined with the known set of
all routes P used in the transport network in the form of (3)

P= P ab (2)
(a,b)∈R
where
P ab set of roads on routes: (a, b).
Thus, we define traffic flow organisation in the transport network as follows (3):
o : P ab × Z P → R + (3)
where
o traffic flow organisation:

O = {o : o p, x ab ∈ R + , p ∈ P ab , x ab ∈ Z P, (a, b) ∈ R}.
At this point, we should distinguish between the traffic flow organisation described
by functions (1)–(3) and the organisation based on using road signs. The distribu-
tion of traffic on roads is associated with a specific demand for transport and it is
determined considering specific traffic flow organisation in the transport network as
a set of horizontal and vertical road signs. The authors have drawn attention to the
fact that such an organisation can be dynamically adjusted by relevant changes of
the content displayed in vertical road signs. The same is true for horizontal signs,
although it is a separate topic not discussed in the chapter.
It should be noted that today, apart from a few cases, the demand for transport is not
constant both in relation to the transport of goods and the public transport of people
(as well as individual transport). It is not constant both over time and in transport
network space, since there are daily, weekly, periodic and seasonal fluctuations.
Changes that have taken place in the life of contemporary societies in recent decades
cause that demand for transport changes each year. Not only does the volume of
demand on individual routes change, but also routes themselves. This is due to the
partial relocation of traffic generators and absorbents within the settlement network.
The organisation of traffic flow, taking into account changes observed in time and
space in the transport network, should be treated as follows:

O1 , O2 , .., Oi , . . . , On = oi : oi p, x ab (4)
where
Oi organisation variant i.
In this sense, we define n variations of traffic flow organisation in the transport
network depending on the status of the network, and the proposed dynamic changes
of the organisation using vertical signs should facilitate these changes. For various
periods of a day, due to uneven daily traffic, we may adopt one and the same variation.
Hence, it is a collection of certain variations. However, due to such fluctuation in the

transport network, we should define a number of traffic flow organisation variations.
The key to implement this type of projection is the dynamic shaping of routes
in the transport network and examining the flow of goods and/or people on those
routes. This approach to traffic flow organisation should be supported by an appro-
priate modal split in order to balance the development of transport. In this sense, the
organisation of traffic flow in the transport network following principles of sustain-
able transport development is consistent with the projection:
OiM ∝ (S M1 : S M2 : . . . : S Mi : . . . S Mn ) (5)
where
OiM variation taking into account the modal split in the network
S Mi share of a specific mode of transport i in total traffic flow in the network.
The function is generated from the point of view of the modal split in the entire
transport network. Therefore, instantaneous organisation of traffic flow (4) is adjusted
to the modal split. Apart from this form of traffic flow organisation, interpreted as
the distribution of traffic flows (existing) on roads in transport network, there are
also restrictions on traffic flow organisation on specific road sections implemented
through traffic control systems, and vertical and horizontal road signs. Although in
the case of traffic control, we can refer to certain dynamics of changes as regards
the parameters and algorithms of traffic control system (Małecki et al. 2017), in the
case of horizontal and vertical signs these elements remain static in a longer period.
Is it possible to improve the traffic flow organisation on these sections in relation to
dynamic changes in demand for transport, including the shaping of the modal split?
In the case of traffic control systems, it is possible to adapt traffic light programs
to the changing traffic (Celiński and Sierpiński 2013b). Thus, traffic parameters can
change. The same is also possible in the case of vertical and horizontal road signs.
The use of variable content signs and their possible influence on travelling persons
was discussed by several publications, including (Erke et al. 2007; Arbaiza and
Lucas-Alba 2012; Er-hui et al. 2013; Celiński et al. 2015; Li et al. 2016; NCHRP
SYNTHESIS 383 Report 2008). While this type of display technology to provide
information about traffic using vertical signs, it is possible to improve traffic flow
organisation on specific sections of the road network. The criterion for these changes
should depend on the actual demand for transport on specific routes, including from
the point of view of a relevant modal split (Celiński and Sierpiński 2013a).
At present, traffic flow organisation based on vertical and horizontal signs is
archaic in the majority of transport networks. It is often justified on the grounds of
safety, whereas financial considerations in this respect are believed to be objective.
Fixed vertical signs prevail in road networks when the production cost of an LCD
display of comparable surface area is close to the cost of a fixed sign. The develop-
ment of solar photovoltaic systems enables to supply power to this type of road and
street signs with no major difficulties. It is more relevant the closer the road network
is to the equator. The development of electromobility supports the above solution
since more powerful rechargeable batteries are developed as well. Although current
legal regulations permit the use of VMS signs, it is done by replicating fixed signs
(the same road signs designs). According to the authors, there are no obstacles pre-
venting variable content signs to be actually used as such. For example, a sign may
require individual vehicles to change lanes, which will eventually lead to changing
their routes in the transport network or to change their speed. Such an approach
enables to adjust traffic flow organisation to the actual traffic in a similar manner to
what is currently achieved by traffic lights (but in the proposed approach it is larger
information capacity). Nevertheless, the number of contents may be much larger than
in the case of classical light signalling. This in turn allows for dynamic traffic flow
organisation in the road network adapted to the actual traffic.
The proposed dynamic traffic flow organisation in specific transport network pro-
files provides better conditions for public transport. At the moment, the limiting
factor is the lack of specialised control systems and physical space to designate sep-
arate lanes for public transport vehicles. According to the proposed method, while
organising traffic in the road network, the system should know what priority needs to
be applied for public transport vehicles. The means of transport will be matched with
the number of events in the network as described in the further part of the chapter.
Traffic control system is capable of separating traffic in time and space and the traffic
flow organisation is capable of separating different modes of transport, provided it
is based on variable content and operates according to data acquired in a manner
described in the chapter.
Changes of traffic flow organisation implemented using the proposed method
can be transferred as feedback to users in information displays and, according to
the technological advancement of Industry 4.0, in the form of direct messages sent
to their mobile equipment, navigation devices, etc. Those communication channels
are crucial since they help users to adjust to the new configuration of the road net-
work. This will consequently reduce the number of hazardous situations. The rate
of changes depends on actual needs and intelligent traffic flow organisation should
reduce congestion.
3 Source of Data and Industry 4.0
So far, various methods have been applied to determining of demand for transport
in the transport network. The discussion presented is limited to passenger transport
only. Surveys of transport behaviour among citizens are an important source of
information. Such surveys enable to establish traffic flows between regions and/or
within the transport network (Ortúzar and Willumsen 2011). Survey data enable to
adjust public transport offer and to a certain degree influence traffic flow organisation
in the transport network. However, due to limited frequency of such surveys, they
have a limited influence on traffic flow organisation, and hardly any influence on
traffic control. The above surveys are supplemented by those which examine traffic
flows from the point of view of traffic control systems. In the case of road traffic, the
surveys may help to optimise algorithms used in the traffic control system usually
on a microscale. In the case of rail traffic, the surveys help examine utilisation of
capacity on specific sections of the rail network and lead to better adjustment of the
transport offer to actual needs in the transport network (as regards development of
desired capacity matched with rolling stock available).
Surveys focus on the following terms: ‘actual’ and ‘transport network’. On the
one hand, all those surveys are implemented in considerable intervals that make it
impossible to react to actual changes of processes concerned (i.e. statistical traffic
flow organisation). On the other hand, the surveys cover the transport network or
its immediate vicinity. Thus, they are always partial, since the distribution of traffic
depends on a number of factors that are disregarded by the survey (Szarata 2013).
Industry 4.0 involves automated collection, processing and exchange of infor-
mation (with emphasis on the latter) (Faheem et al. 2018; Grzybowska and Łupicka
2019). It is also done with the aim of traffic flow organisation in the transport network
(Kijewska et al. 2016). In this context, it is worth noting that every socio-economic
event, apparently not related directly to the transport system, may potentially influ-
ence traffic flow organisation in the transport network. We witness such an influence
when an event can be registered by available technology, especially mobile devices
supported with functionalities provided by GPS and GSM. Another requirement is
the possibility of defining the relationship between the event and traffic flow organisa-
tion in the transport system while determining its time and place, as well as various
categories of the event (various databases describing event). The problem, in this
case, is mainly the reference of the relation of this activity to the future load of
the transport system. This translates into a specific function of influence of specific
activities generated in the socio-economic system on the transport system. Below
the article lists some examples related to the utilisation of the transport network.
A client buying a product in the point of sales not only identifies the route in the
chain of manufacturer–supplier–vendor–recipient, but also does it with the connec-
tion to external databases (e.g. national identification numbers, banking systems),
determines locations (or potential locations) for the consumption of the product,
as well as a number of additional parameters. At the same time, the client defines
parameters for several related activities (means of transport, time of day, accom-
panying people, profession, etc.). Thus, while using modern technologies, used for
the registration of the event in time and space, the influence of the event can be
measured with the precision on the level of one/several roads in the transport net-
work. While quantifying activities in time and/or space (in relation to other activities),
we may attempt to determine the influence on traffic flow organisation in the road net-
work (function of influence), and match demand and supply in the transport network
through feedback channels. Such balancing can be secured by traffic flow organisa-
tion referred to in the title of the article (both traffic flow-based and road sign-based
traffic flow organisation). For this purpose, it is necessary to create variable traffic
flow organisation for transport infrastructure in specific sections of the road network.
An example of the above is a system based on information acquired from mobile
phone operators (e.g. call detail record—CDR) (Valerio 2009). Such data directly
define actual traffic in the transport network and daily changes in the traffic. Such
Fig. 1 Trip planner—main GT planner window (Source Own research)
data are provided by subscriber’s calls, as well as procedures related to changes in the
location area code (LAC). Traffic flows between areas of the network controlled by
base transceiver stations (BTS) are reflected in data collected by operators (Sierpiński
and Celiński 2012). Improvements in traffic flow organisation in specific components
of transport infrastructure can be linked with such data. The precision depends on
the size of network units within the area of a given mobile phone operator. The more
advanced technology, the smaller those units are.
Another example of using such data for traffic flow organisation in the trans-
port network is a trip planner. Trip planners enable fast and intuitive search for a
route between two points defined by the user in the transport network (Jaunzems and
Lektauers 2013; Borkowski 2017; Sierpiński 2017). Between the origin and desti-
nation. Frequently, the used also defines intermediate locations (i.e. POI––Points of
Interest), if certain matters need to be dealt with in locations before the destination is
reached. Figure 1 presents GT Planner which is one of the outputs of the international
project of Green Travelling under the ERANET programme funded by the National
Research and Development Centre. The trip planner application can be used (usu-
ally thorough website) to obtain data describing transport behaviour among citizens
and their travelling needs within a given area. Trip planners can be integrated with
meta search engines. The program (website, service) based on a meta search engine
searches simultaneously through several search services (planners). Archived data
usually cover origins, destinations and means of transport selected by the planner
user. Spatial information is usually linked with trip commencement and completion
time. In the case of public transport, travelling time information is precise since it is
based on actual timetables often defined in their digital format, e.g. General Transit
Feed Specification (GTFS) (https://developers.google.com/transit/gtfs/). Such data
are reliable and they describe transport behaviour from the point of view of time and
space. In the case of individual transport, such data apply to the beginning and end
of the trip. Frequently, during the interaction between the user and the planner, it is
possible to acquire information about user transport preferences. An example of the
Fig. 2 Trip origins and optimised routes in selected area and example of input data (Source
Sierpiński et al. 2016)
above is information about preferred modes of travelling in the transport network,

e.g. green, fast, safe. The first option means that the user prefers ecological means of
transport. The second one, shows that the user is interested solely in terms of reach-
ing a desired destination. The third one means that the user focuses on trip safety. In
such a mode of operation, it is possible to define precise parameters of user transport
behaviour. Data from session registration (service user session) help to improve the
organisation of the transport network (Sierpiński et al. 2016) (Fig. 2).
Another example is Internet-based timetables for public transport. Transport
behaviour profiles are determined as in the case of trip planners. Increasingly
often, the configuration of the web-based route finder enables to determine trans-
port behaviour not only in terms of distance covered but also travelling time. For
example, rail operators search engines request users to define the travelling time in
narrow period.
The same is true for such activities as searching maps in other cities using a
mobile device and the Internet (location search), finding fuel stations, ticket pur-
chase/inspection, change of base location to actual position of mobile phone, any
electronic payment especially when related to goods consumption in specific loca-
tion (facility), use of info kiosks, etc. All those activities enable to determine transport
behaviour profiles. To a large probability, we may assume that the list of such activities
is going to expand in the global and mobile society. The above activities determine
the potential for improving traffic flow organisation in specific components of the
road network by identifying the locations of certain activities.
It is worth considering some basic questions related to the transport system. Does
the socio-economic system generate a specific event and what major parameters
does the event implies from the point of view of the transport network? Those basic
questions are as follows:
Where?—information directly linked with the location.
When?—information regarding time.
Who?—information related to the subject involved.
What?—information concerning parameters of the event detected by modern equip-

ment and technologies (purchase of goods or services, change of means of transport,
phone call, payment, etc.).
By linking such information with other data in various databases and owners
(banking systems, GPS, GSM, city information systems, timetables, national iden-
tification numbers, system of Central Registry of Vehicles and Drivers, System of
Registering of Accidents and Collisions, other GIS systems, etc.), those questions
(who, where, when and why) can be further extended:
Where from? (origin), i.e. place of domicile/work of the user,
Where to? (destination), i.e. place of domicile/work of the user and what are his/her
usual destinations,
How often? (Historical data about travelling and activities of the user),
For what? (Banking system information about transactions),
Facilities applicable? (Mobile phone network, BTS on the route),
With whom? (Correlation of data in space and time with other users within the same
information systems).
Facilities related to travelling can be determined using popular spatial databases.
Open access databases include, for instance, popular Open Street Map (OSM) (http://
wiki.openstreetmap.org). An example of commercial databases is Google Maps
(http://maps.google.pl). One may also use the Geographical Information System
(GIS) in a given city or metropolis (Hu et al. 2016). An example of object location
based on OSM is presented in Fig. 3.
Provided relevant data are acquired from existing databases (aggregation and
acquisition of data is a challenge), a precise question (where, when, who…etc.)
enables us to define parameters for complete transport chains in the transport network.
In those transport chains, the variation of trips can still occur, e.g. due to imprecise
measurement. One of the telemetric systems is the mobile phone network. In the
case of large GSM cells (in GSM networks show tendency to reduce the size of
basic cells), the precision with which a trip is recorded may lead to variations for a
given transport chain. Another positive fact is that the size mobile phone network
cells correspond to transport network density indices. In the case of large GSM cells,
usually, the transport network is usually less dense.
Figure 4 presents a method for defining parameters of activities in the socio-
economic system, which can be used to define transport chain parameters by asking
relevant questions. Thus, it is possible to adjust to those data to traffic flow organ-
isation on specific sections of transport infrastructure as regards transport chains.
This requires data mining, exchange and processing according to the principles of
Industry 4.0 (Grzybowska 2012; Dalenogare et al. 2018; Zezulka et al. 2018). We
can achieve a full integration of the subject with surrounding IT systems, which in
this particular case, become in fact telemetric systems.
Figure 5 presents links between databases that can be used for the identification of
trips in the transport network. The figure lists major IT systems which may contain
information necessary to define parameters of trips. However, all of them can hardly
be listed, since their number is still growing.
Fig. 3 Example of OSM data presented in the map (key/amenity = fast_food) (Source https://
overpass-turbo.eu/# © Open Street Map)
Fig. 4 Identification of trips by linking databases (PESEL—Universal electronic system for

registration of the population, BIK—Credit Information Office, BIC—Business Identifier Code,
CEPIK—Central Register of Vehicles and Drivers, OSM––Open Street Map, GIS—Geographic
information system) (Source Own research)
Fig. 5 Data exchange

(Source Own research)
As presented in Fig. 5, there can be many patterns of acquiring information about

an event in the transport network. It depends on available databases, majority of
which are or should be public.
4 Section Function of Event Influence on Traffic Flow

Organisation
In the opinion of the authors, in the transport network and in its socio-economic
environment, each event that can be recorded and influence future traffic in that
network should be taken into consideration while organising such a network. In
practical terms, it is possible to determine parameters for traffic flow organisation at
any section transport network from the point of view of events that may influence
the traffic at a given section. Improvements to the efficiency of the transport network
cannot be made at all points simultaneously since iterations are necessary for the
process. Discrete profiles are selected for consecutive improvements, profiles which
are situated at a certain distance to each other. An event that may influence the
transport network can be determined using modern telemetric techniques with the
accuracy level up to:
– place of event,
– time of event,
– subject generating event and
– object related to origin of event.
After exchanging such data with external databases, an event can be further
described by a number of additional parameters, such as
– origin of subject (e.g. place of registration, domicile),
– destination, determined in the transport system or forecasting based on additional
parameters,
– objects relevant for event and
– economic parameters describing event, etc.
Once we define the transport network in a geocentric system, we may determine

distance j of the profile, for which traffic flow organisation is provided in a dynamic
setting, from place e of the event, both in space and to specific elements of the network
infrastructure:
e : {sgj , snj }, sgj = snj (6)
where
e event number [−]
j profile number [−]
sgj distance in geocentric system [m]
j
sn distance by network elements [m].
The event impact area is not limited to a single profile, but can actually influence
future traffic flow organisation in several different profiles of the network. Based
on travelling time at specific sections, we can determine the expected arrival time
of an object that generates an event to profile j of the network from the point of its
identification:
t pj = (t p1 − t pj ) + t p2 +, . . . , t pi , + · · · + (t pm − t pm ) (7)
where
j
tp expected arrival time to profile where traffic is organised [s]
t pi i travelling times [s] from the place of event to the profile
j
t p travelling time based on distance to the location of the profile on section [s]
t p m
travelling time based on distance to the location of the place of event on section
[s].
In the context of (7), the issue is to determine travelling times on sections of the
road network. The parameter shows major fluctuations during a day. Nevertheless,
such information is available in telemetric systems. Similar data can be accessed in
Google Maps. The accuracy is sufficient to estimate the arrival time from the place
of event to the measurement profile.
Based on notifications of consecutive events by the same subjects, generated in
other locations in space, we can determine a route on which the subject reaches a
specific profile in that road network.
In practice, due to several options in the transport network, a subject initiating
an event may appear at one of a set of possible profiles. The number of variations
exceeds 2 or 3 only in very dense and inhomogeneous transport networks. Whether
a user appears in a given profile of the transport network depends on additional
parameters that describe trips (e.g. motivation, history). It should be emphasised that
an average is to be drawn from parameters of registered notifications in particular

profiles, since the goal is to reduce the cost of traffic flow organisation from the
point of view of the entire system rather than individual trips. Additionally, traffic
flow organisation should ensure a relevant modal split. Therefore, once we know
time, place and routes of a given subject, we can implement a relevant traffic flow
organisation using elements of transport infrastructure. It is described by the section
function of event influence on traffic flow organisation in a given profile as follows:
Fwj = f (snj , t pj , SM, xe , ye , te , xd , yd , xs , ys , FF, HD) (8)
where
xe , ye Coordinates of place of event (WGS 84)
te time of event
xd , yd coordinates of destinations taken from databases
xs , ys coordinates of origin
FF financial attributes of event taken from relevant databases
HD historical information about trips.
In a certain area of the network, each element involved in dynamic traffic flow
organisation has a set of influence function values available (for all major events for
given profile, average is calculated for events registered):

SFwj = Fej (9)
where
SFwj set of events in transport network of certain influence function value higher
than zero for profile j
j
Fe events e influencing profile j.
In (9), the set of function parameters can be supplemented in various ways with
information about the manner of travelling by a party generating an event in the
transport network. For this purpose, average speed of the subject can be determined
for a given moment (based on various systems and databases). It is also possible
to use historical information or information from client sessions in the trip planner
or any other similar device in which the subject declared his/her preferred means of
transport. It should be emphasised that in rush hours on a single lane and given profile
under dynamic traffic flow organisation, we may have from 1000 to 1800 vehicles,
movement of which can be linked to dozens of thousand events in the socio-economic
environment of the transport network (Big Data sets).
In each of profiles, we may define the expected modal split which results from
the characteristics of subjects generating events significant for a given profile:
j,zn j,zn j,zn
EMS j = SM1 : SM2 : . . . : SMi : . . . SMnj,zn (10)
where
zn number of events identified as significant for profile j.
Thus, the modal split is determined by using artificial intelligence (AI) while
analysing data from registered events. The description of the use of AI methods
while processing events to obtain information about the modal split extends beyond
the framework of this article and it is going to be discussed in a separate publication.
If in a given profile of the transport network, we have more than one lane and it
is a profile before a node with possibility to change directional and type structure,
the profile can be used for shaping the justified modal split by using vertical signs
(VMS).
Passenger cars or cars with conventional engines (not electric or hybrid) can be
directed to other profiles in the transport network. For this purpose, it is possible to
place a dynamic turn sign for vehicles of certain type (it is assumed that according
to Industry 4.0, such signs are to be designed). The process can be implemented not
only from the point of view of a given road cross section, but also from the point of
view of the modal split on certain sections of the network and its entire space:
E M S net = SM1zt : SM2zt : . . . : SMizt : . . . SMnzt (11)
where
zt number of events in entire transport network.
In the case of (11), the dynamic traffic flow organisation in terms of selecting a
modal split applies to the entire transport network simultaneously.
5 Discussion
In the road network, vehicles move in an unregulated manner and it is a typical

stochastic process. Junctions fitted with traffic lights are locations where traffic can
be controlled on limited distances. After leaving a junction with traffic lights, after
leaving the intersection with the traffic lights, there is a dispersion of the traffic
flow. The further from the junction, the more random traffic becomes and equal
access to traffic for vehicles is no longer possible. We also lose the influence on
the characteristics of the traffic flow. Such a network can be described by the Nash
equilibrium (Bressan and Han 2011). The distribution of traffic flows in the transport
network is developed in such a way that for each route the average cost of transport
is minimum and equal to the one used by that traffic flow. Since there is no global
traffic flow organiser, the cost of the system is not optimised. A change in the route
does not increase benefits for the user. Such situation is true assuming that the traffic
is not controlled, characteristics of transport network infrastructure elements are
defined and the traffic flow is homogenous. According to the Nash equilibrium, the
distribution of traffic w the transport network can be described as follows (Jacyna
2008):
∀(a, b) ∈ R ∀ p, q ∈ Px>0 c (X ) = cq,ab (X ) = α ab α ab → min

ab p,ab
(12)
where
q alternative route.
As long as the method presented in the chapter enables to introduce dynamic
changes of traffic flow organisation on specific sections of the transport infrastructure
and sections can ‘self-improve’ based on information about trips, we are close to
minimising cost of traffic flow distribution from the point of view of the entire
network (its organiser). It depends on the possible function of traffic flow organisation
for each user. When very large number of elements of infrastructure can adjust to
dynamic changes in the transport network, no user who fails to follow those changes
can increase their benefits. It is similar to the situation describing the Stackelberg
equilibrium (Jacyna 2008; Groot et al. 2012):

f (X ) = c p,ab x p,ab ∗ x p,ab →∼ min (13)
(a,b)∈R p∈P ab
where
f (X ) function describing minimum cost of transport on all routes (for all events).
It is related to the fact that the entire space of the network under such organisation
enables to increase benefits while deviating from a specific form of traffic flow
organisation (imposed by organiser who has information about all (or almost all)
associated events in transport network) in the transport network (apart from possible
legal consequences of failure to respect laws). At least in the case of the modal
split, we become close to minimising cost for the system. In the case of individual
transport, the stochastic nature of the process is going to be more strictly limited.
However, we should remember that in the case of breaking traffic regulations, road
events and accidents will make major difference between minimum and actual costs.
Therefore, it is possible to conclude that dynamic changes in traffic flow organi-
sation, which is an important element of transport network, can produce benefits for
the entire city. The city and its efficient transport network is a function of the goal
of changing traffic flow organisation in specific elements of infrastructure. Needs
of users, which are identified by various elements of the Industry 4.0 system, is the
basis for general improvement of cost in the transport network and the quality of its
operation. Of course, in a number of instances, the transformation of the network in
the global scale brings benefits for individual users as well.
6 Conclusions and Final Comments
A major advantage of the method is its holistic approach, in which information

important for traffic flow organisation in specific profiles of the transport network
originates from a large number of sources, including those located beyond the trans-
port network. Such information not only provides new data, but also integrates those
data using new or modified vertical signs in the transport network. A major role is
played there by the concept of Industry 4.0 which, sooner or later, will be adopted
in the road network.
Another advantage of the method is the fact that while organising the network, the
managing body will no longer use a narrow range of information about the network
(geometric parameters) and traffic events. The latter comprises a narrow group of
examples of various occurrences in the network. The method presented in the article
enables to analyse traffic flow organisation in a much broader sense, and since it
is holistic, the network is treated as a whole by extending the analysis beyond the
transport network and taking into account various events (including those not related
directly to transport, variable sections of network).
Yet another advantage of the method is created by the possibility of using it (data
obtained) when designing and planning of the transport network. There, data can be
used at a very basic level while developing the transport network, and taking into
account principles of sustainable mobility (Jacyna et al. 2013).
A major downside of the solution is that data analysed originate from commercial
databases managed by private institutions, such as banks, mobile phone operators. In
general, such data are not made available, including their anonymous form. However,
considering the development of Industry 4.0 and information technologies, it should
be noted that the exchange of data is going to be an indispensable component of
each process. Therefore, the problem is limited to accessing relevant data sources
and appropriate data processing.
Acknowledgements The selection of the present research has been financed from the means of
the National Centre for Research and Development as a part of the international project within the
scope of ERA-NET Transport III Future Travelling Programme ‘A platform to analyse and foster
the use of Green Travelling options (GREEN_TRAVELLING)’.
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Attractiveness of the Region
in Connection with Intermodal
Transport Development
Lilla Knop and Marzena Kramarz
Abstract Intermodal transport, as exemplified by numerous studies, is very impor-

tant for sustainability development of the industry. Individual regions should strive
to develop these transport technologies, which use physical resources of the region,
geographic shape, communication routes, etc. This matches the concept of sustain-
able development of the region, particularly through the impact on the reduction of
external transport costs. Thus, the purpose of the chapter is to identify and evalu-
ate the criteria shaping the attractiveness of the near-border region from the inter-
modal transport development point of view. Modified Emerald model was used to
study the region attractiveness and the evaluation was based on statistic indicators,
description data and estimates of experts. The chapter is an attempt and introduction
to wider studies concerning the regions’ attractiveness in the context of develop-
ment of intermodal transport and determination of its maturity level in cross-border
region TRITIA. Future plans involve performing studies within different near-border
regions within the scope of TRITIA cooperation and verifying indicators subjected
to evaluation.
Keywords Sustainability transport · Ecosystem · Cooperation in regional

network · Cross-border transport · Transport development
1 Introduction
Theories of regional development mean almost 150 years of history, starting with
neoclassical theories of growth, through conservative theories of local and regional
convergence, theories of structural changes, institutional and socio-economic theo-
ries, theories of innovation and knowledge, up to neoclassical theories of endogenous
growth and competitiveness and clusters (Pike et al. 2011). At the moment, regions
develop smart specializations, i.e. a concept according to which region development
L. Knop (B) · M. Kramarz

Silesian University of Technology, ul. Akademicka 2A, 44-100 Gliwice, Poland
M. Kramarz
198 L. Knop and M. Kramarz
is affected by its potential, assets, so-called region specializations. The basis for spe-
cialization identification is the identification of own resources, cooperation network,
human potential as well as R&D&I. The concept of smart specialization puts greater
emphasis on innovations and concentrates the limited human and financial resources
within a few areas competitive to global scale in order to excite the economic growth
and wealth (Olko and Brzóska 2017). Polish regions have not only identified smart
specializations but also constantly developed them. In this case, it was important not
only to identify the strengths of the region but also to evaluate its attractiveness from
the standpoint of new specializations development. Śl˛askie Province develops three
key smart specializations: medicine, energy and ICT as well as new ones, focused
around new material technologies and environment protection as well as develop-
ment of the TSL sector. The TSL sector becomes more important from the intermodal
transport development perspective, which in fact, besides smart specializations, is
underlined in the European developmental policy. The intermodal transport means
transport of cargo within a single cargo unit or vehicle, using successively different
branches of transport without reloading the cargo itself in the changing transport
branches, based on a single transport contract for which one entity is held responsi-
ble—intermodal transport operator (Crainic and Kap 2007).
Intermodal transport, as exemplified by numerous studies, is very important for
sustainability development of the industry (Grzybowska et al. 2014). Individual
regions should strive to develop these transport technologies, which use physical
resources of the region, geographic shape, communication routes, etc. This matches
the concept of sustainable development of the region, particularly through the impact
on the reduction of external transport costs (Awasthi et al. 2014). Moreover, regions
located within cross-border areas are predisposed but also have needs in order to
become leading regions in the sector of intermodal transport development. Thus, the
purpose of the chapter is to identify and evaluate the criteria shaping the attractive-
ness of the near-border region from the intermodal transport development point of
view. Modified Emerald model was used to study the region attractiveness and the
evaluation was based on statistic indicators, description data and estimates of experts.
The chapter is an attempt and introduction to wider studies concerning the regions’
attractiveness in the context of the development of intermodal transport and deter-
mination of its maturity level in cross-border region TRITIA. TRITIA aims to use
the significant cooperation potential, which all cooperating regions, i.e. Moravian-
Silesian Region, Silesian and Opole and Žilina self-governing regions dispose of,
through the creation of functional cross-border governance structures and making
use of the cooperation projects identified in the course of the creation of the strategy
as well as the three bilateral strategies. In order to fulfil the objectives formulated
in the strategy, the cross-border cooperation involves all potentially relevant actors.
In the chapter, we tried to answer two research questions: 1. Which factors decide
about attractiveness of a region from the standpoint of intermodal transport? Is the
Silesian Province, as a near-border region, attractive from the intermodal transport
development point of view? Creation and development of the cross-border territory
rely on cooperation in the following four areas: transport and infrastructure, eco-
nomic cooperation, tourism, energy and environment. The article consists of three
Attractiveness of the Region in Connection with Intermodal … 199
key parts: theoretical, research and synthesis. The first theoretical part presents key
definitions and relations between the attractiveness of the region and the development
of intermodal transport in the cross-border area. In this part, the methods of assess-
ing the attractiveness of the region were discussed. Part of the research includes the
identification of indicators evaluating the region’s attractiveness for the development
of intermodal transport and their expert evaluation for the Silesian Province. The
synthesis part presents research results and final conclusions.
2 Attractiveness of Regions Versus the Essence

of Intermodal Transport
Attractiveness of a region can be generally defined as the ability of the territorial

system of being perceived as competitive (e.g. for potential investors). You may
say that regions compete with each other with the degree of their attractiveness for
potential investors or the development of new sectors. Regional attractiveness is
a complex concept and covers many factors important from the standpoint of the
analysed problem, e.g. potential investments, regional specializations or performed
economic operations (Godlewska-Majewska 2011). On the other hand the growing
concern about sustainable development has an increasingly greater impact upon the
Supply Chains and TSL sector (Grzybowska 2011).
The chapter is focused on the development of intermodal transport, which both
by practitioners and theoreticians of the logistics management is identified as a
chance to reduce external costs of transport, thus as a chance to improve regions’
attractiveness. Council Directive 92/106/EEC (directive on combined transport) is the
sole legal instrument at the Union level that directly encourages to transfer from road
transport to different types of transport of lower level of emission, such as inland
navigation, maritime and railway transport. It is to increase the competitiveness
of the cross-border intermodal transport, comparing to only road cargo transport.
Intermodal transport is interpreted as transport of cargo within a single shipment
unit using different types of transport branches (UN/ECE 2001), however, the main
part of the transport should be performed using railway transport, inland and maritime
navigation, air transport and the beginning and/or end section using road transport,
within the shortest time possible (Finger and Holvad 2013; Feder 2018). Narrowed
share of road transport for supply and return operations is justified in the concept
of sustainable transport, more ecological and competitive economy, such as this
implemented within the scope of the strategy Europe 2020 (Hyard 2013; Kozłowski
et al. 2018; Golińska and Kawa 2015).
The market of intermodal carriage is young in Poland and characterizes with
minor, but constant development. At the moment, Poland is ranked 11 among the
Union countries in terms of the weight of cargo transported using intermodal trans-
port. Development potential of this transport in Poland is considerable all the more
that the European Union drives at gradual replacement of road transport with mar-
itime and railway transport. The results of using intermodal transport are usually
divided into three groups: economic, ecological and social. Economic results con-
sist mostly in reducing operational expenditures (fuel, time of drivers work, etc.),
longer life of trucks, limiting road tolls (motorways, tunnels, etc.), less wearing of
the roads. Ecological results are especially related to reduced pollution of the envi-
ronment through the reduction of exhaust gases and noise emission and diminished
external costs of transport. Social results are related to traffic safety improvement.
In order to understand the methods of region attractiveness, it is necessary to
mention a few models related to studying competitiveness and attractiveness of
a given area. One of the most common ones is the Porter Diamond Model or R.
Florida concept of creative class; moreover, there are many reports being published
on competitiveness. In the studies, the Extended Emerald model was used, devel-
oped by Sasson and Reve (2012). The diamond model (Porter 1990) has been used
widely in studying the competitive advantage of regions. In this model, a region has
a competitive advantage based on its factor conditions, demand conditions, existence
of strong related and supporting industries, and firm strategy, structure and rivalry.
The underlying argument in the creative class thesis is that as talents and creative
people become a crucial resource for knowledge-intensive production (technology),
the quest for talent and creative people increases. Contrary to traditional resources,
talents and creative people are mobile, that is why we should be tolerant (Hansen
2007). The Emerald model has six dimensions and one moderator. The dimensions
in the model are educational attractiveness, talent attractiveness, R&D and innova-
tion attractiveness, ownership attractiveness, environmental attractiveness and cluster
attractiveness. The model has been originally developed to evaluate the attractiveness
of a location to attract foreign direct investments (FDI) and was previously used in
the assessment of health industry (Sasson 2011a), oil and gas industry (Sasson and
Blomgren 2011), metals and materials industry (Sasson 2011b) and telecom industry
(Vinje and Nordkvelde 2011).
3 Indicators of the Region’s Attractiveness: Assumptions

of Research
Studies of attractiveness of the region in the context of intermodal transport develop-

ment are based on the Emerald model, presented by Sasson and Reve. It is preferred
and used as frames diagnosing and describing a given state of affairs because it is
based mostly on chronological data and facts. Moreover, it allows for illustrating
general development or change of situation. This way, the authors have evaluated the
potential of the cluster (Sasson and Reve 2012), but also development of the sector
in a specified area. Based on such assumptions, the modified Emerald model was
used in the paper to evaluate attractiveness of the region in the context of intermodal
transport development. The proposal concerning adaptation of the Emerald model to
evaluate attractiveness of the region is not a new solution because such studies have
been performed earlier.
The proposal to change the model and process of studies is based on two key dis-
criminants which are not present in the classical evaluation of region attractiveness.
First, you evaluate a region from the perspective of developmental opportunities of
not one but a few sectors (according to Polish Classification of Activities—intermodal
transport consists of a few sectors); and second, you take its near-border geographic
location into consideration. Based on these assumptions, the studies also included six
planes of region attractiveness evaluation in the context of intermodal transport devel-
opment: infrastructure attractiveness, human capital attractiveness, R&D&I attrac-
tiveness, ownership attractiveness, environment attractiveness, cooperation and net-
work attractiveness. Modification of the Emerald model consisted of merging the
attractiveness of education and talents in the plane of the attractiveness of human
potential. The attractiveness of infrastructure and physical resources has been added
as a new platform. Instead of attractiveness of a cluster, attractiveness of cooperation
and network relationships was detailed.
In the plane of the attractiveness of infrastructure, as it results from studies related
to development of intermodal transport, the basic indicator of evaluation is reload-
ing terminals. In this case, one mentions not only the number of available terminals
in the region but also their capacity, location and level of satisfying technical and
technological requirements. Within the nodal infrastructure, it is important to indi-
cate storage areas, including number, capacity and degree of concentration. From
the demand point of view, storage areas are nodes in the logistic network, which
generate cargo streams (and among other things decide about their frequency and
utilized branches of transport). The infrastructure of container terminals is mostly
located within the regions of concentration of storage and industrial infrastructure.
Another set of indicators included in the plane of the infrastructure attractiveness
are factors describing linear infrastructure. The availability of different transport
branches as well as density and quality of roads is important for intermodal transport
development. Characteristic of evaluated indicators is presented in Table 1.
The second plane of the region attractiveness evaluation is the attractiveness
of human capital. Among the key factors describing this area, based on a classic
approach, you differentiate the number of employed persons in the sectors related
to intermodal transport and average remuneration. The supply of specialists, man-
agers and sector experts is also an important factor. Moreover, from the standpoint of
building future human capital, the number of persons studying and learning in post-
secondary schools on logistic, transport and similar faculties are separated. Table 2
presents results and criteria of this plane evaluation.
As mentioned before, evaluation within the R&D&I plane emphasizes the poten-
tial of competitiveness and innovation of the region. Basic data that may be identified
and evaluated for the purposes of the development of intermodal transport is the num-
ber of patents within this scope and number of universities and research centres. An
important factor describing the scope of innovation implementation is the number
and level of implemented new technologies, number of innovations and innovative
Table 1 Indicators of infrastructure attractiveness

Indicator Evaluation index
Infrastructure attractiveness
Number of intermodal terminals Insufficient (1), average (2), sufficient (3)
Linear infrastructure—road transport Insufficient (1), average (2), sufficient (3)
Linear infrastructure—railway transport Insufficient (1), average (2), sufficient (3)
Linear infrastructure—inland navigation Insufficient (1), average (2), sufficient (3)
Air infrastructure (cargo transport) Insufficient (1), average (2), sufficient (3)
Storage areas Insufficient (1), average (2), sufficient (3)
Level of satisfying the technological requirements Low (1), average (2), high (3)
Sources of information Statistical data, reports about region attractiveness
Source Own studies
Table 2 Indicators of human capital attractiveness

Human capital attractiveness
Number of employed persons Decline (1), stabilization (2), increase (3)
Average remuneration Below the national average (1), the national
average (2), above the national average (3)
Supply of qualified personnel Insufficient (1), average (2), sufficient (3)
Availability of managerial personnel Insufficient (1), average (2), sufficient (3)
Availability of experts Insufficient (1), average (2), sufficient (3)
Number of students on logistics, transport and Insufficient (1), average (2), sufficient (3)
similar faculties
Number of secondary school students on the Insufficient (1), average (2), sufficient (3)
mentioned faculties
Source Own studies
companies within section H (transport and storage economy) of the Polish Classifi-
cation of Activities. Moreover, evaluation of region developmental policy continuity
and coherence with politicians of the near-border regions seems to be essential. In the
process of creating and implementing innovations, business environment institutions
play an important role thus, the indicator of entrepreneurial and technological incu-
bators number and technology transfer centres. Table 3 presents results and criteria
concerning evaluation of the R&D&I plane attractiveness.
In the plane of ownership attractiveness, indicators pointing to the development
of the TSL sector within a given region were combined with indicators of the region
investment attractiveness. Evaluation of the TSL sector development requires con-
sidering both the number and dynamics of companies performing transport and stor-
age services. The third separate category is the level of the logistic centre maturity.
Table 3 Indicators of R&D&I attractiveness

R&D&I attractiveness
Number of patents Low (1), average (2), high (3)
Number of universities and research centres Insufficient (1), average (2), sufficient (3)
Number of entrepreneurship incubators, Insufficient (1), average (2), sufficient (3)
centres of technology transfer, etc.
Number of innovations Low (1), average (2), high (3)
Number of innovative companies Low (1), average (2), high (3)
Implementation of new technologies Insufficient (1), average (2), sufficient (3)
Continuity of development-favouring policy Lack of continuity (1), jumping (2),
continuous (3)
Integrity of policy with adjacent cross-border Low (1), average (2), high (3)
regions
Source Own studies
Of course, logistic centre can be included among organizations performing trans-

port and storage services. However, due to comprehensiveness of the performed
services, container terminal and availability of three transport branches (road, rail-
way and inland navigation), it is found that the organization is of key importance for
the logistic development of the region. Factors pointing to investment attractiveness
include also the level of sector maturity, level and offer for new investments as well
as industrial risk. Maturity of the sector is a factor which on the one hand shows
the general maturity of the TSL sector (that is the dynamics of companies, innova-
tiveness, dynamics of prices and labour costs, etc.) and on the other, such maturity
must consider detailed component—maturity of the TSL sector within intermodal
transport. The level of investment is a factor affecting the industrial development of
the region, thus it does not have to be considered exclusively through the prism of
investment in the area of transport and logistics. Industrial risk, however, is analysed
by future investors and represents one of the key factors affecting the decision about
investing in a given region. Table 4 presents indicators evaluating the attractiveness
of ownership.
The environment attractiveness plane is a set of factors describing the first and
foremost macroeconomic and demand conditions. With reference to the original
model, the set of indicators in this plane is much greater. Within this area, macroe-
conomic conditions (political, social, economic, international and geographic) and
the level of strategic program implementation are evaluated. The latter is of a special
meaning because it refers not to the essence of the programs but to the level of their
implementation. Intermodal transport is frequently mentioned as a developmental
multi-sector; however, the number of successfully implemented projects is small.
From the demand standpoint, two indicators are distinguished, one local—showing
the number of industrial and service companies in the region, which may use the offer
Table 4 Indicators of ownership attractiveness

Ownership attractiveness
Number of transport companies Low (1), average (2), high (3)
Level of logistic centre maturity Low (1), average (2), high (3)
Dynamics of number of the companies providing Low (1), average (2), high (3)
storage services
Dynamics of income from transport and storage Low (1), average (2), high (3)
services
Sector maturity Initiative (1), development (2), maturity (3)
Level of investment (scale) Low (1), average (2), high (3)
Functioning and updated complex offer for Insufficient (1), average (2), sufficient (3)
investors
Industrial risk Low (1), average (2), high (3)
Source Own studies
of intermodal transport, the other describes the dynamics of demand for intermodal
transport. In the first case, one tries to evaluate regional and cross-border demand,
and in the second, one point to the character of the trend. The set of indicators and
method of their evaluation are presented in Table 5.
The sixth plane of region attractiveness evaluation is cooperation and network
relationships. This group combines factors related to the TSL sector networking
both to the country and international scale with factors related to the cooperation
of companies with institutions at the national and regional levels. A decision has
Table 5 Indicators of environment attractiveness

Environment attractiveness
Political considerations Inappropriate (1), moderate (2), favourable (3)
Social considerations Inappropriate (1), moderate (2), favourable (3)
International considerations Inappropriate (1), moderate (2), favourable (3)
Geographical considerations Inappropriate (1), moderate (2), favourable (3)
Level of strategic programs implementation Low (1), average (2), high (3)
Number of production and trade companies Decrease (1), stabilization (2), increase (3)
Level of market saturation/demand for Low (1), average (2), high (3)
transport and logistics services
Brand of the region at the national and Poor (1), moderate (2), recognizable (3)
international field
Source Own studies
been made to separately treat clusters and the remaining business networks. In clus-
ters created through combining companies, scientific and research institutions and
business environments, entities benefit mostly from intensive transfer of knowledge.
They also allow for developing common development strategy. Because of geograph-
ical closeness, companies help to create solid bonds and strengthen the feeling of
responsibility for the region. This, in turn, facilitates building the cluster brand and
recognizability of the cluster in the world enhances attractiveness of a region and
favours foreign investments. Another form of cooperation is creation of more or less
formalized relationships between the TSL sector companies. Motives related to cre-
ating logistic networks are different, starting from the exchange of information, e.g.
about ‘empty runs’ through mutual investment in logistic infrastructure, implemen-
tation of logistic projects or even common implementation of the whole processes.
So-called virtual networks are best developed, as manifested by the increasing mean-
ing of freight exchanges. Growth of network relationships within the TSL sector
favours the transition to intermodal technologies. The cooperation of companies
with regional institutions is a key factor in the development of intermodal transport
in a region and country. Organizations of the TSL sector, as mentioned before, are
key beneficiaries on the intermodal transport map. Development of common rules,
listening to the needs, application of different types of incentives and specification
of regulations within the scope of intermodal transport are key premises showing the
importance of this factor in the evaluation of attractiveness of the region in terms of
development of intermodal transport.
4 Evaluation of Śl˛askie Province Attractiveness

in the Context of Intermodal Transport
Development—Studies’ Results
Within the past few years, Śl˛askie Province has been one of the most attractive
provinces in Poland from the investment attractiveness standpoint. This is confirmed
with a high GDP generated by the region. This affects a series of factors mostly
related to natural resources of the province, which have dominated the economic
development of the region. Main assets of the province are as follows (investment
attractiveness of regions 2013—2017):
• The largest urban complex in Poland, creating a unique investment potential.
• The largest communication node in Poland, favouring industrial development, and
• numerous cooperation relationships. Good communication is ensured by Interna-
tional Airport ‘Katowice’, A4 motorway, E40 road (European route), E75 road
(European route) and direct railway connections with the following cities: Berlin,
Vienna, Budapest, Bratislava, Prague, Moscow and Hamburg.
• The most industrialized region of Poland of traditional specializations, however,
subjected to effective restructuring.
• Numerous economic sub-zones, offering attractive investment terrains.
• Major fields of studies within the province are oriented at exact sciences and
technical faculties (Cz˛estochowa University of Technology and Silesian University
of Technology) which fact results mostly from the features of the regional economy.
• The province shows significant investment potential as confirmed byvery
• Highrates of potential and actual investment attractiveness for national economy,
capital-intensive and labour-intensive industry, trade, tourism, financial agency,
services for business and education.
• High work ethos.
The objective of Śl˛askie Province is to become a region of differentiated,
modern economic structure oriented not only at production solutions but also first
and foremost at the wide spectrum of services. Creativity and innovativeness of com-
panies operating within Śl˛askie Province are therefore emphasized in the strategic
documents for Śl˛askie Province (Regional Innovation Strategy 2014–2020) and the
policy for economic development for Śl˛askie Province. Strengthening the role of
Śl˛askie Province economy within international values chains), three basic smart
specializations have been differentiated: medicine, energy and ICT and through
the entrepreneurial discovering—(Smart Specialization Platform) modern materials,
environment protection, and transport and logistics. Current geopolitical situation
and Internet technologies have changed the TSL sector development paths. This
underlines the necessity to observe, evaluate and design the TSL sector development
in Śl˛askie Province. Moreover, considering the meaning of geographical location,
Śl˛askie Province plays a significant role in the TSL development within the cross-
border system. Taking this into consideration, the region attractiveness, based on
the modified Emerald model, has been evaluated. Table 6 presents the evaluation of
the region attractiveness indicators within individual planes, considering the adopted
scale. The evaluation is of expert character and results from the analysis of the source
data assigned to the analysis of individual indicators (Table 7).
Table 6 Indicators of cooperation and network attractiveness

Cooperation and network attractiveness
Number and activity of clusters Low (1), average (2), high (3)
Level of TSL sector networking Low (1), average (2), high (3)
Freight exchange Low (1), average (2), high (3)
Activity of self-government institutions in winning investors Low (1), average (2), high (3)
Activity of government institutions within the scope of Low (1), average (2), high (3)
intermodal transport development
Cooperation of regional institutions at the national and Low (1), average (2), high (3)
international level
International cooperation of companies Low (1), average (2), high (3)
Sources of information Statistical data, reports about clusters, attractiveness, investments,
Source Own studies
Table 7 Attractiveness evaluation of Śl˛askie Province

Indicators Evaluation
1. Infrastructure attractiveness
Number of intermodal terminals 2
Linear infrastructure—road transport 3
Linear infrastructure—railway transport 2
Linear infrastructure—inland navigation 1
Air infrastructure (cargo transport) 2
Storage areas 3
Level of satisfying the technological requirements 2
Average 2, 1
2. Human capital attractiveness
Number of employed persons 2
Average remuneration 1
Supply of qualified personnel 1
Availability of managerial personnel 2
Availability of experts 2
Number of students on logistics, transport and similar faculties 3
Number of secondary school students on the mentioned faculties 2
Average 1, 86
3. R&D&I attractiveness
Number of patents 1
Number of universities and research centres 3
Number of entrepreneurship incubators, centres of technology transfer, etc. 2
Number of innovations 1
Number of innovative companies 1
Implementation of new technologies 1
Continuity of development-favouring policy 2
Integrity of policy with adjacent cross-border regions 1
Average 1, 37
4. Ownership attractiveness
Number of transport companies 3
Level of logistic centre maturity 2
Dynamics of number of the companies providing storage services 3
Dynamics of income from transport and storage services 3
Sector maturity 2
Level of investment (scale) 2
Functioning and updated complex offer for investors 2, 5
(continued)
Table 7 (continued)
Indicators Evaluation
Industrial risk 2
Average 2, 44
5. Environment attractiveness
Political considerations 2
Social considerations 2
International considerations 2
Geographical considerations 2
Level of strategic programs implementation 2
Number of production and trade companies 2, 5
Level of market saturation/demand for transport and logistic services 2
Brand of the region at the national and international field 2, 5
Average 2, 12
6. Cooperation and network attractiveness
Number and activity of clusters 1
Level of TSL sector networking 2, 5
Freight exchange 3
Activity of self-government institutions in winning investors 2
Activity of government institutions within the scope of intermodal transport 2
development
Cooperation of regional institutions at the national and international level 2
International cooperation of companies 3
Average 2, 2
Source Own studies based on Atrakcyjność inwestycyjna regionów (Investment attractiveness of
regions). Warszawa (2014, 2015, 2016, 2017)
4.1 Infrastructure Attractiveness
The average value of the expert evaluation of infrastructure and physical resources
attractiveness is 2.1. Individual factors were evaluated according to principles given
in the above section. Linear infrastructure and storage areas obtained the highest
rates. Śl˛askie Province belongs to regions of the highest provincial road density indi-
cators per 100 km2 . Dolnośl˛askie Province is the only region with higher density.
According to the Provincial Roads Development Plan in presenting the diagnosis
of linear infrastructure concerning road transport, sections of roads in good condi-
tion—52.3%, sections of roads in unsatisfactory conditions—34.3% and sections
of roads in poor condition—13.1% (Intermodal transports in 2017). This means
that significant investments that have been performed within recent years do not
solve the problem of road capacity, especially within highly-urbanized areas. More-
over, good transport availability of the region is affected not only by routes but
also by very high density of road infrastructure (Śl˛askie Province came sixth in the
transport availability ranking). This region is one of the best-communicated regions
in Poland. Silesian agglomeration, wherein A1 and A4 motorways cross, plays a
very important role in the communication system. The dominating direction in the
agglomeration is the east–west direction along which A4 motorway and Drogowa
Trasa Średnicowa (DTŚ) route run, wherein the total traffic may reach within close
future, in Katowice, ca. 150 thousand vehicles per day. One must also notice the
transit location of the region, where the Paneuropean transport corridors run, guaran-
teeing expressway network development: corridor III (Berlin–Wrocław–Katowice–
Cracow–Lviv); corridor VI (Gdańsk–Katowice–Zilina).
Another highest rated indicator is the storage area availability. Śl˛askie Province is
the leader in the storage areas in Poland. The supply and demand for storage areas in
Śl˛askie Province increase annually by 11% on average with simultaneous reduction
of vacant premise indicators.
The next factors have been evaluated at the level of two points. This concerned
the number of among other things intermodal terminals. Śl˛askie Province consid-
ers itself well developed from the standpoint of available intersectional reloading
terminals (6 out of 37 terminals located in Poland are located in Śl˛askie Province).
This mostly covers four reloading railway terminals of intermodal character. These
are Cargosped Terminal Kontenerowy (Gliwice), Euroterminal Sławków Sp. z o.o.,
PCC Intermodal—Terminal PCC Gliwice and Polzug Terminal D˛abrowa Górnicza.
Moreover, it is necessary to mention the port in Gliwice, operating within the scope
of the Śl˛askie Logistics Centre and International Airport Pyrzowice, which devel-
ops cargo services. Intersectional reloading terminals are focused in the central belt
of Śl˛askie Province. According to annual reloading capacity, marine terminals are
included in the highest group (over 500 thousand TEU), including DCT Gdańsk,
BCT Gdynia, GCT Gdynia; the second group (200–500 thousand TEU) includes
two terminals from Śl˛askie Province: Euroterminal Sławków and PCC Intermodal
Gliwice. The next Silesian terminals are included among the lowest groups in respect
of reloading capacity. It can be said that the reloading capacities of the container
terminals in Śl˛askie Provice are high against the background of the whole country,
but still not enough in order to ensure efficient intermodal transport, as clearly seen
by comparing this data with different countries.
The linear infrastructure of the railway transport, also rated 2, shows not the
improper density but poor technical condition of the infrastructure. The number of
cargo wagons, including platforms, has increased within recent years. This is a posi-
tive fact that shows increasing meaning and utilization of railway transport, including
intermodal. In Śl˛askie Province, where the network density is 2.5 times greater than
average (Śl˛askie Province—15.9 km per 100 m2 ; country—6.1 km per 100 m2 ), there
is ca. 50% of the national railway transport services performed. The share of elec-
trical lines in Śl˛askie Province is 85% and this is one of the highest indicators in the
country within the scope of railway network electrification. However, there are many
speed limits in the railway network of the Silesian Province, which are caused by
the general poor technical condition of tracks, inadequate geometrical arrangement
of tracks and poor condition of junctions. Lines of unsatisfactory technical condition
represent 54.5% of all railway lines in Śl˛askie Province, and lines of poor technical
condition 0.8% (according to PKP PLK S.A. data).
Cargo air transport, despite a good position in Poland, has a relatively low posi-
tion in the global market. The international airport Katowice–Pyrzowice, Śl˛askie
Province, plays an important role in cargo transport because it ranks first in the
country among regional airports—the volume of cargo traffic in 2015 exceeded 16
thousand ton. Pyrzowice handles six cargo forwarders (all-cargo and courier) and is
the element of the transport corridor BAC–Baltic–Adriatic.
The condition of inland navigation infrastructure is the bottleneck for the dynamic
development of intermodal transport. The problem of the inland navigation fleet in
Poland is its age. The major part is from the 50s through the 80s of the last century.
Arrangement and length of inland watercourses in Poland remained on a similar
level for years. The specificity of this infrastructure and navigation conditions affect
the indicators of demand for inland navigation transport, including relatively low
capacity of barges as well as low number of carriage services.
The presented characteristics aspire to evaluate the level of technical requirements
satisfaction. The infrastructure, first and foremost linear, is partially obsolete and
requires additional significant outlays.
4.2 Human Capital Attractiveness
The second plane of region attractiveness involves the evaluation of human capital,
in case of which the average rate is 1.85. Employment in Śl˛askie Province in 2016
was almost 1.8 million persons, whereas 6% was employed hired in section H (over
112,000). This is the fourth section in the region in respect of employment, behind
mining and winning (ca. 60%), trade (14%) and construction (6.9%). Employment
in this sector constantly grows in relation to 2015, i.e. 5.7% which is the highest in
the region. As a result, despite the low number of the employed in relation to all
employed persons in the region, it is worth to underline the systematic increase in
employment, resulting from the growth of demand on the TSL market. Compared to
the whole country, employment in Śl˛askie Province in the logistic sector is rated very
high—the second location in the scale of the country after Mazowieckie Province,
which fact strongly emphasizes development of the sector.
In turn, average remuneration in Śl˛askie Province amounts 6600 PLN; in the sec-
tor of transport and logistic service, the average is only 3,740 PLN and is one of
the lowest remunerations against the background of the remaining sectors of Śl˛askie
Province economy. This is definitely a weakness, which despite systematic growth of
remuneration, causes increased fluctuation of employees within this sector and trans-
fer to other branches of the economy or leaving the country, where the employees of
this sector are offered much better conditions. Moreover, in Śl˛askie Province, 20% of
transport companies suffers from lack of steady drivers, and over 60% struggles with
periodical problems concerning assembling full personnel for transport operations
which fact poses a major threat to the sector of transport, both road, railway and
inland. The demand not only for drivers but also traders and storeroom managers
increases.
The availability of managerial personnel is much better, however, intensive devel-
opment of logistics and growing demand for experienced specialists with suitable
competences cause that within some areas of the logistics where the employee market
term is used more and more often. The availability of experts is enough. This results
not only from the number of experts working within the region but also from the wide
cooperation of experts from the whole country and abroad. The number of students
is a very positive factor. Demand for this faculty is constantly growing; ca. 1000
students graduate every year the transport and logistics faculty in the province. The
logistics faculty in the Silesian University of Technology has won the ‘Perspektywy’
award 2 years in a row. However, the situation is completely different in relation to
the post-secondary school graduates. Lack of proper sector-oriented schools causes
shortages in specialized employees of low and medium level on the TSL market.
4.3 R&D&I Attractiveness
The Polish TSL sector does not characterize with a high level of innovativeness.
The average rate in this sector is 1.375. It has been noticed that among the existing
innovations, most of them are transferred from the industry and not generated by the
logistics sector. The TSL sector, against the background of service operations, cannot
be perceived as distinguishing. This is evidenced by insignificant number of patents,
innovations and number of innovative companies. In Śl˛askie Province, in relation
to all innovations within the region, only 1% of product and 1% of process innova-
tions have been implemented. The situation is better in case marketing (3.6%) and
organizational (5%) innovations. Compared to other sectors, the innovative activity
of companies is much weaker in favour of the existing adaptations of sometimes
obsolete solutions proposed by investors. At the same time, one must notice the lack
of complex studies showing the complete innovativeness of the TSL sector against
the whole region, thus the missing information on the continuity of developmen-
tal policy. However, you may observe that the meaning of the TSL sector within
regional strategies grows, and transport and logistics are among the group of new
regional specializations. Unfortunately, in this context, you cannot see the cohesion
policy with neighbouring cross-border regions—Opolskie Province, Moravia-Silesia
regions and Zilina region in Slovakia. Even though they cooperate within the Euro-
pean Grouping of Territorial Cooperation (EGTC) under the name TRITIA and a
few projects have been started, the effects are still negligible.
4.4 Ownership Attractiveness
The group of factors within the ownership attractiveness plane has been rated 2.4.
This high-rank results mostly from the number of TSL sector companies located in the
province and the level of income they generate. The number of companies operating
within the H section Transport and Storage Economy in Śl˛askie Province amounted
25,595 in 2017 (2016—25,496, 2015—25,314). This means annual increase of 1%
in the region, the same as at the country-wide level. The number of entities within
section H in Śl˛askie Province represents 11% of employment within this section in
Poland (second place, behind Mazowieckie Province) and means 6% of all companies
registered within the province. This value was very similar within the previous years.
This is reflected by poor dynamics of companies’ number growth, however, it is
still significant compared to the rest of the country. The reports show that Śl˛askie
Province is very well developed from the standpoint of logistics operators active in
its area. The region distinguishes by this fact against the country. The largest global
logistics operators operate in this region, e.g. DB Schenker, DPD Polska, Rohlig
Suus Logistics SA, JAS-FBG SA, Grupa Raben, Kuehne + Nagel, DHL, Dachser and
many more. Forwarders with the largest share in the intermodal transport also operate
in the region: PKP Cargo, Lotos Kolej, DB Cargo Polska. There are many distribution
centres in Śl˛askie Province (e.g. distribution centres of many chain companies such
as Biedronka, Lidl, Rossmann and Decathlon). However, the available reports do not
provide the difference between storage objects and distribution centres, thus it is not
possible to specify the accurate number of distribution centres. Śl˛askie Province is
showed as a region with very well developed storage areas. The following cities can
be mentioned—Katowice, Mysłowice, Gliwice, Chorzów and Sosnowiec. Śl˛askie
Province is now the second in the country in respect of demand for and supply of
storage areas. The number of storage areas and the distribution centres themselves
has a growing tendency and the region is constantly showed as one of the most
competitive ones from the standpoint of new logistic investments.
The total income of all companies quoted in 2017 in the country ranking was
close to 22 billion PLN, however, the total income within the H section of the Polish
Classification of Activities is ca. 10 times higher. The pace of growth of companies
that were included in the ranking, as measured by TSL operations income, was twice
as high in 2017 compared to GDP growth and amounted 13% (11% in 2016). The
average income in Śl˛askie Province is at the level of 10–13% of the country average
and represents significant share in the TSL market. Dynamics of income growth
concerned both the sector of industry and services which fact is a good forecast
for the sector. This enforces continuous developmental activities. New investments
constantly appear in the region. At the same time, Śl˛askie Province is mentioned
as one of the most attractive regions from the investment attractiveness point of
view. It came first in terms of investment attractiveness in the country, the highest
level of attractiveness—TSL. The climate for foreign investment is stable in Poland
(Poland with stable climate for foreign investors). Performed studies showed that
92% of foreign investors are glad to have invested in Poland and would do that again.
The investment climate in Poland is rated by foreign investors to 3.7 points (in 1–5
scale), which is one of the best rates in the history of ranking. Economic stability
and large internal market are the main assets of Poland as the location for foreign
investments. The areas that need to be improved are changing legislation, prolonged
court proceedings and complicated tax system.
At the moment and in the past, there are no complex studies over the TSL mar-
ket maturity. One must consider in this case partial data concerning transport, TSL
market and intermodal transport in Poland. This is especially difficult to transfer
this knowledge to a single province. Experts underline that the Polish market of
distribution, logistic, transport and forwarding services are, according to analysts,
completely balanced and mature This is affected by a few key factors, first and fore-
most the relatively stable political and economic situation. Experts convince that
geopolitical matters, such as membership in the European Union, contributed to the
fact that Poland is called a logistic operator in the region (Entropoland, Ranking
of TSL companies). Industrial risk in Śl˛askie Province is determined as relatively
low (in relation to other regions in Poland), however, against the background of its
neighbours, such as Czech Republic and Slovakia, Poland is somewhat worse. This
is mostly related to the level of VAT and income taxes or more liberal principles of
determining tax-deductible expenses.
4.5 Environment Attractiveness
The average attractiveness of the environment for the development of intermodal

transport is quite high (2.1). Political conditions are favourable—both at the Euro-
pean Union, country and regional level, and there are coordinated programs being
developed in favour of limitation of harmful impact of transport through integration
of transport policy with ecological polity. Regulations given in the White Book on
Transport (2011) and Green Book (2013), provide for striving to attain a competitive
and energy-efficient transport system. In Poland, in the Responsible Development
Strategy (2017) or Program for Silesia (2017), sustainable development of transport
is underlined. The disturbing fact is the scope of the proposed activities which are
called unreal by some of the experts. On the other hand, part of the projects does
not find investors, funds or cooperation and is postponed to the following years.
Within the international environment, wide-ranging policy concerning development
of transport corridors is pending. Śl˛askie and Opolskie Province, as well as Moravia-
Silesia regions and Zilina region in Slovakia, have been cooperating for over 4 years
within the scope of the European Grouping of Territorial Cooperation (EGTC) under
the name TRITIA. The level of this cooperation concerns determination of oppor-
tunities, assumptions related to cargo transport development within all forms—both
using the road and railway network as well as air and water transport. Analyses are
to assist in preparing large infrastructural projects within the whole area of near-
border regions. However, cross-border approach to the development of the transport
system is poorly underlined and implemented. The issues related to integration of
transport within the near-border areas are not widely discussed. It seems that it is a
result of building a hierarchic strategy which fact leads to polarization of regional
strategy towards national direction, and marginalization of local and regional trans-
port initiatives. Social conditions favour development of intermodal transport within
the studied region. Considering the external costs (congestion, noise, accident rate,
environment pollution and area occupancy), pressure towards modification of cargo
haulage increases, not only in Śl˛askie Province. Geographical conditions are also
conducive. The linear infrastructure mentioned above and general land shape allows
for stable development of intermodal transport. Mountain areas in the south part of
the province, mining damage and climate, which can reduce the utilization of water
courses, can be a limiting factor.
The number of companies in the region increased by 1% and amounted 425,693
entities in 2017 (which is 11% in the country—two locations after Mazowieckie
Province). This represents the grounds for TSL services development, including
intermodal services. The demand for transport and logistics services is at a very
high level. This is a result of the largest urban complex in Poland, very high level
of population, high degree of urbanization and well-developed industry reporting a
demand for complex and specialized services. The region is very well developed from
the standpoint of the number and type of economic entities offering a wide spectrum
of services on the market. In this context, one may expect high level of income attained
in the region on the sale of TSL services. In spite of significant level of the TSL
service development in Śl˛askie Province, it still has major developmental potential
in this region in the future. In many papers (P), it is underlined that the market will
continuously show significant needs within the scope of developed logistics activity.
This proves high absorption of the market and incomplete saturation of the market
with TSL services.
Śl˛askie Province is a recognizable region on the map of Poland and Europe. Due to
geographic location, investment attractiveness, infrastructure, level of human capital,
physical and material resources, it is an important region in intermodal transport
development.
4.6 Cooperation and Network Attractiveness
The last group of factors—the attractiveness of cooperation and network relation-

ships have been rated 2.2. In Śl˛askie Province, both transport clusters (Knop 2015)
and logistic clusters have been established, however, they are of no significance
for the development of intermodal transport. Nevertheless, logistics companies use
different forms of networking. They create both formal and informal relationships
with other players of the logistic network. They are also participants of virtual net-
works and freight exchange. The rate is reduced by the level of cooperation between
self-government institutions and logistic companies.
One may notice the increased activity of government institutions within the scope
of supporting the intermodal transport development, including the intermodal relief,
which has been paid to cargo forwarders since 2014. This is given in the regulations
of the ‘Contract concerning financial support of railway infrastructure management
and its protection within 1 January 2014–31 December 2017 from the state budget’
concluded between the Minister of Infrastructure and Development (now Minister
of Infrastructure and Construction) and PKP PLK.
The international cooperation of companies is very highly rated. Major operators
are organizations of global outreach, who must cooperate with other members of
the logistic network around the world in order to implement their basic goals. Less
important actors cooperate in order to increase comprehensiveness of the provided
services and widen the geographic outreach.
5 Discussion
Evaluation of individual platforms of the attractiveness of the Śl˛askie Province in the

area of intermodal transport development allowed for drawing synthetic conclusions
resulting from the performed studies—Fig. 1.
Expert’s opinion showed that planes describing the attractiveness of ownership,
infrastructure and cooperation are valued the most in the region. Surrounding is a
set of factors that positively affect development of intermodal transport in Śl˛askie
Province. This, however, does not mean that there are no improvement needs within
this scope (infrastructure, especially railway and inland); however, the plane of
human potential and R&D&I have the lowest rate. Unfortunately, as the forecasts
show, companies in the region, especially the TSL sector, will struggle with shortage
of employees for a few more years. The situation related to remuneration is quite
different. Its level is unsatisfactory compared to the national or regional average in
Fig. 1 Śl˛askie Province attractiveness in area of intermodal transport development. Source Own
studies
the sector. The improvement within the R&D&I sector is crucial for coherent devel-
opment of intermodal transport. Innovative operation within this scope seems to be
most important. With current demand for the TSL services, the pressure is negligible,
however, the future of the sector development requires innovations, e.g. innovative
distribution and storage centres, implementation of digitization and autonomous
trucks.
6 Final Conclusions
At the moment, under market relationship conditions, the meaning of the regional
economy has increased and the near-border regions play an important role in the
development and intensification of integration processes between different countries.
The chapter did not answer the given question, however, it initiates a discussion on a
system-based development of intermodal transport. Therefore, it is not enough to use
the limited set of data in order to obtain reliable image of both short-term and long-
term forecasts. The proposed methodological approach to the evaluation of region
attractiveness allowed for evaluating the near-border region condition through imple-
mentation of systematic and complex approach. One must remember that transport
companies are direct beneficiaries of intermodal transport as their operators. Alike
in case of available storage areas or distribution companies, they may but do not
have to be participants of intermodal transport. These are the groups of beneficiaries
where the direct incentives concerning participation in intermodal transport should
be directed to.
In the future, the authors intend to focus their studies around the following:
• Evaluation of the remaining near-border regions within the TRITIA cooperation
in the context of intermodal transport development.
• Verification of the adopted methodological approach, including indicators of cross-
border regions’ attractiveness evaluation and moderate dimension.
• Evaluation of intermodal transport maturity from the regulation change perspec-
tive.
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Smart Glasses in Sustainable Manual
Order Picking Systems
Brigita Gajšek and Nataša Vujica Herzog
Abstract The concept of sustainable development is gaining attention in all spheres

of our life. Especially in production environments, it is important to reduce environ-
mental impact and improve working conditions while still increasing economic value.
This comprehensive effort roughly describes sustainability that we address on the
example of manual order picking system, which is a part of many production sys-
tems. These systems have the potential to introduce new technologies, which require a
judgment on the sustainability of the action, through the perspective of sustainability.
One of the technologies with a great potential for use in order picking process are
smart glasses, which integrates the core functionality of a smartphone in a pair of
glasses. They are classified as a head-mounted device. As such, they are among
the modern technical widgets with great expectations about their usable value in
framework of Industry 4.0. Until now, only some practical examples in industry are
described in literature. Order picking “man-to-goods” workplaces are an example
of working environments where humans are still central actors and determine their
effectiveness and efficiency (Gajšek et al., Proceedings of MOTSP international con-
ference, Zagreb. Croatian Association for PLM, 2017a; Gajšek et al., Organizacja
i Zarz˛adzanie 72:45–61, 2017b). Full automation still will not be rational in the
near future. Order picking activities are labor-intensive and time consuming. Smart
glasses could be one of the means to improve working conditions and human-friendly
rise in productivity. When working in a warehouse as order picker, having both free
hands and information displayed in natural vision field is a progress in ergonomics
and can help increase picking performance. In parallel, order pickers can be easily
supported by any distant expert from any wired location, alerted to environmental
hazards, acquainted with the achievement of a personal plan and more. Smart glasses
could completely take over a function of a central personal information source. New
questions arise with inflating expectations and expansion of their use in practice, such
B. Gajšek (B)
Faculty of Logistics, University of Maribor, Mariborska 7, 3000 Celje, Slovenia
N. Vujica Herzog
Faculty of Mechanical Engineering, University of Maribor, Smetanova 17,
2000 Maribor, Slovenia

220 B. Gajšek and N. Vujica Herzog
as the impact of long-term use on employee’s vision characteristics, the impact of dif-
ferent user interfaces, the employee’s perception of the long-term use of the device,
and other. In the chapter, we review scientific literature on use of smart glasses in
manual order picking system and contribute to finding answers to the above questions
by performing an experiment in a laboratory environment with realistic equipment.
Keywords Sustainable logistics · Smart glasses · Manual order picking ·

Productivity · Ergonomics
1 Introduction
Digitalization, digital transformation, and evolving technologies trigger the fourth

industrial revolution or Industry 4.0 that is characterized by the extensive network-
ing of products, devices, machinery, vehicles, workplaces, ICT systems, enterprises,
and human resources. Everything is becoming smarter. The data collected is grow-
ing. For the first time, production can use a variety of (evolving) technologies. The
technological upgrade is interesting because of its ability to bring the information
to the worker in an immediately applicable form, to the workplace where he/she is
located and exactly at the time of need. The effect must be double, namely increased
productivity and preserved or improved well-being of workers. An example of such
technological achievement are smart glasses, a kind of head-mounted display. They
have their own processor and are powered by on the frame-attached battery. A dis-
play is placed in the visible area of left or right eye. The data is collected from a
wireless network and projected onto a tiny screen. Users do not use hands to access
computer-generated data while moving, routing to storage locations, receiving/giving
voice/video messages, rapidly receiving data in the form of symbols or images and
last but not the least fine-routing with help of augmented reality. All these most
likely influence on economic, environmental and social aspects. Smart glasses are a
research-interesting technology with noticeable increase in number of publications
per year (based on WoS; 43 publications in 2014 and 465 publications in 2017).
Smart glasses as an enabler of augmented reality are also included in the Gartner
Hype Cycle for Emerging Technologies 2018 (Panetta 2018). Augmented reality is
in phase of “Trough of Disillusionment”. This means that surviving providers are
trying to improve their model of smart glasses to the satisfaction of early adopters.
In addition to Industry 4.0, the concept of sustainability now has an influence
on a wide variety of global debates. Like the rest, the production is also scrutinized
itself for the degree of sustainability. One of the many challenges of moving toward
sustainable production is finding out which options are sustainable and balancing a
plethora of disparate economic, environmental, and social aspects (Azapagic et al.
2016). Web of Science database search returned none result for combine set “smart
glasses” and “sustainability”. The question, therefore, arises as to how the systems
where smart glasses are used can contribute to sustainability.
Smart Glasses in Sustainable Manual Order Picking Systems 221
Our research took place in a logistics production environment, more precisely

in manual order picking. The introduction of smart glasses is being tested through
the perspective of sustainability instead of a picking list that requires the use of
hands during the work. Modern logistics operators are under increased pressure and
administrative regulations in order to fulfill environmental objectives and reduce
congestion (Grzybowska et al. 2014).
In practice, among a multitude of different order picking systems, prevail manual
“picker to part” systems. Despite the available automation, it remains that more than
80% of all orders processed by warehouses are picked manually (De Koster et al.
2007; Burinskiene 2015). Traditionally workers are routed by paper or electronic
picking lists to locations in warehouse racks with stored items where they retrieve
items for orders. This process requires a large amount of manual work and is recog-
nized as the most costly in most warehouses. Its activities amounts up to 55% of the
warehouse total operating costs (Tompkins et al. 1996; Sternad 2018). Picking uses
a large amount of resources, and can reflect around 60% or more of warehouse staff
(Walker 2018). Since traveling between storage locations is up to one-half of the
time spent for preparing a customer order (Tompkins et al. 1996; Ðukić and Oluić
2004), warehouse managers try to reduce or eliminate movements between storage
locations, set up time, and search time. Solutions can be purely mathematical, in
terms of routing and controlled disposal, or technological ones such as the intro-
duction of forklifts, conveyor belts, and lately smart glasses. Despite the first pilot
projects, smart glasses are still evolving technology. Theory (Peli 1996) and practice
(Ames 2017) share opinion that new and advanced models should be tested before
wider use in the warehouses. The question is how we contribute to sustainability by
introducing smart glasses.
2 Theoretical Background
2.1 Sustainable System Framework
According to Wichaisri and Sopadang (2013), the framework for a sustainable

system combines sustainable development with the elements typically included in a
traditional system. By focusing on sustainable development and implementing sus-
tainable sub-systems, for example, logistics system (Wichaisri and Sopadang 2013),
a company can positively influence its long-term performance objectives. A sustain-
able logistics system will enable a company to take steps to insure that its long-term
performance objectives have a positive effect on maximizing its profitability, min-
imizing its environmental impact, and improving the community’s quality of life
or minimizing social impacts (Wang and Zhang 2007; Croom et al. 2009). When
introducing new technology, it makes sense to determine how the technology, for
example, smart glasses, will help achieve these goals. In doing so, it is possible to
rely on the findings of Wichaisri and Sopadang (2013) who deduced from literature
review that sustainable logistics has three perspectives and 15 criteria (Table 1).
Table 1 Sustainable logistics

Perspectives Criteria Sub-criteria
perspectives as proposed by
Wichaisri and Sopadang Economics Quality Quality of product
(2013) Lead time
Responsiveness Demand responsiveness
Cost Manufacturing cost
Logistics cost
Profit Return on investments
(ROI)
Market share
Profit margin on sale
Mobility Intensity of goods
transport
Environment Resource usage Energy usage
Water usage
Land use
Raw material use
Pollution Air pollution
Water pollution
Emission CO2 emission
Waste Waste disposal
Eco-efficiency Product/Service value
Environment influence
Social Health and safety Employee safety
Health care benefits
Quality of life Accident
Education and training
Working condition
2.2 Smart Glasses
Smart glasses or data glasses are an example of head-mounted device that integrates
the core functionality of a smartphone in a pair of glasses. Order picking systems
using this kind of devices are Pick-by-vision systems. Smart glasses enable aug-
mented reality by displaying additional information on top of it. In this way, the
user has free hands. Pick-by-vision systems are further subdivided according to the
making use of tracking technologies on 2D systems that do not track user’s posi-
tion and AR systems that use tracking and make explicit use of augmented reality
(Schwerdtfeger et al. 2009). 2D pick-by-vision systems are enabled to inform the
user with sound and textual information in a form of a list of items or images.
AR pick-by-vision systems enrich worker’s view with the necessary information
(Mazuryk and Gervautz 1996). Due to the great potential of this technology, it became
a focus of many research and development projects at the end of previous century,
also in the area of order picking.
One of the pioneers, Peli (1990), could not prove any potential harmful effects
because of use of head-mounted device with short, 20 min tests in laboratory envi-
ronment. The only limitation was that he did not recommend use of such devices
while driving. From his Peli (1996) point of view, the concerns about possible harm-
ful effects must be present and researched at introduction phase of almost any new
technology. Effects of use of new technology/device on human should be tested
separately for each emerging system.
Already before 2009, Schwerdtfeger et al. (2009) researched the use of head-
mounted devices in the order picking process. They compared the pick-by-vision
system to established methods, namely paper document, pick-by-light, and pick-by-
voice. Comparison of different technologies is also a common practice today in the
academic sphere to motivate its capabilities, and check the user strain besides the
general performance. They were satisfied with results, which we present in Table 2,
although they were not statistically significant. Results largely depend on pick-by-
vision system and not just on the model of head-mounted device (Schwerdtfeger
et al. 2009; Weaver et al. 2010b; Pickl 2014). There is always a way to improve
method’s shortcomings. Pick speed and accuracy with pick-by-vision systems can
be improved by associating colors with shelves and shapes with bins (Iben et al.
2009).
After two decades of research work in 2010, smart glasses have been recognized
as a safe enough technology. Their use spread from laboratory environments to the
first pilot projects in companies. The number of studies that research different tech-
nical designs of head-mounted designs has increased. We are witnessing searching
for synergies between technologies and to the first tries to combine different tech-
nologies to achieve optimum work results. We begin to encounter more studies that
explore. Rammelmeier et al. (2011) reasoned about active prevention of picking
errors by employing pick-by-vision systems. The authors confirmed with laboratory
test, that the provision of information via head-mounted device facilitates an accu-
rate information reception. Head-mounted device enables permanent visibility of the
instructions to the order picker and not just for a short period, as it is in a case of
pick-by-voice.
Most authors of research papers have a positive attitude to pick-by-vision systems
with head-mounted devices. They recognized and proved several cases and system
design specific advantages compared to paper, pick-by-voice and pick-by-light. They
agree that pick-by-vision is promising technology and the effect of long-term use of
smart glasses on worker is still unexplored (Josefsson and Lingegard 2017).
Unlike the current ones, early research works on smart glasses were more special-
ized in a specific sustainable logistics perspective. Peli (1990, 1996) was primarily
focused on health and safety as social sustainable logistics perspective. In this respect,
the user is set to the foreground. Only when it turned out that short-term use of smart
glasses probably does not harm the user, the number of research work researching
Table 2 Scientific literature on smart glasses classified on sustainable logistics perspectives

Authors Perspectives Findings
Ec En So
Schwerdtfeger * * * • Head-mounted systems support the worker with the
et al. (2009) right information at the right time
• Pick-by-vision (AR) could have lover error rate than
pick-by-vision (2D)
• Pick-by-vision systems could have about 10% better
picking time performance than that of the paper list
• After about 1/2 h with the system, subjects did not feel
uncomfortable or constrained
• It was not indicated that working with pick-by-vision
(AR) system caused a higher strain than use of paper
list
• The errors for the pick-by-vision (AR) system
decreased during runtime and increased for the paper
list
• One group of head-mounted device users can make
user input while walking while the other cannot
• Possible problems are headaches, pressure in eyes,
problems focusing on the head-mounted device,
difficulties with text reading
Peli (1990) * • Extended use of the monocular display may result in
changes in the phoria posture and cause asthenopic
symptoms
• Changes in phoria and fixation disparity are more
likely in people who are already symptomatic or who
have various uncorrected visual deficits
• Appearance of asthenopic visual discomfort
symptoms in a user may be regarded a
protective-screening effect, since it appears to uncover
existing latent problems
• Long-term effects are small, since the visual system
tends to recover quickly when the monocular
occlusion is removed
• Although awareness of the environment is maintained
when using the display, it is obviously unsafe to
attempt to use some types of monocular display while
driving
• At work with researched head-mounted device, there
were no evidence of motion sickness or loss of
postural stability in any of the users, standing or sitting
• The image motion noted during saccades is small
• Eye dominance can potentially affect performance
(continued)
Table 2 (continued)
Ec En So
Weaver et al. * * • Head-mounted device (MicroOptical SV-6), as a part
(2010a) of pick-by-vision (AR) system performed better than
the traditional method of text-based paper. The work
was faster than with graphical paper/text-based/audio
version
• Time is saved because both hands are free
• It is important to adjust that the part bins and the
display are at the same focal distance to maintain
constant focus
• Head-mounted device was not significantly harder to
learn than other methods. Text-based version was
harder to learn
Rammelmeier * * • Head-mounted device enables permanent visibility of
et al. (2011) the instructions to the order picker, which can results
in a reduction in error rates
• Confirmation of an item by voice or a button in
combination with checking numbers on the item can
positively influence the reduction of errors
• Wrong picking can be prevented by additional control
mechanism, for example: picking with RFID glove; a
picking trolley with additional sensors, which identify
the collected items during the order picking process;
adding weight or volume sensors into the trolley
Pickl (2014) * * * • Results of comparison of different order picking
methods strongly depend on the use-case
• For specific use-case projection method was the best
one, in regard to overall errors, task completion time
and overall usability
• Errors can be divided on cart, pick, filling, part and
amount errors. At head-mounted device method, the
amount of amount errors and part errors is very low in
comparison to paper/projection/voice method.
Contrary the amount of filling and pick errors is high
• Use of head-mounted device method resulted in a
higher task completion time
• According to NASA Task load Index, head-mounted
device method was the most demanding method for
users. They would not want to use it for a whole
workday
(continued)
Table 2 (continued)
Ec En So
Guo et al. * * * • Head-mounted device is faster than CMD,
(2014) pick-by-light and pick-by-paper
• Head-mounted device is not harder to learn and no
less comfortable than any other methods
• Wrong order bin errors happen more frequently for
pick-by-paper. Missing part errors are frequent at
pick-by-light. No substitution errors happened on
head-mounted device but they happened on CMD
Josefsson and * * * • Compared to alternative methods, smart glasses
Lingegard enable higher quality
(2017) • Smart glasses had great potential to reduce the
cognitive load for the operators
• Transmitted information that operators upload to the
system is not an applicable information type for smart
glasses. A complementary solution is needed
• Displaying experience-based information was
identified as the main potential for smart glasses
• Adding too much or irrelevant information will have a
negative performance impact
• Displaying additional information during picking
could help operator to pick with both better quality
and better ergonomics
• Flexibility could be achieved if operators or managers
can do changes without consulting programmers, as
long as the system supports that
Eco (economic)—productivity/time consumption/flexibility
En (environment)—number of wrong picks
So (social)—ergonomics
productivity has increased. Lead time, responsiveness, time consumption, and flex-
ibility sub-criteria from economic sustainable logistics perspective. Use of smart
glasses has proved to be competitive to paper-based order picking. Smart glasses can
contribute to reduced paper consumption and energy usage. We can say that authors
like Josefsson and Lingegard (2017), Guo et al. (2014), and Pickl (2014) contributed
to clarification of environmental sustainable logistics perspective.
2.3 Manual Order Picking System “Man-to-Goods”
Man-to-goods manual order picking (MOP) systems are systems where the picking
units of different shapes, weights, dimensions and colors are placed in fixed storage
locations and the order picker walks to individual products according to the order list
(De Koster 2004). Compared to automated systems, they prevail and are cheaper at
the implementation phase but more onerous for the employee and management. Our
research focus is on the use of smart glasses in low-level manual picking systems
(Gajšek et al. 2017a, b) in which the order picker picks requested items from storage
racks or bins while traveling along the storage aisle. There is no need for vertical
movements on the higher levels of the warehouse racks. Low-level, man-to-goods
systems employing humans are increasingly labor intensive with up to 1000 picks
per person-hour (Gajšek et al. 2017a, b) and form the very large majority of picking
systems in warehouses worldwide (De Koster et al. 2007). The human enters the
MOP system with his/her unique anatomical, physiological and psychomotor char-
acteristics, which relate to the worker’s physical activity and to a certain degree his
adaptation to the current situation. Work in such flexible systems requires continuous
mental processes whose efficiency, through interactions between humans and other
elements of the work system, influences productivity, quality and worker well-being.
In the MOP system and its roughly predefined organizational structures, policies, and
loose processes employees are faced with a low level of optimization (as compared
to smart automated systems), therefore they are largely left to their own ingenuity
and experimentation. This situation is typical for leftover allocation strategy in which
all functions that can be easily automated should be relegated to machines, and the
remaining functions should be left to the workers (Butlewski 2017).
More than 90% of the literature on MOP planning models in connection to “out-
comes” focuses on minimizing travel distance, total costs and throughput time, while
less than 10% focuses on minimizing the risk of injury, maximizing occupational
safety and improving working conditions (Grosse et al. 2015). According to the
same source, 16.4% of the literature focuses on read/picklist and only 6.9% on other
techniques like pick-by-light/vision/voice. Research emphasizes on economic sus-
tainable logistics perspective, less on social and minimal on environmental.
3 Method
A laboratory experiment (Fig. 1) was used for studying the effects of using smart
glasses Vuzix M300 on specific sustainable logistics perspectives sub-criteria during
order picking activities.
Four shelves at different heights (900, 1170, 1440, and 1710 mm) were among
the 3000 mm long storage rack divided into 60 storage spaces identified with QR
codes in three different sizes (34 mm × 34 mm, 29 mm × 29 mm, and 24 mm ×
24 mm).
Four men and ten women participated in the experiment. Twelve were students
with mean age of 24 years (SD = 1.7) and two women were employed with mean
age of 45 years (SD = 1.41). Each person performed for four hours order picking
activities without a break in the same order for all participants with smart glasses.
Each participant twice passed four ophthalmologic tests, first time before and the
second time after the use of smart glasses. Professional ophthalmologist performed
28 measurements for each ophthalmologic test. He tested visual field, visual acuity,
color test, and contrast sensitivity. Statistical analyses were conducted using
SPSS 21.0. Owing to the small sample size and non-normally distributed data
Fig. 1 Laboratory environment
(Kolmogorov–Smirnov test of normality), we used nonparametric tests (Wilcoxon-

Paired samples test).
Each participant also filled in a questionnaire on the experience of working with
smart glasses. The questionnaire consisted of 15 questions, one of them with 11 sub-
questions asking about possible health problems during the experiment. Responses
were provided in the form of a 1–5 scale.
3.1 Performed Tests
Visual acuity, as the first test in our experiment, according to Levenson and Kozarsky
(1990) refers to “the ability of the visual system to discern fine distinctions in the
environment as measured with printed or projected visual stimuli. The presence of
excellent visual acuity tells the examiner that the ocular media are clear, the image
is clearly focused on the retina, the afferent visual pathway is functioning, and the
visual cortex has appropriately interpreted signals received. Measurement of visual
acuity is the most sensitive test of the integrity of the visual system and fulfills all
standard criteria of a good screening test.” In our research, the visual acuity was
measured separately for each eye (right and left) using the Snellen table.
The second test was checking contrast sensitivity. Contrast sensitivity is the capac-
ity to discriminate between similar shades (Katz 2018). In daily life, good contrast
sensitivity is necessary to see a gray car on a cloudy day, to detect unmarked curbs
and steps, and to distinguish subtle contours on people’s faces to recognize them.
In our research, the contrast sensitivity was measured using the Pelli–Robson table.
According to Katz (2018) the normal result of contrast sensitivity is a value of 1.95
or 2.0. Values less than 1.8 could indicate improper contrast vision in bad visual
conditions.
A visual field test was used according to Boyd (2019) to determine if there are blind
spots (called scotoma) in participants’ vision and where they are. A scotoma’s size and
shape can show how eye disease or a brain disorder is affecting someone’s vision. The
testing was performed with a computer static perimeter using an OCTOPUS machine
at standardized illumination parameters. All measurements were performed with the
program Treshold 30-2 and only on the right eye in front of which the smart glasses’
display was set. To examine changes in the visual field Mean Deviation (MD) and
Pattern Standard Deviation (PSD) were used.
The last was Ishihara test. The participants were tested with help of 15 color
plates. The procedure is used for testing color vision that can indicate the presence
of color vision defects.
4 Results
4.1 Visual Acuity Results
Normal visual acuity for a healthy human is 1.0. Results of visual acuity testing for all
14 participants before and after order picking activities are presented in Table 3. At
11 participants measured visual acuity was more than 0.7. 3 participants had visual
Table 3 Results of visual acuity testing (Vujica Herzog et al. 2018)

Test rVAb lVAb rVAa lVAa
1 0.8 0.8 0.8 0.8
2 1.0 1.0 1.0 1.0
3 1.0 1.0 1.0 1.0
4 0.25 0.4 0.25 0.4
5 0.63 0.4 0.5 0.32
6 1.0 1.0 0.8 0.8
7 1.0 1.0 1.0 1.0
8 1.0 1.0 0.8 1.0
9 0.8 0.8 0.63 0.63
10 1.0 1.0 1.0 1.0
11 1.0 1.0 1.0 1.0
12 0.4 0.4 0.8 0.63
13 0.8 0.8 0.8 0.8
14 0.8 0.63 0.8 0.63
rVAb—right eye, visual acuity, before; rVAa—right eye, visual acuity, after; lVAb—left eye,
visual acuity, before; lALa—left eye, visual acuity, after
Table 4 Results of contrast sensitivity testing (Vujica Herzog et al. 2018)

Test rCSb lCSb bothCSb bothCSa rCSa lCSa
1 1.65 1.65 1.80 1.80 1.65 1.65
2 1.65 1.65 1.80 1.80 1.65 1.65
3 1.65 1.65 1.80 1.80 1.65 1.65
4 1.50 1.50 1.65 1.65 1.50 1.50
5 1.65 1.50 1.65 1.65 1.65 1.50
6 1.65 1.65 1.65 1.65 1.65 1.50
7 1.65 1.65 1.80 1.80 1.65 1.65
8 1.65 1.65 1.80 1.80 1.65 1.65
9 1.65 1.65 1.80 1.65 1.35 1.35
10 1.65 1.65 1.95 1.95 1.65 1.50
11 1.65 1.65 1.80 1.80 1.65 1.65
12 1.65 1.65 1.80 1.50 1.50 1.50
13 1.65 1.65 1.80 1.80 1.65 1.65
14 1.50 1.50 1.80 1.80 1.50 1.50
rCSb—right eye, contrast sensitivity, before; rCSa—right eye, contrast sensitivity, after;
lCSb—left eye, contrast sensitivity, before; lCSa—left eye, contrast sensitivity, after;
bothCSb—left and right eye, contrast sensitivity, before; bothCSa—left and right eye, contrast
sensitivity, after
acuity less than 0.7. Most of the participants have good eyesight before and after
order picking activity.
4.2 Pelli–Robson Contrast Sensitivity Results
The measured value 2.0 shows normal contrast sensitivity, or 100%. If measured
contrast sensitivity is less than 1.5 that points on visual handicap. Further on, if
measured contrast sensitivity is less than 1.0 that points on greater visual impairment.
Results of Pelli–Robson contrast sensitivity testing for all 14 participants before and
after order picking activities are presented in Table 4. All 14 participants had contrast
sensitivity equal to or greater than 1.5. All of them have normal contrast sensitivity.
4.3 Visual Field Testing Results
Visual field testing was used to determine if differences of MD and PSD before and
after order picking activities are significant. Results of testing for all 14 participants
before and after order picking activities are presented in Table 5. They show the dif-
Table 5 Results for visual field (Vujica Herzog et al. 2018)

Test rMDb rPSDb rMDa rPSDa
1 −2.25 3.71 −2.16 2.47
2 −0.71 2.01 −1.05 2.99
3 −4.80 3.24 −3.09 2.54
4 −5.21 2.42 −3.55 2.32
5 0.29 3.10 −2.87 3.19
6 −5.27 3.45 −4.48 3.02
7 −1.68 2.37 −2.77 2.33
8 −1.45 1.97 −3.99 2.18
9 −0.69 1.79 −2.63 2.61
10 −1.39 2.09 −1.07 2.37
11 −3.32 2.15 −3.79 3.15
12 −1.8 2.34 −2.29 1.99
13 −1.99 2.09 −3.15 3.21
14 −5.64 3.62 −0.49 2.34
rMDb—right eye, mean deviation, before
rMDa—right eye, mean deviation, after
rPSDb—right eye, pattern standard deviation, before
rPSDa—right eye, pattern standard deviation, after
ference in MD mean value before (−2.54) and after (−2.67) order picking activities.
The mean value before four hours of order picking activity was 5% higher than the
mean value after four hours of order picking activity.
With Threshold 30-2 and Driver’s licence procedures we also studied the possible
scotomas in the area of the visual field where was a projection of data from smart
glasses. The results can be found in Table 6. Testing recorded for some participants
the presence of scotomas after the use of smart glasses. The presence of scotoma is
recorded with value 1. If the scotoma was not present that is recorded with value 0. The
presence of scotoma indicates that smart glasses can cause some vision impairment
during the use.
4.4 Ishihara Color Test Results
Results of Ishihara color tests for all 14 participants before and after order picking
activities are presented in Table 6. twelve participants had normal color vision. For
two additional participants, impairments in color vision were indicated.
Table 6 Results for Ishihara color test and scotoma presence (Vujica Herzog et al. 2018)
Test CTb CTa Treshold 30-2 Driver’s licence
SCOb SCOa SCOb SCOa
1 15 15 0 0 0 0
2 3 3 0 0 0 0
3 15 15 0 0 0 0
4 15 15 0 1 0 0
5 15 15 0 0 0 0
6 1 1 0 1 0 1
7 15 15 0 0 0 0
8 15 15 0 1 0 0
9 15 15 0 0 0 0
10 15 15 0 1 0 0
11 15 15 0 1 0 0
12 15 15 0 0 0 0
13 15 15 0 1 0 1
14 15 15 0 0 0 0
CTb—Ishihara color test, before; CTa—Ishihara color test, after; SCOb—scotoma, before;
SCOa—scotoma, after
4.5 Statistical Analysis Results
The results from statistical analysis for all four performed tests can be seen in Table 7.
Statistically significant differences appear when value for p ≤ 0.05. Significant cor-
relations are presented with bold records.
The participants’ sight was tested with measurement of visual acuity among other
tests. Their sight was weaker after the use of smart glasses than before. The results
of t test and Wilcoxon test show that this correlation is significant for left and right
eye.
Comparison between right and left eye shows that visual acuity of the right eye
was reduced more than in the case of left eye. Because the display on smart glasses
was placed in front of participants’ right eye, we assume that weaker sight on the
right eye could be caused by use of smart glasses.
The mean values of contrast sensitivity for both eyes were lower after using smart
glasses, but analyze did not prove the significance of this correlation. Measured
values were not lower than 1.5, consequently, we can not argue that the use of smart
glasses is harmful to eye contrast sensitivity (Karatepe et al. 2017).
High values of PSD represent the scotomas (Karatepe et al. 2017). The Threshold
30-2 Program and the Driver’s license test confirmed the increased level of scotoma
in the right eye. We can conclude that the presence of scotoma in the right eye can
be the result of load caused by using smart glasses but further research is needed.
Table 7 Results from statistical analysis (Vujica Herzog et al. 2018)

Before order After order p (t test) P (Wilcoxon test) Effect size
picking activity picking activity
Mean SD Mean SD
VAR 0.820 0.242 0.757 0.245 0.020 0.041 −0.38
VAL 0.842 0.210 0.786 0.234 0.024 0.039 −0.39
CSR 1.628 0.054 1.596 0.095 0.189 0.18 –
CSL 1.617 0.063 1.564 0.096 0.055 0.059 –
CS 1.778 0.080 1.746 0.111 0.189 0.18 –
CT 13.143 4.737 13.143 4.737 – 1.00 –
MD −2.542 1.950 −2.670 1.171 0.822 0.470 –
PSD 2.596 0.675 2.622 0.409 0.904 0.975 –
ST 0 0 0.428 0.513 0.008 0.014 0.45
VAR—visual acuity, right eye; VAL—visual acuity, left eye; CSR—contrast sensitivity, right
eye; CSL—contrast sensitivity, left eye; CS—contrast sensitivity, both eyes; CT—colour test;
MD—mean deviation; PSD—pattern standard deviation; ST—scotoma, Threshold 30-2
We noticed some changes in sight characteristics after 4 h use of smart glasses,

some of them are even significant. Although we can not claim that use of smart
glasses negatively influences on human well-being. Used test are rather subjective,
with results that depend on the willingness of test subjects to collaborate.
4.6 User Experience
Each participant filled in a questionnaire on the experience of working with smart

glasses. Learning to use smart glasses was quick. Six participants (42.9%) gained
the necessary skills in less than 15 min and the remaining eight in less than an hour.
The adjustable display on smart glasses was for all participants set in front of the
right eye. None of the respondents had a feeling of unbearable problems with the
left or right eye. 35% of the respondents did not report problems with left eye during
the work, 29.3% had slight problems, and 35.7% reported bearable problems. Left
eye problems occurred mainly due to the need to close the left eye while reading the
text on the display in front of the right eye. Three (21%) of 14 respondents stated
that the closing of the left eye was necessary to sharpen the image on the display.
The experience for the right eye was slightly worse. 78% of all respondents reported
problems with the right eye during the work. Three of them marked problems as
minimal, for one person problems were almost unbearable, 7 (50%) reported bearable
problems. Six respondents mentioned problem with blurred image on the display,
in addition, individually they further mentioned fatigue of the eye, dryness, burning
sensation in the eye and the appearance of double vision.
Due to the intensity of the work, it was necessary to power smart glasses with an
additional external battery, which each user together with power cable installed to the
most suitable place, for example in the back pocket of trousers. In this way, the drop of
energy under the operational requirement did not disturb the work. For 64.3% of the
respondents wearing extra battery was not a problem. During the work, they forgot
that they are carrying it. 14.3% of respondents had a feeling of slight interference,
while the remaining 21.4% rated the carrying of the battery as disturbing. While
wearing smart glasses, power cable between the main unit and additional external
battery causing slight problems. Some users had got caught up in close-up objects
from time to time, like shelves or cart. Cable caused additional concern for the
participants, who had to be careful not to get caught, stumble, or unintentionally
unplugged it. Such and similar concerns distract the order picker’s attention and
reduce concentration.
Users were disturbed by the weight of the external battery attached to the platform
of smart glasses. At 9 (64%) of respondents pain occurred on the spot where glasses
rest on the ear. Pain was increasing with the time of use and in some cases (five
persons or 35% of all) it has been intensified into a slight headache.
A user interface showed on the display of the smart glasses was not specially
designed for this specific testing, it was much similar to the one displayed on hand
terminal. User interface in our case is not in the domain of smart glasses producer.
Users were not able to adjust it to their own wishes. The background color, text color,
and font size were pre-configured. 4 (28.6%) of respondents describe the font size
as very suitable, 4 (28.6%) of respondents as suitable with small opportunities for
improvements, 4 (28.6%) of respondents as partially suitable, 1 (7.1%) respondent
as less suitable with large potential for improvements, and 1 (7.1%) respondent as
completely inappropriate.
3 (21.4%) of the participants believe that all the information displayed was nec-
essary for work. Opposite, 1 (7.1%) participant noted that most of the information
was redundant. 7 (50%), of the participants reported that they got more information
that they need but not to many. The average of all responses is 2.79 (SD = 1.188) on
1–5 scale.
On the question to what extent was wearing glasses physically strenuous none of
the respondents answered that it was not physically strenuous. 1 (7.1%) respondent
had the feeling of very small disturbance. 4 (28.6%) experienced moderate distur-
bance. The average of all ratings was 3.8 (SD = 0.89) on 1–5 scale. 3 (21.4%) of
respondents rated wearing glasses as very physically strenuous. If they could, they
would take them off before the task was completed. Respondents reported pain on
the spot where glasses rest on the ear. Other problems include nose pain, burning
sensation in the eyes, headache, pain in the legs and hands. In some cases, glasses
were gliding off the nose and, consequently, there was a need for constant lifting.
5 (35.7%) of respondents always stopped and closed their left eye while reading
information from the display. They never managed to read during the movement.
Described the type of user prevail over those who never closed their left eye while
reading information (14.3%) and are able to walk and read in parallel. The average
rating was 3.43 (SD = 1.5) on the scale from 1 to 5.
Three identifications using a QR code scan were required to move the item in the
storage rack. We assumed the impact of the QR code size on the scanning speed. Users
performed two scans per minute on average or 480 in 4 h. During this time, approxi-
mately, 160 items were moved. 8 (57.1%) of respondents rated QR code scan speed
as fast and 4 (28.6%) as neither fast nor slow. The average rate was 3.42 (SD = 0.9)
on the scale from 1 (very slow) to 5 (very fast). From the respondents’ comments,
it is clear that opinions on QR code scan speed and, in particular, about the causes
for that differ. Some have experienced slower performance at the beginning, which
has improved in parallel with enhancing skills. Several respondents highlighted the
importance of capturing the QR code at an angle that approaches the right one. How-
ever, there is also a belief that difference in the QR code scan speed depends on the
size of the QR codes. Two respondents pointed out that the intervals of quick and
slow QR code scans were cyclic exchanging along the process. Slower performance
was also detected toward the end of the test, probably because the battery on the
smart glasses had already been slightly discharged.
The users of the smart glasses did not notice the emergence of major problems
during the 4-hour work. Based on literature review (Table 2), 11 possible problems
were proposed for rating on the scale from 1 (mildly present) to 5 (strongly present),
namely neck pain, pains in arms, pains in legs, back pain, headache, pressure in eyes,
double vision, blurred vision, dizziness, balance disorder, difficult sharpening text
on the display, and difficultyin walking and reading in parallel. Additionally, they
could also chose 0 (did not appear).
Only blurred vision, difficult sharpening text on the display and difficulty in walk-
ing and reading in parallel slightly stand out (Table 8), observed by around 80% of
users. Due to the small size of the sample, these problems can not be generalized to
a wider population.
Neck pain and pains in legs, noticed by 57% of the respondents, could be correlated
with the highly fixed upper shelve. In particular, people with lower growth had to
stretch their necks upward so that they could position the camera on smart glasses
at an appropriate angle according to the position of the QR code identifying storage
location.
Pains in arms, noticed by 71% of the respondents, could probably not be correlated
with the weight of loads, weighing from a few grams to a maximum of 0.5 kg. The
displaced mass did not exceed 40 kg within 4 h.
For problems like back pain and headache, users did not give any reason or possible
cause.
5 Discussion
Wichaisri and Sopadang (2013) deduced from literature review that sustainable logis-
tics has three perspectives and 15 criteria (Table 1). We used their framework to
describe sustainable use of smart glasses in the case of order picking. Needed data
was provided from literature review and own laboratory experimental work.
Table 8 Problems at 4 h use of smart glasses

Type of 0—Did not 1—Mildly 2 3 4 5—
problem appear present Strongly
present
Neck pain 6 (43%) 4 (28.6%) 1 (7.1%) 1 (7.1%) 1 (7.1%) 1 (7.1%)
Pains in 4 (28.6%) 4 (28.6%) 1 (7.1%) 1 (7.1%) 2 (14.3%) 1 (7.1%)
arms
Pains in 6 (43%) 3 (21.4%) 1 (7.1%) 3 (21.4%) 1 (7.1%) 0
legs
Back pain 4 (28.6%) 3 (21.4%) 2 (14.3%) 3 (21.4%) 2 (14.3%) 0
Headache 8 (57.1%) 4 (28.6%) 0 1 (7.1%) 1 (7.1%) 0
Pressure in 6 (43%) 1 (7.1%) 1 (7.1%) 5 (35.7%) 1 (7.1%) 0
eyes
Double 5 (35.7%) 2 (14.3%) 3 (21.4%) 1 (7.1%) 1 (7.1%) 1 (7.1%)
vision
Blurred 2 (14.3%) 1 (7.1%) 3 (21.4%) 5 (35.7%) 3 (21.4%) 0
vision
Dizziness, 12 (85.8%) 1 (7.1%) 1 (7.1%) 0 0 0
balance
disorder
Difficult 2 (14.3%) 3 (21.4%) 1 (7.1%) 4 (28.6%) 2 (14.3%) 2 (14.3%)
sharpening
text on the
display
Difficult 3 (21.4%) 1 (7.1%) 1 (7.1%) 5 (35.7%) 2 (14.3%) 2 (14.3%)
walking
and reading
in parallel
5.1 Economics Perspective of Sustainability
The first criteria is quality. The output of order picking process is a service. Its quality
is measured by the capacity to accomplish the clients’ orders expressed in the form of
a pick list. To compare the use of smart glasses with other technologies (paper, hand
terminal, voice picking) on quality criteria scientists usually measures the number of
wrongly picked items. Their results are rarely statistically significant, but they often
notice that in their specific case the use of smart glasses can reduce the number of
wrongly picked items, mainly because of the ability to supply the order picker with
information directly at the workplace and track position of the order picker in the
warehouse. However, the contribution depends on a system as a whole and not solely
on smart glasses as a piece of hardware or system widget.
Theoretically, lead time can be shortened due to free hands and reduced need for
walking around to get information. However, shortening lead time is not a logical
consequence when introducing smart glasses. It largely depends on order picking
protocol and the combination with other technologies. In our case the lead time
for order picking by smart glasses was approximately 50% longer than in case of
using paper or hand terminal. The activity that significantly prolonged the process
was scanning QR codes identifying storage locations on the shelves. This activity is
acceptable only if the QR codes are placed at eye level of a straightened person.
Smart glasses are conceptually the ideal tool to achieve the highest demand respon-
siveness if the corresponding software and enabled real-time connectivity permit this.
Smart glasses together with appropriate software can guide the order picker along the
shortest way between the piking sites. By projecting graphical symbols onto display
order picker is routed on micro location or precisely on item itself. The need for
searching locations and items is minimal. Productivity is not a logical consequence
when introducing smart glasses but it can be easily increased if the whole order
picking system is appropriately designed.
5.2 Social Perspective of Sustainability
Social perspective include two criteria, health and safety, and quality of life. Smart
glasses themselves and systems using smart glasses are still developing. Literature
review revealed research gap concerning human health, safety, and comfort during
eight hours workday when using smart glasses. The basic unanswered question is
whether the use of smart glasses could negatively affect the human eye during pro-
longed use. In fact, it is necessary to answer this question for each model separately.
This may prolong the time of entering the new product on the market and even
introduce confusion between customers and users.
The ophthalmologic tests in our laboratory environment revealed some statis-
tically significant differences between results measured before and after 4 h use of
smart glasses for order picking activities. As we reported (Vujica Herzog et al. 2018),
in case of visual acuity, differences between results for left and right eyes are small,
but, for both eyes, the visual acuity is lower after the use of smart glasses. The con-
trast sensitivity and color test did not show any statistically significant differences
between results of tests before and after use of smart glasses. The results of the visual
field test before the use of smart glasses did not reveal scotomas in the right eye’s
inferior quadrant, where the projection of smart glasses was performed. Second test
after use of smart glasses in the same quadrant revealed scotomas in 43% of cases.
This might indicate that use of some models of smart glasses for four hours and more
can cause scotomas and subsequently impairment in the visual field and vision.
The results confirm the need for further research, especially since the existence
of other influence parameters. One of them is the test itself. The perimetry is a
subjective testing, affected mainly by the psychological state of the individuals and
by their willingness to cooperate and concentrate. Second, the tested group was
relatively small.
However, the procedure of using smart glasses can affect beside user vision also
the musculoskeletal system in positive and negative manner. For example, in case of
scanning different identification codes, codes should be placed at the eye level of a
straightened person. In this case, the code lies ideally aligned with the position of the
camera fixed on the frame of the smart glasses, the body of the user is in the neutral
position and there is no risk of injury. Codes placed above the eye level require lifting
the view with stretching the body, bending the neck and lifting to the toes to achieve
the appropriate alignment of the camera according to the code. Long-term strain in
the neck and legs can have a negative effect on the neck vertebrae and the muscles in
the neck and legs. Placing codes to lower locations has a long-term negative impact
on the lower part of the spine. Identification of codes placed below or above the
eye level is also more time consuming. We can conclude that negatively affects the
productivity and the user’s well-being.
64% of users in our test evaluated specific model of smart glasses as physically
disturbing. From their comments, we can summarize some recommendations for the
establishment of a sustainable system, which includes smart glasses. Used model
should ensure a comfortable fit to the user’s head, with the ability to adapt to the
specific anatomy of the individual. The device should not slide on the user’s head
when he/she performs workplace-specific movements. The mass of the device should
be kept to a minimum. Otherwise, pain can occur during long-term use on the spot
where glasses rest on the ears. Long cables and protruding parts should be fixed
to the dress or body to prevent accidents at work and damages on device. Producer
should ensure the ease of disassembly and assembly of the device, exotic and unusual
designs increase the likelihood of damage to device due to the use of force instead
of logic.
64% of users in our test did not have any special problems with the left eye, and
43% of all confirmed this for the right eye. In the case of frequent changing of the
view between real and virtual, a short-term incapacity of focusing on the content on
glasses’ displayed can occasionally occur. Only rare users detected mild pain in the
right eye, slight headache, double vision, blurred vision.
78.6% of users in our test failed to perform the movement simultaneously with
reading the information on the display of smart glasses. Maximum productivity
requires the ability of simultaneous reading and movement. It is very likely that there
is a correlation between the user’s inclination to new technologies and productivity.
The main advantage of using smart glasses is the ability to deliver information
directly to the eyes and ears of the user. The device should allow to the user the
adjustment of the position of the display in desirable position. Device can be damaged
easily and quickly if its design does not allow display’s rotation, shift to the left, right,
up, and down.
The software and design of user interface are just as important for productivity
and well-being as the device itself. Reading the text is more time consuming than
communicating with symbols and colors. Pressing the buttons on the smart glasses
frame is a time consuming and ergonomically inappropriate method of validation.
The fastest way is voice authentication and machine vision. The software solution
should include navigation and graphically supported pointing on the target location.
In traditional systems, the order picker uses about 50% of the time to move between
picking locations, and another 20% for searching. The implementation of informa-
tion management system requires consideration of both human factor and technical
solutions (Wyrwicka et al. 2018).
5.3 Environmental Perspective of Sustainability
Environmental perspective includes five criteria, resource usage, pollution, emission,

waste, and eco-efficiency. In our experiment, this aspect of sustainability was not at
the forefront. The most obvious contribution to sustainability is definitely elimi-
nated need for paper. The use of navigation and route optimization reduces energy
consumption and the need for workforce.
6 Conclusion
The findings of the literature review, results from ophthalmologic tests and conducted
survey motivate us to believe that smart glasses have a place in a sustainable order
picking systems. They can gain on higher productivity, safety, and well-being for
employees, decreased resource usage and other. We have indicated potential contri-
butions to individual sustainability perspectives. Opportunities for further research
work are indisputable. Sustainable characteristics does not depends only on the intro-
duction and use of smart glasses as a piece of device. It is important to carefully com-
bine all the system’s components, including software, user interface, order picking
strategy, storage location labeling, and others.
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60492-3_15
Solutions Dedicated to Internal
Logistics 4.0
Mariusz Kostrzewski, Pavol Varjan and Josef Gnap
Abstract The contribution presents methodological arrangement of internal logis-

tics in the context of Industry 4.0. In addition, it discusses the innovativeness level
of solutions suggested as belonging to the area of internal logistics interests in the
context of Industry 4.0. Numerous concepts related to Industry 4.0 in the area of
internal logistics were treated with attention in the contribution in order to take care
of subjectively identified advantages and disadvantages of all the presented solu-
tions. One of the research questions of this contribution is as follows. The chapter’s
authors attempt to answer the research question to what extent the current consid-
erations regarding Industry 4.0 are applied to date in internal logistics, warehouses,
logistics centres and other facilities of such kind. Some researchers tend to consider
that the observed and announced transformation of industry is not so much a rev-
olution rather than the evolution of existing solutions. Therefore, another research
question is stated in the contribution: is Industry 4.0 truly a revolution? In order to
acquire sufficient information, a considerable significant number of foreign literature
sources and a few Polish, Slovak and German publications were considered. In other
words, desk–research methodology was used for this contribution. In the contribu-
tion, the authors decided to use the qualitative approach, aiming at full resource of
information available in Polish, Slovak and English sources, both scientific (scientific
papers, monographs) and popular ones (in particular, press reports about the so-called
technological novelties applied in facilities of internal logistics and subjected to the
fourth industrial revolution as Industry 4.0 is being called informally).
M. Kostrzewski (B)
Faculty of Transport, Warsaw University of Technology,
Koszykowa 75, 00–662 Warsaw, Poland
P. Varjan · J. Gnap
Faculty of Operation and Economics of Transport and Communications,
Department of Road and Urban Transport, University of Zilina, Univerzitna 1,
010 26 Zilina, Slovakia
J. Gnap

244 M. Kostrzewski et al.
Keywords Industry 4.0 · Internal logistics · Warehouse · Internet of Things ·

Cyber–physical systems
1 Introduction
The first reference to the Industry 4.0 was introduced at the Hannover Fair of Indus-
trial Technologies in 2011, according to Barreto et al. (2017), Bartevyan (2015).
The main purpose of the Industry 4.0 is the emergence of digital manufacturing
which gained its own term of ‘smart’ factory (sometimes recall as Factory 4.0),
which is connected to smart networking, mobility, flexibility of industrial opera-
tions (in logistics, production and other domains) and their interoperability, integra-
tion with customers and suppliers and certainly in adoption of innovative business
models (Nasser 2014). The important feature associated with the so-called fourth
industrial revolution are the intelligent networks based on cyber-physical systems,
Barreto et al. (2017). Cyber-physical systems (CPS) are physical and engineered
systems, whose operations can be monitored, coordinated, controlled and integrated
by a computing and communication system of telematics. Dynamic development
of Industry 4.0 concept is a result of several worldwide social and technological
processes, for example, internationalization, information technology development
and also hyper global competition, according to Grzybowska and Łupicka (2017),
Olesków-Szlapka and Stachowiak (2019). Most of all, it is connected to all variety
of technologies which were developed recently, e.g. Radio-Frequency IDentification
(RFID), Narrow Band IoT (NB-IoT), Wireless Fidelity (Wi-Fi), Near-Field Commu-
nication (NFC), Fifth-Generation mobile networks (5G), Global Positioning System
(GPS), Wireless Sensor Network (WSN), robotics (Liu et al. 2018). No one needs
to be convinced anymore that Industry 4.0 is the future of entrepreneurship. From
the study indicated in Fig. 1, it can be observed that the elements which make up the
idea of Industry 4.0 and Logistics 4.0 are relevant for the next couple of years.
Logistics 4.0 would be considered as strictly connected to the idea of Industry
4.0, meeting its objectives, assumptions and conditions. The aforementioned state-
ment can be confirmed by quoting Jeschke (2015, 2016) who defined Logistics 4.0
as an integral part of Industry 4.0. Jeschke claimed that Logistics 4.0 might refer
to various terms, practices, initiatives, new applications around existing solutions
in broadly understood logistics world. These include terms such as: smart logis-
tics, digitalisation of the supply chain (or any essential part of it), Internet of Things
(IoT) alias physical internet, virtual reality (VR), artificial intelligence (AI), machine
learning (ML), blockchain, autonomous vehicles or simply Industry 4.0. Logistics
4.0 as an integral part of Industry 4.0 is understood as a kind of global trend due to
the broad interest in the subject matter and the increasing frequency of implemen-
tations. It shall apply equally to management aspects of logistics alike engineering
research connected to logistics and transportation matters (Kostrzewski 2017). In
the paper Barreto et al. (2017), its authors indicate in turn that Logistics 4.0 is a
Solutions Dedicated to Internal Logistics 4.0 245
Fig. 1 Trend research. Source Logistics Trend Radar (2016), redesigned and rewritten
after http://www.dhl.com/content/dam/Local_Images/g0/New_aboutus/logistics_insights/header_
720x180/trend_2016_2_full.jpg. Accessed 11 Dec 2018
combination of using logistics with the innovations and applications added by cyber-
physical systems (CPS). According to mentioned authors Logistics 4.0 is related
to the same conditions as smart services and smart products. Therefore it can be
stated, they defined term of smart logistics which might be treated as synonym
to Logistics 4.0. Smart products and services are the ones that can execute activ-
ities in logistics processes, that normally are realized by employees, in order to
employees’ concentration on processes that are more sophisticated, more focused
on intelligence than automatic and repetitive processes (authors of the paper
Grzybowska and Łupicka 2019 researched the key competencies of managers in
that kind of purposes). The authors of Barreto et al. (2017) stated that Logistics
4.0 rely on the following compounds: resource planning, warehouse management
systems, transportation management systems, intelligent transportation systems and
information security. The authors of this paper could add systems of telematics as
well. Nonetheless, these are not key aspects since such systems and application are
broadly used currently. Logistics 4.0 is more connected to correspondence between
the mentioned compounds with less direct human involvement in the processes, it is
‘evolvement of the cyber technologies and their integration into digital ecosystems
of all industry value chain’ (Barreto et al. 2017), as Industry 4.0 is sometimes under-
stood. This correspondence is realized with use of so-called agents which include:
sensors, actuators, control processing units, and communication devices.
At the current stage of implementation of Industry 4.0 solutions, it is not possible

to clearly identify and estimate the scale of benefits and risks, which may occur
as a result of the application of technologies focused around this concept. In the
paper Götz and Gracel (2017), authors mentioned endangered due to the inability
to maintain the pace of transformation of domestic entities—unsuccessful catching
up in the area of Industry 4.0. Another author adheres to threats to data security,
privacy or even the problem of industrial espionage (Godlewski 2016). Another
authors’ concern is the loss of jobs. According to OECD studies, due to automation
in Germany—the homeland of Industry 4.0—about 12% of jobs are threatened, and
in the case of Poland, this quantity is circa about 7% (Brandt 2016). Such levels
of threatened jobs are considered to be positions where 70% of the work can be
replaced by machines. In the United Kingdom this rate reaches 10%, in the USA—
9% and in Japan—7%, (Götz and Gracel 2017). The industrial revolution would
certainly change the structure of employment in the labour market, and although
some studies even speak of the disappearance of more than 200 occupations, new
ones will certainly emerge (Both 2015). On the other hand, in the last 60 years,
automation has only eliminated one occupation: elevator operator (Mahdawi 2017)
and a lot of currently major operations in logistics are still made manually, with no
automated techniques (Guide and van Wassenhove 2001; Kosacka 2018).
The authors of the chapter, referring to this concept of Logistics 4.0, wish to present
several implementations and solutions equipped and enriched with the mentioned
agents. Based on the analysis of described implementations and solutions, an attempt
was made to obtain answers to two research questions. These are as follows:
• RQ1: What is the innovativeness level of solutions suggested as belonging to
Logistics 4.0 in the context of Industry 4.0?
• RQ2: Is Industry 4.0 truly a revolution?
In the first section of this chapter the research methodology is described. In the next
sections research questions are analysed and attempt to obtain answers is undertaken.
In the case of first research question RQ1, in the proper section, the following groups
of solutions are discussed: autonomous mobile robots, automatic guided vehicles
and civil drones in autonomous warehouses. In the penultimate section, the answer
to research question RQ2 is analysed. And at the last section of the chapter, some
conclusions can be found.
2 Methodology
This chapter analyses solutions connected to internal logistics, therefore it is mainly

connected to autonomous warehouses, especially that with world economic global-
ization, warehouses have become increasingly essential (Zaj˛ac 2015). It is an impor-
tant topic in the era of Industry 4.0 and Logistics 4.0 as far as it is strongly connected to
the mentioned pair of terms. Meanwhile, analysis of Science Direct database sources
on April 2018, from the view point of term ‘autonomous warehouse’ has shown a
remarkable rarity in taking up this topic. Only two papers were found: Vasiljević et al.
(2016), Rascon and Meza (2017). In the month of this chapter’s writing one more
paper occurred: Subrin et al. (2018). In order to acquire sufficient information, a con-
siderable significant number of foreign literature sources and a few Polish, Slovak
and German publications were considered in this chapter. Desk–research methodol-
ogy was used for this contribution. In the contribution, the authors decided to use
the qualitative approach, aiming at full resource of information available in Polish,
Slovak, German and most of all English sources, both scientific and popular ones (in
particular websites, press reports about the so-called technological novelties applied
in facilities of internal logistics and subjected to the Fourth Industrial Revolution as
Industry 4.0 is being called informally). The research strives to develop evaluation
methodology to assess whether the current status of a subject matter corresponds in
any way with Logistics 4.0 and Industry 4.0 assumptions.
In the case of the first research question, primarily solutions were divided into
fields of interest and their components were discussed (chosen technical aspects,
processes they perform, information systems they benefit from and management
approach they use). And then the innovativeness of solutions based on the proposed
simple mathematical structure of formula was assessed. It can be said that insights
on the future directions towards building smart warehouses were given.
In the case of second research questions, pros and cons are given for and against
the statement that Industry 4.0 is a kind of revolution. All of them are referenced to
proper literature sources and chapter’s authors opinions.
3 Innovativeness Level of Solutions Suggested as Belonging

to Logistics 4.0 in the Context of Industry 4.0
First of all, it should be mentioned that innovativeness level is understood here as

ratio between the number of solutions released after Hannover Fair of Industrial
Technologies event, that are considered as innovative, and the total number of post-
trade fair solutions presented in this chapter. This ratio is expressed as a percentage
and is a subjective value determined as a result of the application of the expert
method. The innovativeness level is presented at the end of this section. Meanwhile,
innovativeness per se is understood as a tendency to innovate, or introduce something
new or different, characterized by innovation (Harper 2010).
In the paper (Götz and Gracel 2017) certain groups of main application exam-
ples of the Fourth Industrial Revolution were mentioned. These are as follows:
autonomous vehicles (e.g. cars, drones), advanced robots (working together with
people in factories, caring for the elderly, cleaning), 3D printing and the use of new
materials, e.g. self-cleaning fabrics, ceramics exchanging pressure into energy, or
graphene. It is worth taking a look at the currently proposed solutions’ application
in internal logistics, some of which also belong to the abovementioned groups.
Most companies are not ready to apply Logistics 4.0 concepts and technologies.
However, in some industries, progress, development and rapid deployment of appli-
cations cannot be avoided in order to stay competitive. This mostly pertains to the
automotive industry and electronics ones. Certainly, those two can be considered
as leading industries in Logistics 4.0 implementation (this might be concluded
from paper Nagy et al. 2018). Automatic supply of parts to assembly lines using
autonomous guided vehicles and robotic workstations, and fully automatic welding
lines can be observed today for example in Volkswagen Slovakia Bratislava or Škoda
Czech Republic Prague. These and other kinds of solutions connected to Logistics
4.0 are discussed below.
3.1 Autonomous Mobile Robots (AMR) and Similar Solutions
One of wide spectrum of autonomous mobile robots (AMR) designed for different
tasks in logistics processes is the example of Vecna robots. They produce robots
which are specialized in order-picking processes, putting or picking of a case, pallet
moves, and tuggers for a warehouse areas, Banker (2018). According to Banker
(2018), for example Amazon’s Kiva robots are designed to be operated in a section
of a warehouse off-limits to humans, in the restricted area of automatic warehouse.
On the contrary, Vecna’s robots have vision systems that allow them to navigate
safely around humans and share common transit paths by application of machine
learning technologies (these robots are apt to discover things, and their reactions are
not predefined—in case of a situation when a robot does not know how to react, it can
call human for help). They also correspond and collaborate with each other which
is one of the assumptions of Industry 4.0 (machine-to-machine communication). As
example, part of order-picking process may be given—picking robot might place a
case on an automated guided vehicle style robot that would then transport a case to
a pallet build station.
The term of automated guided vehicle was in use before application of different
sensors to such a vehicle which might assure new perspective of using this kind
of vehicle. Nowadays, these are autonomous automated guided vehicle (AAGV;
other authors call them as mobile robot fulfilment systems—MRFS, Boysen et al.
2018; according to Azadeh et al. (2018), Boysen et al. (2018), and Jünemann (1989)
was the first author who conceptualized MRFS). Automated Guided Vehicle System
(AGVS), which elements are Automated Guided Vehicles (AGVs) was used as a
material handling system for several decades (Bocewicz and Banaszak 2013) from
1950s (Wurman et al. 2008), however from several years this system may be used in
more efficient way. AGVS is a computer-controlled material handling system which
parts are AGVs—driverless vehicles that are controlled with microprocessors and
which can automatically perform loading, route selection and unloading (Awasthi
et al. 2009; Vishwanadham and Narhari 1992). Nowadays, AGVs become more inde-
pendent than before, especially that they become cheaper, smaller, and more capable
because of using inexpensive wireless communications, computational power, and
robotic components (Wurman et al. 2008).
Some researchers mentioned that this is a new group of vehicles which acronym
is AAGV as autonomous automated guided vehicles which are characterized by the
fact of using integrated ceiling-mounted camera for tracking and dynamic control
purposes (Culler and Long 2016). This camera works in order to detect the presence
of a vehicle robot in a warehouse, track its movement, and identify pathways and
obstacles on a floor. Special controllers, sensors and devices were added to the basic
robot platforms (vehicles) in order to their adaptation to different situations by receiv-
ing commands from a main computer and for interacting with their surroundings.
This solution was prototyped before 2016 (Culler and Long 2016). In more general,
it can be said that these are solutions under the term multivehicle system (MVS) to
refer to multi-agent systems with autonomous, robotic vehicles, where multi-agent
system (MAS) refers to the general class of systems in which autonomous agents
carry out actions and communicate with each other through procedures and sensors
(Wurman et al. 2008).
Kiva robots, mentioned a couple of paragraphs before, started this revolution of
autonomous AGV with its first implementation in 2006 (Wurman et al. 2008)—by
the way, the patent is mentioned for 2008 (Mountz et al. 2008; Boysen et al. 2018).
The Kiva system consists of small storage shelves structures (inventory pods) which
are lifted and transported by small autonomous mobile robots (AMR)—drive units.
These shelves, with products on them, can be transported to any predefined area
of a warehouse including employees, work area where employee can pick items
off inventory pod and put them into shipping load unit. Such a process increases
productivity twice or even more and in the same time improves accountability and
flexibility (Wurman et al. 2008). Kiva robots are not depended on each other, however
all the system is designed in such a way to accomplish a certain task connected to
customer’s order. This system is highly influenced by artificial intelligence techniques
(Wurman et al. 2008). In 2012, Amazon fulfilled its centre in California with more
than 3000 AGVs/AMRs of Kiva to redistribute goods for delivery—as the effect the
productivity was reported to increase by 20% (CNET 2018).
Similarly to Vecna’s and Kiva robots mentioned several paragraphs before, also
CEIT robots allow to navigate safely around humans.
Central European Institute of Technology (CEIT) specializes in automation for
internal logistics. The company has implemented its own smart logistics system to
Volkswagen Slovakia—largest automotive company in Slovakia and also into Škoda
in the Czech Republic. The system uses CEIT smart mobile robots (with artificial
intelligence implementation, Hercko and Botka 2017). These robots transfer material
to production lines. The material can be individually loaded and unloaded exactly
in time and in the right place. This kind of robots respond flexibly to the current
production situation. At the same time, they collect a huge amount of data about the
flow and development of internal logistics processes. The data are monitored and
evaluated in online mode. Based on the collected data, a virtual real-world logistics
mirror of a logistics facility is implemented and thanks to such simulation tool all of
internal logistics processes can be managed, analysed, evaluated and optimized.
The solution were appreciated as a successful connection of automatic vehicles

(AGV) and extended reality and was awarded during Automotive Logistics Europe
in 2018 (CEIT Group 2018). This device was released in 2007 (CEIT 2007).
The innovative solution offers great potential for various types of optimization
as well as verifiable improvements for a customer. In case of Volkswagen Slovakia,
CEIT has also developed Overall Equipment Effectiveness (OEE). OEE is a com-
prehensive production benchmark designed to assess the effectiveness of produc-
tion. This indicator can be implemented in AGV MCS (AGV Monitor and Control
System). Using OEE tool, enriched with different types of sensors unique data on
logistics and system’s productivity are collected and visualized in online mode. The
result of the analysis is all-in indicator (calculation and display). It ensures overall
efficiency of a robotic device.
These and other elements of smart logistics can be found in other companies as
well. In most cases, they represent suppliers for the automotive segment.
The basic of the autonomous solutions of the CEIT is the connection of automated
guided vehicles equipped with co-working robot installed on AGV (cobot). The
modular connection provides the option of picking goods from shelves in a warehouse
in fully automatic mode (Hercko and Botka 2017).
The whole system with robots and automated guided vehicles (AGV) is called as
CEIT line feeding system (Automatic Guided Vehicles are a class of autonomous
mobile robots according to Culler and Long (2016). Currently, it consists of two
AGV types—‘run under’ version and ‘towing’ version. Some characteristics of these
solutions are as follows: speed of vehicle is up to 2 m/s, weight capacity (tensile
strength) is up to 3000 kg, they are equipped in brake energy regeneration, automatic
localization and positioning, wireless monitoring and control system, safety scanners
and automatic charging during exploitation (Hercko and Botka 2017; Gregor et al.
2009). This solution is conducted via cloud, whereas the cloud-based solution is also
accessing information from other factory data sources, such as production planning
and control systems, external logistics.
Run under AGV device can be used as a movable mounting table and may be used
in particular for the transport of parts which are sensitive to handling, respectively,
during manipulation threaten to damage. On the contrary, towing AGV might be more
productive since this device is able to take more load/products at once. This system
is equipped with tough ‘c-frame’ movable pallets, which are used as wagons. This
feature is supported with automatic system of connecting and disconnecting wagons
by automatic system, therefore this solution works as AVG milk–run (Hercko and
Botka 2017). During a transport process a set of c-frame pallets is pulled by a guiding
vehicle (automated logistics tractor). Tractors are moving along predefined routes
delineated by magnetic tape fixed to floor in an aisle.
Solution connected to AAGV or MRFS might be used also as connecting a quay
with the container storages in sea terminals since AGVs do it already (Schönemann
and Plattner 2012).
3.2 Civil Drones in Autonomous Warehouses
Robots that are mentioned in the previous section have one main limitation. They
are restricted to be used in the case of ground (one level) motion. Therefore, it is
worth mentioning about solution which allows to realize some logistics processes in
multiple dimensions. One of proposal providing a solution to this issue is usage of
drones.
Civil drones started to be used in warehouses. Two companies (Geodis and Delta
Drone) in cooperation developed fully automatic drone warehouse inventory solu-
tion. According to Whittaker (2018), it combines a robot on the ground, with a
battery that provides the energy needed to navigate a drone (in the same time assur-
ing overcome the constraints of autonomy), and a quadcopter drone equipped with
four high-definition cameras (Geodes 2018). The set, equipped with indoor geoloca-
tion technology, might work in total autonomy inside a warehouse. There are several
reasons this solution might arouse interest of warehouse managers in the nearest
future. One of them is the fact that productivity of a warehouse enriched with such
drones may generate certain logistics processes also beyond hours of activities of
a warehouse (which means a warehouse may work even without human supervision).
Drones can monitor autonomous warehouses especially in its areas where employ-
ees are not allowed to enter (e.g. in the restricted area of automatic warehouses)
for reasons of potential danger to health and life. By the way, there are research
human comfortable and safety in an environment with heavy mobile robots passing
in vicinity, for example, in these kinds of restricted warehouse areas, in order to make
some repairs and inspections of robots involved to work in such an environment. The
authors of Puljiz et al. (2018) proposed using live cameras feed and communica-
tion options enabled by augmented reality devices for quick interventions or even
preventions which could be made by the workers inside of mentioned warehouses
with support of remote specialists (navigate and support human workers in such
automated environments). This project is under simulation mode.
Initiators of this technology claim that it might be easily transferred from one
warehouse to another without any prior modification of warehouse regular processes
(Whittaker 2018). They also claim that this solution might be adapted to either
warehouse management system (WMS). They have tested this solution under real
conditions in order to respond to certain specific constraints of warehouses. Whereby,
it seems to be not complicated since a typical warehouse consist of many similar
semi-structures (the infrastructure is more or less similar in every logistics facilities
of such kind).
Industrial production of such a technology has been announced at the end of 2018,
Whittaker (2018).
This kind of research are conducted also by other implementations’ makers, e.g.
in Deepak (2015). A drone in this system navigates inside a warehouse using an
image that it obtains from the primary camera, it has and similarly to the previous
solution, it does not depend on any of the fixed markers. This solution consists of
four subsystems: map creation for navigation, autonomous flying based on object
detection, creating steering commands, performing inventory (Deepak 2015).
Inspections of a warehouse might be also realized by Micro-air Vehicle (MAV)

with no prior knowledge of the environment which is described in the report on
field tests of autonomous inspection in an industrial indoor facility. Nevertheless,
this is not a device which would take part in the logistics processes of operation
independently (Eudes et al. 2018).
3.3 Management Assistantship
Solutions connected to Logistics 4.0 are also connected to office work–balance man-
agement. Digital HR Assistant, called also as Chatbot, is a kind of independent
employees’ self-service platform which might be fully integrated with company’s
employees’ systems in order to arrange paid or unpaid time off, cancel or post-
pone meetings and automatically inform colleagues or customers aforementioned
(Lockett 2018). Therefore not only warehouse or production employees could con-
centrate on processes that are more sophisticated, more focused on intelligence than
automatic and repetitive processes—also managers could be released from routine
tasks and free to concentrate on value-adding aspects of their work. According to
Lawler and Boudreau (2015), Lockett (2018), HR managers—as in the 90s of previ-
ous century—spend 25% of their time on record keeping and auditing employment
practices and 50% on providing and developing HR programmes and services.
In addition to the growth of data that will be generated by different machines
and devices, the least important step on the way to Logistics 4.0 is Electronic Data
Interchange between subscriber and supplier (EDI). EDI is computer-to-computer
exchange of business documents in a standard electronic format between business
partners (Narayanan et al. 2009). Some companies often mistakenly believe that EDI
also involves writing emails and sending orders via e-mail. According to the data
of the Czech Statistical Office, only 10% of small businesses, 15% of small and
medium-sized enterprises and about 30% of large enterprises are currently using
EDI to exchange data with their suppliers, Sidora (2017).
3.4 More Solutions
Different other solutions are also connected to internal logistics and at the same
time meet the assumptions and objectives on Industry 4.0. Several of them are worth
mentioning:
• Butlers—pallet delivery robots that handles palette load units of up to 1600 kg
and has been designed to deal with bulk inventory in factory warehouses,
omnichannel fulfilment centres and large distribution hubs (Post & Parcel 2018),
• CarryPick KMP600 AGV robots (since 2012, Boysen et al. 2018) similar to men-
tioned Kiva robots and as well as Kiva also based on AGV idea (Swisslog 2018),
• BinGo—novel transportation concept (Kerner 2016),

• Multiple Autonomous forklifts for Loading and Transportation Applications
(MALTA)—a modified forklift truck with an AGV controller and a reflector-based
localization laser for guidance purposes. Two front lasers are used for real detec-
tion and safe navigation. The 1000 autonomous forklifts of such kind are tested at
the testing facility in Schio (Astrand et al. 2009; Malta Project 2018),
• e-Palette—autonomous movable distribution warehouse designed by Toyota
(Banks 2018)—authors of the paper (Grzybowska and Kostrzewski 2016) real-
ized research on movable distribute warehouses,
• KUKA mobile platform (KMP) 1500 (KUKA 2017),
• Other.
3.5 Solutions Assessment
This section presents the proposal of the tool for assessing the innovativeness of
the discussed solutions in relation to Industry 4.0. Industry 4.0 was introduced at
the Hannover Fair of Industrial Technologies in 2011, according to Barreto et al.
(2017), Bartevyan (2015). And this date is useful in the proposed formula (tool by
Kostrzewski).
At the first stage of assessment, the following datasets should be given:
• A—a set of presented solutions, A = {1, . . . , a, . . . , A},
• S—a binary set explained by its elements, S = {0, 1}, s = 0 if the solution in
question existed before 2011, s = 1 if the solution in question existed after 2011.
The Cartesian product shall then be designated as in Formula (1), the elements of
which are transferred to set I as it is given in Formulas (2) and (3).
A× S → I (1)
I = {i(1, 0), i(1, 1), . . . , i(a, s), . . . i(A, S)} (2)

0 : ∃s = 0
i(a, s) = (3)
1 : ∃s = 1
In the next stage, the parameter i should be computed (4). This parameter quan-
tifies solutions which determines the number of solutions that can be considered as
potentially innovative.

i= i(a, s) (4)
a∈ A s∈S
Table 1 Application of Kostrzewski’s formula

Device/solution Year of release a s i(a, s)
Vecna 2017 1 1 1
Kiva 2006/2008 2 0 0
CEIT 2007 3 0 0
Geodis and Delta Drone 2018 4 1 1
Micro-air vehicle 2018 5 1 1
Digital HR assistant 2018 6 1 1
EDI XX century 7 0 0
Butlers 2018 8 1 1
CarryPick KMP600 2012 9 1 1
BinGo 2016 10 1 1
Multiple autonomous forklifts for 2009 11 0 0
loading and transportation
applications
e-Palette 2018 12 1 1
KUKA mobile platform (KMP) 2017 13 1 1
1500
The prerequisite for innovative solutions are as follows:

• ∃ car d(
i
A)
≤ 0.50—solutions from set A (taken together) are not considered to be
innovative,
• ∃ car d(
i
A)
> 0.50—solutions from set A (taken together) can be considered as
innovative,
where: car d( A)—cardinality of a set A.
Table 1 presents the application of presented formula. It can be stayed that almost
70% of presented devices/solutions were released after the Hannover Fair of Indus-
trial Technologies which took place in 2011. This might mean that the idea of Industry
4.0 significantly contributes to the innovation of products in the sphere of Logistics
4.0. With regard to RQ1, it can be said that the innovativeness level of solutions
suggested as belonging to Logistics 4.0 in the context of Industry 4.0 is circa about
70%, therefore it is highly satisfactory. The described solutions might be considered
as best practices in logistics (Chaberek and Mańkowski 2017).
4 Is Industry 4.0 Truly a Revolution?
A lot of authors defined Industry 4.0. On the one hand, it is understood as a collective
term for technologies and concepts of value chain organization (Hermann et al. 2016).
On the other hand, it is comprehended as a complex solution created at the junction of
engineering, computer science and management knowledge (Götz and Gracel 2017).
The buzz word is that it is another ‘revolution’. Taking into account the fact that many
of the solutions driving the fourth revolution are already working (cloud computing,
Big Data), some researchers tend to believe that the observed and announced trans-
formation is not so much a revolution rather than an evolution of existing solutions
(Götz and Gracel 2017; Maślanek 2014; Alcácer et al. 2016). The authors of this
paper are also inclined to define Industry 4.0 as the issues focused on the progress of
the mentioned areas of evolutionary character. In the paper of Götz and Gracel (2017),
referring to Schwab (2016), the authors highlighted the differences between the third
and fourth industrial revolutions: global access to the Internet, dramatic reduction in
data storage costs, mobility of devices, intelligent sensors, renewable energy sources
and artificial intelligence (including machine learning). Further concepts have been
traced in order to verify the thesis that Industry 4.0 is revolutionary or evolutionary
in fact and whether it is a new conception or not. Industry 4.0 is connected to the
disappearance of the barrier between human and machines or devices. The beginning
of its era is considered to be at the beginning of the current decade. The term Industry
4.0 comes from the German government’s high-tech strategy which is promoted in
order to the computerization of manufacturing processes and it was recalled for the
first time at the Hanover trade fair in 2011 (Kagermann et al. 2011). With regard to
this date, the mentioned differences between the third and fourth industrial revolution
will be traced and on this basis an attempt will be made in order to answer RQ2.
Differential factors will now be traced in this section of the paper.
As the first one, worldwide access to the Internet is analysed. It has undoubtedly
been growing over the last decades, albeit not evenly distributed across the globe.
According to Internet World Stats (2018) only 55.1% of worldwide population have
access to the internet. And this percentage value is average for worldwide human
population. It is least for African countries amounting to 36.1%, and the most abun-
dant in case of North America’s countries: 95% (Internet World Stats 2018). In view
of the presented data (see also Fig. 2), it is quite risky to state the Internet access is
common and widespread.
As the second one difference between the Third and Fourth Industrial Revolutions
drastically reduction of storage data costs was mentioned. As indicated in the research
in (Götz and Gracel 2017), storing 1 GB of data in 1995 cost about 10 000 USD/year,
meanwhile in 2016, this cost was equal to 3 cents. And in 2017, cost of 1 GB data
storing was equal 2 cents (Mearian 2017). Data storage technology has transformed
completely since the initial models of magnetic tape from the 1920s (Kimizuka 2012)
to currently used cloud computing. It is undeniably true that there has been drastically
reduction of data storage costs, however, quantity of stored data increased even more
drastically. Therefore, relative cost of storage would be considered as much bigger.
Another difference between the Third and Fourth Industrial Revolutions is mobil-
ity of devices. Let us assume that we will limit ourselves here to considering the issue
of smartphones. The historically first smartphone was created in 1992, designed and
developed by International Business Machines Corporation (Woyke 2014). It was a
prototype device called Simon with a touch screen and Personal Digital Assistant
(PDA), therefore it was considered as combining the functions of a mobile phone
Fig. 2 Internet World penetration rates by geographical regions for June 30, 2018. Source Own
elaboration based on Internet World Stats (2018)
and a portable computer (PDA). And thus, it was much before Hanover trade fair
and many other smart devices were based on smartphone conception.
This was also the case with intelligent sensors (including those responsive to
the presence of people in the vicinity) which are believed as one more difference
between the third and fourth industrial revolutions. Intelligent or rather smart sensors
was probably created in the middle of the 70s of previous century (Corsi 2014). It
is difficult to give an unambiguous date since smart sensors technology was kept
restricted within a close military environment. This technology started to be used in
the world of civilians in applications and performances in the 90s of previous century
(Corsi 2014). Smart sensors, however, use Internet of Things, the term of which is
also much older than idea of Industry 4.0. The term Internet of Things is 18 years
old. But the actual idea of connected devices had been around longer, at least since
the 70s of the previous century. Back then, the idea was often called ‘embedded
internet’ or ‘pervasive computing’. But the actual term ‘Internet of Things’ was
coined by Kevin Ashton in 1999 during his work on promoting RFID technology
(Lueth 2014). Despite of such a long existence of the concept, the popularity of the
term Internet of Things accelerated at the turn of years 2010 and 2011 and reached
mass market in early 2014 (Lueth 2014). Both these dates are important for Industry
4.0 as the first is when the term Industry 4.0 was used for the first time and around
2014 probably Jeschke started to define and use the term Logistics 4.0 for the first
time. Certainly, the definitions of Internet of Things varies and changes. Herein,
it is understood as ‘sensors and actuators embedded in physical objects are linked
through wired and wireless networks, often using the same Internet Protocol (IP)
that connects the Internet’ (Das et al. 2018 after Uckelmann et al. 2011). Application
of Internet of Things in industry and logistics became much easier task with 26.16
billion connected devices expected to be in use worldwide in 2019, up to 75.44 in
2025, thus prognoses with polynomial trend (Fig. 3), Statista (2018).
Fig. 3 Expected quantities of devices used in the world, in billions. Source Own elaboration based
on Statista (2018)
It would now be appropriate to respond to RQ2. As a result of the above statements,

it can be concluded, on the one hand, that the Industry 4.0 concept consists of a
conglomerate of concepts and applications used much earlier. On the other hand, it
can be concluded that Industry 4.0 is a complicated net of dependencies, therefore
it is not obvious whether it is innovative conception. However, it changes rather in
evolutionary than revolutionary way. As if it were not, the idea is noteworthy because
while it continues to evolve, the four key pillars within Industry 4.0 that impact the
supply chain are smart factories, Internet of Things, advanced analytics and more
knowledgeable workers.
5 Summary
Due to the demographic development, it is not possible to cope with the growth
associated with the development and shopping via the internet. Smart technology
and robots with the ability to learn can improve efficiency. In economically advanced
countries, they can help with a lack of workforce in logistics. However, this is a
long-term process. Developments to a high degree of warehouse automation can
be expected over a 10–20-year horizon. Applying a high degree of automation is
most likely due to a reasonable return on investment. The availability of automation
solutions is important not only for newly built but also for already built warehouses
(Polák 2018).
From the financial point of present view, collaborative robots and other solutions
connected to Logistics 4.0 appear to be the optimal solution for logistics processes.
Collaborating robots (cobots) are complemented by artificial intelligence. These are
able to learn directly from warehouse employees without the need for a lengthy and
costly software change (it is human–robot collaboration). Their properties are close
to humans. They perceive their surroundings, move and accurately carry out their
actions with people. This should not endanger work safety.
At selected distribution centres and warehouses, rotary robots have been tested for
pilot projects for several years. In case of robots increasing of workflow efficiency
is the fact that instead of five employees, only two employees and one robot could
do the same work (Polák 2018). What is more, unmanned carriage in a warehouse
would follow a worker. This way of ordering items is more efficient and ergonomic.
Similar benefits are expected from the rapid scanning of the size and weight of ship-
ments that allow optimization and automation of loading and unloading of shipments.
Warehouses with the use of autonomous means of transport and equipment require
an efficient operation. It would be risky to check and test processes taking place in
real facilities of such kind due to potentially high costs of the used technologies,
therefore it is advisable to use modelling with the use of simulation methods. Just as
in the case of CEIT robots, it was mentioned that based on the collected data a virtual
real-world logistics mirror of a logistics facility might be implemented in order to use
it as simulation field test. What-if simulation analysis could help to research on the
innovativeness level of certain solutions suggested as belonging to Logistics 4.0 in
the context of Industry 4.0 in any company. In proportion, on the basis of the data set
out in the chapter it can be stated that mentioned innovativeness level is circa about
70%, therefore it is highly satisfactory. And in general, all the aspects of Industry
4.0 change rather in evolutionary than revolutionary way.
It is obvious that the development of Industry 4.0 based on digitization and automa-
tion represents for Logistics 4.0 not only huge challenges but also opportunities for
increasing efficiency, no matter whether it is revolution or evolution. It is also worth
mentioning that the similarity of logistics and production processes blur the differ-
ences between Logistics 4.0 and Factory 4.0 and consequently also Industry 4.0.
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Manager’s Maturity as a Derivative
of Competencies and Dynamic
Capabilities—Vivisection in the Context
of Industry 4.0
Przemysław Niewiadomski, Natalia Pawlak and Anabela Carvalho Alves
Abstract The role and importance of management staff is very important in the
era of the Fourth Industrial Revolution. A high-quality production environment will
require mature management staff with experience in working with new technologies,
machines, and, especially, data and information. The undertaken research indicates
that both in terms of theory and practice of management, there are many unresolved
issues concerning the measurement of maturity of a manager. Given the above, it
was recognized as justified in this chapter to contrive and implement an assessment
method in practice. The fundamental purpose of the chapter is attempted assessment
of maturity of managers in manufacturing companies operating in the agricultural
machinery sector being an answer to the upcoming Fourth Industrial Revolution
identified as a concept regarding the use of automation and processing and exchange
of data as well as implementation of various new technologies enabling to create the
so-called cyber-physical systems and change of the methods of manufacturing.
Keywords Manager’s maturity · Industry 4.0 · Dynamic competences ·

Cyber-physical systems · Management staff
1 Introduction
The extensive approach to organization, functioning at the beginning of the twen-

tieth century, has been strongly devalued in the recent few dozen years. Routine
behaviours and consolidation of rigid, hierarchical action structures are more and
more often rejected, and simply undesirable. The innovative model becomes a
standard in the development of contemporary businesses, consisting of delivery of
P. Niewiadomski (B)
Uniwersytet Zielonogórski, Podgórna 9, 65-246 Zielona Góra, Poland
N. Pawlak
A. C. Alves
School of Engineering, University of Minho, 4800-058 Guimarães, Portugal

264 P. Niewiadomski et al.
an increasingly more attractive offer to the market using qualitative development

factors. A necessary and basic factor in increasing the innovation of Polish enter-
prises and, in consequence, their competitiveness based on high value-added products
and services, is a human who is able to create innovative solutions. Therefore, it is
necessary to take action focused on the formation of innovators, without whom the
transition to the stage of innovation-based economic growth will be difficult.
In connection with the above, it should be emphasized that dynamic economic
growth related to future macro trends will require human capital quality growth.
The Fourth Industrial Revolution, involving a deep, digital industry transformation
will be one of the most important technological macro trends in the coming years.
The properly prepared management staff, mainly using knowledge, applying, in their
work, new techniques of obtaining information and processing data, are the necessary
precondition for the assumed ‘civilizational leap’. The demand for management
capabilities, skills, and competencies will be determined by trends emerging on
European and world markets, which are also present in the Polish market.
It is, therefore, necessary to take actions focused on strengthening competencies
necessary for the development of innovation in enterprises. Apart from resources
needed to create and develop innovation such as good ideas, breakthrough inventions,
cash capital and a team of outstanding specialists also a well prepared and mindful
manager is necessary. In the first place, he or she is able to stimulate, see, assess and
sell innovative ideas and solutions adapted to consumer needs.
Therefore, particular attention will be focused on the competencies of managers,
who help form the innovative culture and manage the whole innovative cycle. Due
to the empirical evidence proving the presence of a strong connection between a
well-managed innovative process and the company’s market success, improvement
in innovation management skills by dedicated management programs should signif-
icantly contribute to the development of innovative businesses.
The prevailing dynamic changes will require the development of new competen-
cies and capabilities related to the use of technologies such as cyber-physical systems,
advanced production management systems, advanced robotization, complex produc-
tion data analysis systems, and artificial intelligence. The need to operate databases
and to have algorithmic thinking skills, allowing new programming languages to be
learned fast, will become common. The most important competencies, both general
and specialist ones, will include: data assessment and analysis, data safety, data doc-
umentation and reading skill, work in a cloud, ability to take relevant decisions in the
IT environment, programming, software development, artificial intelligence algo-
rithms, software cooperation, 3D print, digital tool-based applications, user-focused
IT design and IT diagnostics.
Numerous attempts to distinguish competencies from capabilities include those
that point to the superiority of competencies over capabilities. In the chapter, com-
petencies have been separated from capabilities, with the clear differences present
between them being emphasized. Competencies are considered in comparison to the
achieved results, on the other hand, capabilities are identified with possibilities or
Manager’s Maturity as a Derivative of Competencies … 265
skills. In addition, the authors question the fact, whether the identification of compe-
tencies with capabilities is adequate for an organization operating in the present busi-
ness reality, an organization that looks to the future, gains new knowledge, arouses
intellectual curiosity and encourages discussion.
The following direction aggregates competencies and capabilities focused on the
maturity of managers. As a result, the decision was made to focus the research on
operations related to the key challenges for the development of managerial capital
from the point of view of productivity growth and quality of their work.
Given the above, it has been deemed justified in this chapter to contrive and imple-
ment an assessment method of maturity of managers in practice. The fundamental
purpose of the chapter is attempted assessment of maturity of managers in manu-
facturing companies operating in the agricultural machinery sector being an answer
to the upcoming Fourth Industrial Revolution identified as a concept regarding the
use of automation and processing and exchange of data as well as implementation of
various new technologies allowing creation of the so-called cyber-physical systems
and change of the methods of manufacturing (Lee et al. 2015; Kagermann 2014). In
order to limit the amount of text maturity of a manager aspiring to function in the era
of Industry 4.0 will be shortly referred to in the chapter as Industry 4.0 manager’s
maturity or manager 4.0’s maturity.
In connection with the so outlined aim, the following have been recommended as
necessary actions:
– in the theoretical perspective—by reconstructing and interpreting Polish and for-
eign subject matter literature, supported by experts’ knowledge, nominate the
definition of a manager’s maturity—as adequate to the research;
– in the project perspective—compile a research tool in the form of an assessment
sheet being a result of the literature study and a discussion among intentionally
selected experts; recommend questions assessing the level of maturity of a manager
aspiring to function in the era of Industry 4.0;
– in the empirical perspective—practical use of the method; maturity assessment of
managers operating in the agricultural machinery sector.
It seems that the complexity of the problems and the so far limited scientific
recognition justify the treatment of the mentioned matters as the subject matter of
the research. Additional confirmation for the need to undertake research also results
from the following facts:
– on the editorial market there is an absence of studies concerning the assessment
of the maturity of managers, especially in terms of their functioning in the context
of Industry 4.0;
– the subject literature usually applies to general definitions in this area; there are
scarce studies representing specific definitions and suggestions which can be trans-
lated into the practice of management.
According to the intent of the authors, the work is to show a broader perspective
for defining the competencies and capabilities in the context of a manager’s maturity.
The presented research does not exhaust the problem area of maturity of a manager,
however, the authors do hope that it will become a guideline at least to a minimum
extent for those who want to make changes in their company.
2 Starting Point
2.1 From a Manufacture to the Era of Industry 4.0
The embryonic form of a capitalist enterprise was manufacture. Numerous production

inventions and improvements resulted in business growth—from small workshops,
manufactures to industrial plants. The transformations in the industry started at the
end of the eighteenth century, referred to as the Great Industrial Revolution was a
breakthrough period in the history of humanity (Adamiecki 1985). Thanks to the
technical development of work tools and manufacturing organizations (exchange-
ability of parts, manufacturing in production batches), the volume of the manufac-
tured goods increased, and they were produced in series (Niewiadomski 2016). In
the 1950s, the concept of production started to change. A new economy emerged,
with three basic attributes—it is global, favors intangible goods (ideas, information,
linkages and knowledge) and is internally highly interconnected. While the Third
Industrial Revolution consisted in the automation of individual machines and pro-
cesses, the next one brings along a comprehensive digital transformation of all assets
and deepened integration with partners contributing jointly to creating the value chain
within digital ecosystems.
The idea of Industry 4.0 is a very young concept (Magruk 2017). In many aspects,
particularly in the system perspective, it involves a high degree of uncertainty. Despite
a high level of complexity—in the opinion of the authors—it is necessary to run
research implying assimilation of the primary and practical knowledge in this scope.
Although the term ‘Industry 4.0’ has already been used for nearly 7 years, it
was coined for the first time during Hannover Messe in 2011 (Lee 2013; Qin et al.
2016). The term ‘Industry 4.0’ is often referred to as the Fourth Industrial Revolution
(Kagermann et al. 2013). On the European level, the term ‘Factory of the future’ was
proposed, in the United States ‘Industrial Internet’, while in China ‘Internet +’
(Mrugalska and Wyrwicka 2017).
among others InternetIndustry 4.0 cannot be assigned to one technology or a
single change in management methods (Kagermann et al. 2013; Lasi et al. 2014;
Schmidt et al. 2015). The Fourth Industrial Revolution is a concept related to use
of automation and data processing and exchange as well as the implementation
of various new technologies allowing the creation of the so-called cyber-physical
systems and change of the methods of manufacturing (Lee et al. 2015; Kagermann
2014). It also applies to production digitization, where technological devices and
systems are linked, also over the Internet, and where large production data volumes
are analysed (Łupicka and Grzybowska 2017). Here, Industry 4.0 is a conceptual
aggregate incorporating a number of new technologies (Dmowski et al. 2016)—

among others Internet of Things (Atzori et al. 2010; Zuehlkea 2010), computational
clouds (Xu 2012; Subashini and Kavitha 2011; Valilai and Houshmand 2013; Wang
and Xu 2013), Big Data analysis (Lee et al. 2014) artificial intelligence as well as
incremental print (S˛ep and Budzik 2015) augmented reality (Stadnicka and Antonelli
2014; Szulewski 2016) or cooperating robots (Stadnicka and Antonelli 2016).
The second dimension of Industry 4.0 is related to production management, orga-
nization’s operations, and value chain. Here, what changes, in particular, is the archi-
tecture of production management systems and transition from line processes and
the traditional production management systems pyramid to a network of connections
and nonlinear manufacturing. A combination of the previously mentioned innova-
tions with new capabilities concerning artificial intelligence can consequently lead
to a revolutionary change in manufacturing management methods, where systems
would operate in a highly autonomous way, dynamically changing their structure
and functions within the organization.
Due to the continuous and sudden variability in conditions, enterprises must create
new characteristics, behaviours and attitudes, which will be an adequate and effec-
tive answer to the globally transforming reality. In the era of the Fourth Industrial
Revolution very important is the role and significance of qualified management staff,
who should stand out with their unique competencies and dynamic capabilities as
well as substantive preparation to work in a specific environment. This means that a
typical characteristic of the present era is recognition of competencies and dynamic
capabilities as a critical factor determining survival or development of the organiza-
tion, and skillful management of the attribute being dynamic competencies becomes
(in the conditions of uncertainty and dynamical changes) a factor that determines the
manager’s maturity.
Contemporary managers are expected to create effective enterprises that will
demonstrate systematic, excellent performance in the long run while preserving the
highest level of customer satisfaction and employee commitment. The new manage-
rial competencies paradigm is evolving towards more aspiring leader’s competencies,
which are the leverage for the organization’s competitiveness. In fact, a high produc-
tion environment will require qualified management staff and production employees
with experience in working with new materials, technologies, machines, and espe-
cially data and information.
2.2 Manager’s Maturity in the Opinion of Experts [PS1 ]
To speak about the reality, phenomena and processes related to the generally under-
stood management, the scope of the terms resulting from the research should be
clearly specified. Since the term ‘manager’s maturity’ is rarely present both in col-
loquial thought and in scientific studies, the authors have regarded as justified to
nominate a definition significantly corresponding to the subject matter of the present
research (Irizar and Wynn 2019; Al Aboodi 2006; Elmaallam and Kriouile 2011;
Skrzypek 2014). It is important to develop, adopt and consistently apply and under-
stand the term, the more so that there is no precisely determined meaning of it.
Attempts taken in this study to order terms have only had the cognitive advantage,
allowing the authors to conduct the basic research.
How is the notion ‘manager’s maturity’ understood by representatives of manufac-
turing enterprises from the Polish agricultural machines sector? The above question
and the conviction about the presence of business demand for results being applica-
ble in nature were the main inspiration to undertake the research. It seems that the
complexity of the problems and the so far limited scientific recognition justify the
treatment of the mentioned issues as the subject matter of the research.
According to the intent of the authors, the research is to show a broader per-
spective for defining the ‘manager’s maturity’. The presented research findings have
given direction for the authors’ further works. Performing the initial research [PS1 ],
the authors used the method of literature studies and discussion among intention-
ally selected experts. For this purpose, a team composed of 23 persons was cre-
ated, including representatives of small (5 persons), medium (14 persons) and large
(1 person) manufacturing enterprises functioning in the agricultural machinery
sector and representatives of: the Industrial Institute of Agricultural Engineering
(1 person), a higher education school (1 person), Department of Regional Policy,
Marshal’s Office of the Wielkopolska Voivodeship—Deputy Director (1 person).
When selecting the experts, their knowledge, broad, holistic perspective, indepen-
dence and practical experience in organization and management were taken into
account. In each case, those were professionally active persons, dynamically partici-
pating in the management of the enterprise they come from and work for. In relation
to the presented principles and literature concepts, and based on the experience from
their companies, the task of the experts was to present their own views in the discussed
scope.
In the authors’ view, research conducted based on a large number of variables
would strongly complicate implementation—prevent the formulation of essential
conclusions—it was important to determine a short list of definitions—resulting
from observations of the management practitioners. In 15 min, each person had a
possibility to write down, on a piece of paper, the catalogue of desiderata constituting
a manager’s maturity. The research authors wrote down all the mentioned character-
istics, grouped similar ideas together, which later made it possible to determine the
final list of 23 definitions (Table 1).
A preliminary study was a precondition for conducting the proper research; the
main intent of the authors was to determine the dimensions which would best reflect
the sense of the notion: manager’s maturity. The purpose of the discussion was only
the right selection of the definitions without ranking them. The point was to create a
collection from which it could be possible to choose the terms most corresponding
to the problem raised in the study. The list was built so as to ensure that it can be
modified and supplemented as required, in fact, it was assumed that the specified
characteristics are not fixed categories.
The presented definitions provide the context of different approaches. The essence
of the manager’s maturity presented by the particular expert is relatively scattered;
Table 1 Manager’s maturity—insights among the experts

No. Definitions
1 Ability to learn quickly adapting the manager to changes realizing different optional
actions at the same time
2 Being in readiness for intensive development—by pursuing properly designed and
adjusted—according to the goals adopted by the organization—personal competences
(knowledge, skills, personal characteristics, experience, motivations, attitudes and
behaviours)
3 Manager’s creativity; thinking leading to original and relevant solutions being obtained;
capacity of creating something new
4 Knowledge in the field of organization and management, knowledge of technologies,
designs, machine operation and design; ability to practically use data and information;
experience being resultant of tasks being performed and implementation projects
5 Knowledge, skill, experience and motivations to implement evolutionary and
revolutionary change
6 Knowledge, skills, characteristics and experience implying the manager’s capacity of
provoking and using opportunities
7 Ability to dynamically adapt the company’s goals to the conditions in which the manager
is forced to act
8 Knowledge, experience and skill in using the resources being at the disposal of the
enterprise; machines, tools and devices for processing and manufacturing
9 Collections of knowledge and skills underlying the enterprise’s sustainable competitive
advantage. These are substantially intellectual in nature and are related to the
management systems
10 Ability to practically apply knowledge determining the ability to immediately respond to
change, what, by a properly harmonized reconfiguration of the resources, implies the
possibility to use the opportunities emerging in the environment
11 Key managerial competencies being a bundle of knowledge, skills, experience and
capabilities underlying the enterprise’s competitive advantage
12 Knowledge implying the skill of adaptation to changes taking place within the company
and in its environment
13 Knowledge, experience, attitudes and behaviours which will result in the pursuit of
developing new technologies, and later, having the dynamic capabilities, with their
proper reconfiguration, will imply a sustainable leading business position
14 Ability to solve management (managerial) and technological problems based on the
acquired knowledge, characteristics and experience
15 Knowledge, experience, capabilities and predispositions for teamwork used at the
workplace, specific skills required at work and personal culture
16 Predispositions, knowledge, experience, attitudes, motives and behaviours (intangible
resources) allowing efficient, effective and productive management aimed at the ability to
use and provoke opportunities emerging in the environment
17 Dispositions concerning knowledge, skills, attitudes and behaviours making it possible to
undertake production and managerial tasks on a properly high (mature) level
(continued)
Table 1 (continued)
No. Definitions
18 Knowledge, capabilities, predispositions, experience, (routine) and motivations that, with
the manager’s personal culture, get the enterprise closer to the achievement of the
adopted objectives and principles
19 Manager’s strategic potential, which, through knowledge, skills, personal characteristics,
attitude and experience, contributes to achieving specific (desired) results
20 Visible characteristics, in the form of knowledge, skills, experiences and behaviours,
allowing successful management, including use of any opportunities emerging in the
direct and further environment
21 Art of effective, responsible, energetic, economic and skilful management of the whole
of matters, material, capital, human and information resources, intended to pursue the
assumed goals and tasks
22 Integrated use of capabilities, personality traits as well as the acquired knowledge and
skills, for successful management
23 Manager’s strategic capabilities giving them a possibility to undertake operations that are
difficult to imitate. They are to be developed in order to take advantage of the new
opportunities. Competencies and capabilities are indicated, which are treated in the
company as unique resources
Source Own development based on research
some of the proposals are limited to reaction, others only to the adaptation to the
changing conditions, still others restrict the scope of maturity to knowledge, skills,
characteristics or attitudes.
Manager’s maturity assumes a certain combination of knowledge, skills, personal
characteristics, experiences, attitudes and behaviours which help the manager under-
take what the other employees are not able to. Adoption of the assumption that the
manager’s maturity is illustrated by both individual skills and experience and discrim-
inative ways of action within the company, allows for deriving the conclusion that
the essence of maturity consists in the ability to create, transform, collect, integrate
and use thereby assimilated competencies and dynamic capabilities.
3 Research Method
3.1 Preliminary Study [PS2 ]
Performing the preliminary study [PS2 ] aimed at developing the research form, the
authors used the method of literature studies and creative discussion among inten-
tionally selected persons. The inspiration for preparing the assessment tool were
the works of Polish (Bieniok 2016; Bratnicki 2000; Grzybowska 2012; Grzybowska
and Łupicka 2016, 2017; Rakowska 2005, 2017; Szczepańska-Woszczyna 2014;
Łupicka and Grzybowska 2017), and foreign (Katz 1974; Ortega 2010; Quinn and
Hilmer 1996; Spencer et al. 1990; Antti and Greenhalgh 2012; Boytazis 1982; Cap-
pellen and Janssens 2008; Ena and Sahoo 2014; Woodruffe 1991; Quintana et al.
2014; Rothwell and Lindholm 1999; Trivellas and Drimoussis 2013; Teece et al.
1997; Teece 2007, 2012) researchers. Preliminary study—being a precondition for
conducting the proper research [MS0]—was intended to develop the research form
as a list of key factors confirming Industry 4.0 manager’s maturity level.
At the stage of formulating the list—in order to adapt the research tool to the
examined sector and limit the amounts of the generated desiderata—the technique of
open discussion in a group of 15 persons directly related to the agricultural machinery
sector was used. The characteristics of the experts are presented in Table 2.
In the discussion, two stages were distinguished: in the first one, the theoretical
model of factors formulating the manager’s maturity level was presented, while in
the second one individual experts put new suggestions forward, trying to indicate
practical solutions in the scope concerned. Taking under consideration the ease of
assembling a proper group of competent interlocutors, the possibility to animate the
group to stimulate creative thinking, low cost of performing the research and the
possibility to generate a high number of ideas in a short time, it was recognized
as justified to nominate the proprietary method 335. Over 5 min, each expert—by
Table 2 Characteristics of the experts

Group/Institution/Position Number Specialization Share (%)
Owners and co-owners of 8 Organization and Management, 53.33
manufacturing enterprises in the owner’s supervision
agricultural machines sector
Managers of manufacturing 4 Organization and Management; 26.66
enterprises in the agricultural managerial supervision
machines sector
Industrial Institute of Agricultural 1 Modelling machine safety and 6.67
Engineering assessment of conformity with
Research Laboratory requirements of EU directives and
Manager standards harmonized at the stage
of concept and product designing
Business Centre Club expert 1 Management strategies, SME 6.67
innovation,
science-knowledge-business
cooperation
Consultant/Expert/Practitioner 1 For over 12 years linked with 6.67
manufacturing companies;
directly coordinates lean projects;
has ISO 31000 Certified Risk
Manager qualifications; a
representative for Integrated
Management System (ISO 9001,
ISO 14001, PN-EN 18001)
Sum (%) 100
Source Own work based on research
Table 3 Characteristics of spaces oriented on maturity assessment

No. Space Acronyms Number of assessing indicators
1 Knowledge management ZW 13
2 Skills/Capabilities UZ 15
3 Personal CO 14
characteristics/Predispositions
4 Experience DO 1
5 Motivations/Attitudes/Behaviours MPZ 10
Sum 53
Source Authors’ own study
writing down on a piece of paper—had the possibility to nominate 3 components

proving Industry 4.0 manager’s maturity. Then, after 5 min he or she gave the card to
the subsequent person who added their observations. After the next 5 min, the card
went to the hands of the subsequent expert. In this way, after 3 rounds the group of 15
experts generated 135 desiderata. After the end of the session, the assessment of the
obtained results was summed up. The authors wrote down all the mentioned char-
acteristics, grouped similar ideas together, which later made it possible to determine
the final list of 53 indicators consistent with the five spaces oriented on Industry 4.0
manager’s maturity (Table 3).
Assessing the manager’s maturity, the authors focused on persons having appro-
priate experience in the industry. Attention was paid to ensuring whether knowledge
and skills gained in one field can be used in new circumstances in a new and creative
way. Given the above, the assessment is unambiguously positive.
In order to conduct the research, a five-grade scale was adopted to describe the
Industry 4.0 manager’s maturity level corresponding to the separated assessment
spaces. The respondents were asked to assess the particular 4.0 manager’s maturity
indicator in the scale 1–5, where 1 means very low maturity within the examined
indicator, while 5—very high.
3.2 Proper Research [BR—Basic Research]
The basic stage of the research [BR] was performed in the period November–Decem-
ber 2018. For this purpose, direct meetings were used as well as—in order to obtain
a higher level of representation of the examined target group and collect answers
as quick as possible—additionally the surveys were provided to selected partners
cooperating with the Spare Parts and Agricultural Machinery Production Company
‘Fortschritt’ and Industrial Institute of Agricultural Engineering as parties of the
research.
83 managers of micro—11 persons (13.25%), small—24 persons (28.92%),

medium—42 persons (50.60%) and large—6 persons (7.23%) manufacturing enter-
prises in the agricultural machinery sector took part in the study. For the needs of
the preliminary study, it was assumed that a manager is a managing person, and the
one who appoints him or her to this role is the owner of equity contributed to the
company, sometimes its founder and originator. Managers are all the employees of
the company who were given superiors’ functions—starting from a master, to the
president of the board or owner.
29 owners (34.94%), 24 managers (28.92%), 7 presidents of the board (8.43%),
3 members of the Management Board (3.61%), 2 proxies (2.41%) and 18 directors
(21.69%) took part in the study. Such positions as the following were identified among
the participants: Purchasing Department Manager, Distribution and Logistics Man-
ager, Area Manager, Cost Optimization Project Leader, Logistics Manager, Senior
Project Buyer, Global Category Manager, Purchasing Manager, Strategic Clients
Manager, Individual Clients Manager, Production Director, Sales and Marketing
Manager, etc.
Structure analysis of characteristics of 83 enterprises the managers of which
attended the study shows that companies based only on Polish capital (81.93%)
dominate among them, present on the market for over 10 years (77.11%). Less than
half (45.78%) of the enterprises participating in the study are organized as a company;
80.72% declare operations on the domestic and foreign markets.
The age of those surveyed was between 24 and 73 years (including: 2.41% man-
agers were below 30 years; 24.10% were persons 31–40 years old, 38.55% were
41–50 years old, 25.30% were 51–60 years old, while 9.64% were manager less than
60 years old). Detailed characteristics are depicted in Table 4.
Among the surveyed, the group of persons with high school and higher educa-
tion was the biggest: (96.38%), 68.67% of which had higher education, 27.71%—
medium, 3.61%—professional education. Detailed characteristics are depicted in
Table 5.
One of the most important stages in the research process is the analysis and
interpretation of the research results. That is why further in the paper an attempt has
been made to interpret the results and perform a deeper study based on respondents’
declarations. It was necessary to describe the obtained data.
4 Manager’s Maturity—Research Findings
Manager’s maturity 4.0 is a result of the accumulation of impacts of many factors,

which include the ability to function within a market partnership. Modern managers
must be open to new trends in the functioning of enterprises, first of all resulting
from globalization challenges, work online, technological innovations implying the
opportunity to build competitive advantage and continuous pursuit of new knowl-
edge. The existing competition results in new problems being formed, and, first of
all, increases requirements for the management staff.
Table 4 Characteristics of surveyed managers—age distribution

Manager/Position Age
<30 31–40 41–50 51–60 >60
Owner N N =1 N =8 N = 11 N =7 N =2 29
% 1.20 9.64 13.25 8.43 2.41 34.94%
Manager N N =1 N = 10 N =9 N =4 N =0 24
% 1.20 12.05 10.84 4.82 0 28.92%
President of the Board N N =0 N =0 N =3 N =3 N =1 7
% 0 0 3.61 3.61 1.20 8.44%
Board Member N N =0 N =0 N =1 N =2 N =0 3
% 0 0 1.20 2.41 0 3.61%
Proxy N N =0 N =0 N =1 N =0 N =1 2
% 0 0 1.20 0 1.20 2.40%
Director N N =0 N =2 N =7 N =5 N =4 18
% 0 2.41 8.43 6.02 4.82 21.69%
N 2 20 32 21 8 83
% 2.41 24.10 38.55 25.30 9.64 100%
Table 5 Characteristics of surveyed managers—distribution according to education

Manager/Position Education
Professional High school Higher
Owner N N =3 N = 11 N = 15 29
% 3.61 13.25 18.07 34.94
Manager N N =0 N =7 N = 17 24
% 0 8.43 20.48 28.92
President of the Board N N =0 N =1 N =6 7
% 0 1.20 7.23 8.43
Board Member N N =0 N =0 N =3 3
% 0 0 3.61 3.61
Proxy N N =0 N =0 N =2 2
% 0 0 2.41 2.41
Director N N =0 N =4 N = 14 18
% 0 4.82 16.87 21.69
N 3 23 57 83
% 3.61 27.71 68.67 100%
The problem of maturity of persons who manage enterprises—although is not

a new problem—is presently the current topic and the subject of interest of many
researchers. Literature analysis shows that characteristics of a mature manager 4.0
have been described by a few researchers; among others, attempts were made to find
skills that managers 4.0 demonstrate to a bigger extent than modern managers.
The subject literature most commonly presents model sets of competencies of
mature managers employed in miscellaneous organizations. On the other hand, the
literature definitely misses a scientific examination of profiles of managers who
manage enterprises from the agricultural machines sector. The found and above
described knowledge gaps have created a problem situation and have become the
motive for the authors to undertake research the results of which are depicted in the
following Table 6.
The surveyed managers declare a high level of assimilated comprehensive con-
cerning knowledge in organization and management (average score 4.47; 57.8% of
the indications for 5-point score). They are prepared for performing different man-
agement tasks and organizational roles related to running a business. They have
competencies allowing correct decisions to be made concerning both the business
strategy as a whole as well as functional strategies.
In response to large market saturation and the rapidly changing environment,
managers demonstrate a high level of knowledge regarding what to produce (aver-
age score 4.46; 55.4% of the indications for 5 point score) how to produce (average
score 4.31; 47.0% of the indications for 5 point score) and whom to sell the product to
(average score 4.43; 55.4% of the indications for 5 point score) and what marketing
actions they should take for this purpose (average score 4.41; 54.2% of the indica-
tions for 5 point score). As, for contemporary companies, creating new products is
the essence of innovative operations and gives the direction for their development,
the knowledge—assimilated by managers—regarding new technologies and inno-
vations becomes key for achieving and maintaining their companies’ competitive
advantage (average score 4.40; 53.0% of the indications for 5-point score). Such
knowledge should be protected and—though it seems controversial in the context of
the omnipresent orientation on the vision of unrestricted knowledge sharing—made
available to a minimum extent only to selected employees for whom it is necessary
for work. In this regard, managers declare significant moderation (average score 4.00;
32.5% of the indications for 5 point score).
The need to operate databases and the algorithmic thinking ability will become
common in the face of Industry 4.0, allowing new programming languages to be
learned fast. Manager’s maturity in this area was authenticated by knowledge of
cybernetic technologies and analytical systems (average score 3.99; 38.6% of the
indications for 5-point score), general practical knowledge on project implementation
in IT (average score 4.11; 32.5% of the indications for 5 point score) and automation
and robotics (average score 4.02; 27.7% of the indications for 5-point score).
The need to smoothly and timely perform complex and largely unique projects
have made projects and project approach become a permanent element of current
business operations. The special nature of project implementation and the character-
istics distinguishing them from among 1–6 other operations of an enterprise create
Table 6 Knowledge management—assessment of manager 4.0’s maturity

Descriptors 1 2 3 4 5 ŚR.
%
Management knowledge Knowledge sharing and – – 27.0 29.0 27.0 4.00
knowledge base creation – – 32.5 34.9 32.5
Production knowledge – 1.0 11.0 32.0 39.0 4.31
– 1.2 13.3 38.6 47.0
General practical – 1.0 16.0 39.0 27.0 4.11
knowledge concerning – 1.2 19.3 47.0 32.5
implementation in IT
General knowledge – 2.0 17.0 41.0 23.0 4.02
concerning automation – 2.4 20.5 49.4 27.7
and robotics
Project knowledge – 1.0 8.0 33.0 41.0 4.37
– 1.2 9.6 39.8 49.4
Knowledge concerning – 1.0 7.0 27.0 48.0 4.47
organization and – 1.2 8.4 32.5 57.8
management
Marketing knowledge – 2.0 7.0 29.0 45.0 4.41
– 2.4 8.4 34.9 54.2
Knowledge of clients and – 1.0 8.0 28.0 46.0 4.43
market – 1.2 9.6 33.7 55.4
Economic knowledge – 4.0 13.0 29.0 37.0 4.19
– 4.8 15.7 34.9 44.6
Knowledge of cybernetic 2.0 7.0 13.0 29.0 32.0 3.99
technologies and 2.4 8.4 15.7 34.9 38.6
analytical systems
Knowledge regarding – 1.0 9.0 29.0 44.0 4.40
new technologies and – 1.2 10.8 34.9 53.0
innovations
Knowledge about – 1.0 6.0 30.0 46.0 4.46
products – 1.2 7.2 36.1 55.4
Command of foreign 1.0 3.0 11.0 35.0 33.0 4.16
languages 1.2 3.6 13.3 42.2 39.8
specific requirements regarding project knowledge, namely knowledge related to

project implementation. Therefore, in the context of Industry 4.0 challenges, new
knowledge becomes essential, gathered or created throughout the project implemen-
tation time, which, for the surveyed managers, is also used after its completion; the
managers are characterized by a high maturity level in this area (average assessment
4.37; 49.4% of the indications for 5-point score). Attention is paid to a high level
of the managers in terms of economic knowledge assimilation (average score 4.19;
44.6% of the indications for 5-point score). The gained economic knowledge allows
opportunities and threats related to the operation of the market to be recognized,
giving managers 4.0 an opportunity to make informed decisions, especially financial
ones.
As a result of the conducted research, the achievement of the goal of the study has
been made easier. The made analysis of the knowledge level among the managers,
which was codified in the form of 13 questions, allowed the hypothesis formulated
at the beginning to be verified and confirmed. Based on the research in the scope of
knowledge management, it may be stated that managers demonstrate a significant
maturity level, what makes them able to function in the era of Industry 4.0.
In order to perform the next stage of manager 4.0’s maturity assessment, a set of
assessing research questions was prepared (Table 7).
A typical operation that drives the development of businesses and each man-
ager’s results is decision-making. The conviction as to whether managers are aware
of their own decision-making process, method or are not aware of which models,
thinking schemes they use, proves their maturity (average score 4.47; 51.8% of the
indications for 5-point score). It is sure that better quality decisions improve business
performance.
Due to competitive pressure, many businesses begin cooperation with other com-
panies without proper preparation, not understanding the partner’s needs, objectives
and expectations. Such cooperation often ends with failure (Duysters et al. 1999),
as the absence of conformity of the objectives and compatibility among the partners
leads to conflicts and opportunistic behaviours (Moeller 2010). That is why so essen-
tial is—in the context of manager 4.0’s maturity—the ability to select the business
partner, which is something more than just a well-considered process based on quite
a rigid set of criteria and, for the surveyed managers, it is realized on a very high
level (average score 4.43; 50.6% of the indications for 5-point score).
A mature manager 4.0 is a person affecting behaviour of the employees and
focused on improvement of their performance, which is later to contribute to growth
in organizational effectiveness (average score 4.41; 49.4% of the indications for
5-point score), having the ability to break the problem down into pieces and rediscover
the sense and the logical structure in it (average score 4.36; 44.6% of the indications
for 5-point score), and a high level of permanent memory, intelligence of words,
items, facts and relations, the manager faces while performing their job (average
score 4.36; 47.0% of the indications for 5-point score).
The high maturity level of the surveyed managers is proven by the ability to learn
quickly—as declared by themselves (average score 4.33; 47.0% of the indications
for 5-point score), and the ability to delegate decision-making authorities to other
Table 7 Skills and capabilities—assessment of maturity of manager 4.0

%
Skills capabilities Ability to build, 2.0 4.0 23.0 36.0 18.0 3.77
standardize dictionaries of 2.4 4.8 27.7 43.4 21.7
the terms related to
modern technologies
present between
supplier–company–client
Ability to define – 1.0 14.0 33.0 35.0 4.23
objectives – 1.2 16.9 39.8 42.2
Ability to select partners – – 6.0 35.0 42.0 4.43
– – 7.2 42.2 50.6
Conciliatory capabilities; 1.0 2.0 8.0 35.0 37.0 4.27
ability to solve conflicts 1.2 2.4 9.6 42.2 44.6
Perceptive capabilities 1.0 3.0 7.0 38.0 34.0 4.22
1.2 3.6 8.4 45.8 41.0
Ability to learn quickly 1.0 1.0 7.0 35.0 39.0 4.33
1.2 1.2 8.4 42.2 47.0
Organizational-planning 1.0 1.0 7.0 38.0 36.0 4.29
capabilities 1.2 1.2 8.4 45.8 43.4
Analytical skills – 1.0 5.0 40.0 37.0 4.36
– 1.2 6.0 48.2 44.6
Decision-making abilities – – 4.0 36.0 43.0 4.47
– – 4.8 43.4 51.8
Intellectual capabilities – 1.0 7.0 36.0 39.0 4.36
– 1.2 8.4 43.4 47.0
Research skills 2.0 4.0 21.0 39.0 17.0 3.78
2.4 4.8 25.3 47.0 20.5
Motivational abilities – 1.0 5.0 36.0 41.0 4.41
– 1.2 6.0 43.4 49.4
Ability to delegate rights – 2.0 5.0 40.0 36.0 4.33
– 2.4 6.0 48.2 43.4
Ability to design target 1.0 3.0 17.0 39.0 23.0 3.96
organiza-tional-human 1.2 3.6 20.5 47.0 27.7
structures required for
operation of highly
automated produc-tion
parks
Prognostic abilities 1.0 2.0 7.0 39.0 34.0 4.24
1.2 2.4 8.4 47.0 41.0
Source Own development based on research
employees in the enterprise (average score 4.36; 43.4% of the indications for 5-point
score).
Monitoring the inventory level of raw materials, materials, products or other means
of production used in work, supervision over production plans and implementation
of the enterprise’s budget principles—are sample tasks that, in the context of Indus-
try 4.0, are faced by a contemporary manager. Individuals employed in this position
will be responsible for supervision over the orders schedule or performance of the
work plan as well as preparation of studies on the basis of which the efficiency of
the production process is specified. The managers responsible for the continuity of
operations in an enterprise are therefore expected to have planning abilities, which,
for the surveyed managers, foreshadow a high level of performance of the mentioned
activities (average score 4.29; 43.4% of the indications for 5-point score). In the con-
text of the above, attention is paid to prognostic abilities (average score 4.24; 41.0%
of the indications for 5 point score) implying strategy formulation and planning based
on the respective methods, as necessary to create the future of the company. It is a
basic task of the executives. Managers 4.0 must have the ability to forecast the future
position of the company and take account of different options of its development,
see the opportunities and identify the risk.
Conflicts are unavoidable and certainly inherent in professional life. They are
a frequent and natural phenomenon, resulting from the dynamics of the processes
taking place between people. However, it is certain that it can be learned how to
prevent conflicts, neutralize their effects and solve them for the benefit of both parties
involved—which is proven by declarations of the surveyed managers; they declare
a high level of empathy and self-control, which proves their emotional maturity
(average score 4.27; 44.6% of the indications for 5-point score).
In its job, a manager is responsible, on the one hand, for good management of
the entrusted management area, and, on the other hand, for improvements and new
solutions permanently raising the company’s goodwill, namely for their objectives.
Therefore, the ability to imagine what the company is to achieve, what is the desired
condition as well as the ability to define indexes allowing to identify that it is already
the target condition—assimilated by the surveyed managers on a very high level
(average score 4.23; 42.2% of the indications for 5 point score)—proves a high level
of their maturity.
A mature manager, in order to effectively perform management functions and
efficiently perform their tasks, should do all their best to ensure that communication in
the organization is constructive. Development of correct relations with subordinates
and partners, organizing teamwork and group-based making of the most important
decisions require the manager to have perceptive skills (average score 4.22; 41.0%
of the indications for 5 point score).
With the high self-esteem of the mentioned desiderata (average above 4.00) it is
necessary to mention a slightly lower level of assimilated skills of designing target
organizational-human structures related to the operation of highly automated pro-
duction parks (average score 3.96; 27.7% of the indications for 5-point score) and
the ability to build, standardize dictionaries of the terms related to modern technolo-
gies present between supplier–company–client (average score 3.77; 21.7% of the
indications for 5 point score). While the level of assimilation of these two compe-
tencies does not raise any greater anxiety among the authors, attention must be paid
to the need to immediately improve research skills (average score 3.78; 20.5% of
the indications for 5 point score), especially that a mature manager 4.0 seems like
a person who independently plans and performs research tasks or expert’s studies
using advanced technologies and research tools as well as documents and interprets
the obtained results.
The made analysis of the level of managers’ abilities and skills, which was codi-
fied in the form of 15 questions, authorizes the authors to determine that managers
demonstrate a significant maturity level, what makes them able to function in Industry
4.0.
In order to perform the next stage of manager 4.0’s maturity assessment, a set of
14 assessing indicators was prepared (Table 8).
Efficient management is also the art of clear and concise formulation of objectives
and skilful communication with people. A mature manager, in order to effectively
perform management functions and efficiently perform their tasks, should do all
their best to ensure that communication in the organization is constructive. Commu-
nication skills—a characteristic highly assimilated among the surveyed managers
(average score 4.57; 66.3% of the indications for 5-point score) allows proper rela-
tions to be established and maintained as well as organization of cooperation and
common work with subordinates, customers and other partners of the organization,
facilitating and improving performance of one’s own tasks.
Building personal authority and image are important personal traits of each man-
ager, significantly affecting his or her maturity. Apart from formal authority, giving
the right to command (issue commands), but not always imposing obedience, a man-
ager should have personal authority. It is gained by skilfully leading and being a
leader, which is a specialty of the surveyed managers (average score 4.40; 53.0% of
the indications for 5 point score) whose management is based to a certain extent on
sense and intuition (average score 4.29; 50.6% of the indications for 5 point score).
A mature manager 4.0 is a person open to building value added, responsible,
resistant to stress, operating without complexes, self-confident and having high self-
regard. He or she is characterized by creativity, a sense of strategy and courage in
making decisions. A high-class manager with extensive knowledge will not create a
productive team of employees, pursuing the company’s objectives and strategy, unless
he or she has a high level of emotional intelligence. Some have such abilities in a way
naturally, others must learn correct ways of conduct. One is certain: a manager 4.0
should have a high level of EQ. It is a person focused on action, likes risk and often
faces difficult situations. The made analysis of the level of personal characteristics,
codified in the form of 14 questions, authorizes the authors to determine that the
managers subjected to the study demonstrate a significant maturity level, which
makes them able to function in Industry 4.0 (Table 9).
A mature manager 4.0 is a person focused on cooperation, success and
development. He or she is characterized by tactful behaviour, truthfulness, justice,
honesty, kindness, high personal culture as well as ambition and professional passion.
Has a sense of self-fulfilment, doing what he or she actually wants to do.
Table 8 Characteristics and predispositions—assessment of maturity of manager 4.0

%
Characteristics Communication skills – 1.0 6.0 21.0 55.0 4.57
predispositions – 1.2 7.2 25.3 66.3
Sense of strategy – 2.0 8.0 29.0 44.0 4.39
– 2.4 9.6 34.9 53.0
Leadership; being a leader – 1.0 9.0 29.0 44.0 4.40
– 1.2 10.8 34.9 53.0
Focus on risk 1.0 3.0 13.0 29.0 37.0 4.18
1.2 3.6 15.7 34.9 44.6
Emotional intelligence 1.0 2.0 8.0 29.0 43.0 4.34
1.2 2.4 9.6 34.9 51.8
Sense and intuition 1.0 2.0 11.0 27.0 42.0 4.29
1.2 2.4 13.3 32.5 50.6
Openness to building value 1.0 4.0 16.0 35.0 27.0 4.00
added 1.2 4.8 19.3 42.2 32.5
Creativity – 2.0 10.0 35.0 36.0 4.27
– 2.4 12.0 42.2 43.4
Courage in making decisions 1.0 3.0 8.0 38.0 33.0 4.19
1.2 3.6 9.6 45.8 39.8
Self-confidence; confidence; 1.0 3.0 9.0 28.0 42.0 4.29
self-esteem 1.2 3.6 10.8 33.7 50.6
Responsibility – 2.0 7.0 28.0 46.0 4.42
– 2.4 8.4 33.7 55.4
Vision – 3.0 8.0 31.0 41.0 4.33
– 3.6 9.6 37.3 49.4
Resistance to stress 2.0 5.0 12.0 35.0 29.0 4.01
2.4 6.0 14.5 42.2 34.9
Absence of complexes 2.0 4.0 9.0 35.0 33.0 4.12
2.4 4.8 10.8 42.2 39.8
A mature manager 4.0 needs not only vision, authority, energy, imagination and
strategy formulation ability, but also the skills of activating the so-called soft factors,
as kind atmosphere at work or entrepreneurial thinking. And thus, he or she must
show courage, sincerity as well as strong will and a high level of aspiration and
ethical–moral attitude. The study of the level of attitudes, motivations and behaviours,
codified in the form of 10 descriptors, allows to conclude that the surveyed managers
Table 9 Attitudes, motivations and behaviours—assessment of maturity of manager 4.0

%
Attitudes, motivations Focus on cooperation – 2.0 10.0 35.0 36.0 4.27
behaviours – 2.4 12.0 42.2 43.4
Focus on success – 2.0 11.0 32.0 38.0 4.28
– 2.4 13.3 38.6 45.8
Focus on development – 2.0 11.0 37.0 33.0 4.22
– 2.4 13.3 44.6 39.8
Personal culture – – 8.0 24.0 51.0 4.52
– – 9.6 28.9 61.4
Keeping word – – 4.0 24.0 55.0 4.61
– – 4.8 28.9 66.3
Ethical standards – – 6.0 24.0 53.0 4.57
– – 7.2 28.9 63.9
Ambition; professional – – 7.0 31.0 45.0 4.46
passion – – 8.4 37.3 54.2
Self-fulfilment – 1.0 8.0 34.0 40.0 4.36
– 1.2 9.6 41.0 48.2
Moral standards; sincerity – 1.0 7.0 23.0 52.0 4.52
– 1.2 8.4 27.7 62.7
Entrepreneurial thinking – 2.0 8.0 45.0 28.0 4.19
– 2.4 9.6 54.2 33.7
are characterized by a substantial maturity level, what in the opinion of the authors
makes them able to function in Industry 4.0.
5 Summary
By the concept of a ‘mature manager’, the authors understand a person professionally

involved in management whose competences can be considered mature from a qual-
itative point of view. Maturity assessment can be different in each organization, but
in each case, for a manager to be mature, he or she must be efficient, predictable and
provide high-quality results. Manager’s maturity is the ability to achieve the objec-
tives and tasks focused on the systematic delivery of better and better operational
results. Manager’s maturity is the degree to which his or her competences allow the
implementation of the organization’s strategic goals. Maturity defines ‘the state of
being complete, excellent or ready’. It is indicated that maturity develops gradually
as a result of a process in which desirable competencies are formed, allowing certain

tasks to be performed.
One of the basic research needs is the development of a universal model, to
enable assessment of the level of Industry 4.0 manager’s maturity. The need for such
an assessment tool is reported from the business environment. To authenticate the
existing research gaps, the authors of this research conducted a number of interviews
with managers representing the agricultural machinery sector. The obligatory nature
of the undertaken research also resulted from their daily observations of the ‘practice’
within the performed professional duties.
The research described in the publication aimed to examine the actual level of
maturity of a manager aspiring to function in the era of Industry 4.0. The adopted
research methodology allowed the authors to recognize the quantitative and qual-
itative resource among selected managers of enterprises operating on the Polish
agricultural machinery market. The collected research material allowed conclusions
to be formulated, these being general and cognitive in nature. In the chapter, a pro-
cedure and a tool were proposed, allowing identification of key maturity designata,
which, as the authors believe, will contribute to completing, in a fragmentary way,
the absence of knowledge in this area.
The maturity assessment method presented in the chapter is part of a comprehen-
sive approach to self-assessment of managerial competencies. It is used to indicate
strengths and weaknesses and to identify areas requiring improvement.
The surveyed managers declare a high maturity level in particular areas, which, as
the authors believe, proves their transformation according to the concept of the new
generation era. A contemporary manager is required to constantly improve his or her
knowledge and improve managerial skills. His or her tasks involve, first of all, the
analysis of the market and other components of the environment, improvement of the
information system, especially IT systems, planning and organization. A manager
is ‘mature’ and successful in managerial work, if, apart from knowledge, skills,
personal characteristics, attitudes, motivations and behaviours, he or she has vast
experience.
Assuming rigid experience requirements, it is assumed that knowledge and skills
gained in one field can be used in new circumstances in a new and creative way.
The presented research exhausts the problem area of maturity of a manager aspir-
ing to function in Industry 4.0, however, it is important that, at least to a minimum
extent, it becomes a guideline for persons wanting to improve their competencies.
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Partner Sales Networks as Determinants
of Road Maps for the Development
of the Telecommunications Industry
in Poland
Łukasz Brzeziński, Piotr Cyplik and Magdalena K. Wyrwicka
Abstract In the economy, there have always been cooperative agreements resulting
from the adopted tactics of enterprises or operational needs. Networking of the impli-
cators of changes and the development of the telecommunications industry in Poland
is related to partner sales networks. The creation of network structures results from
the search for new forms of task implementation. The text presents a study based on
data from 2017 (and earlier years) of the road map of the telecommunications indus-
try in Poland until 2022. System analysis method (network visualization) was used.
Individualized development scenarios for four companies forming the telecommuni-
cations industry in Poland were developed. In the analysis and visualization of large
networks, the “Pajek” program was used. A total of 10,694 network elements and
258,099 relations between them were examined. Among the main tendencies which,
in the authors’ opinion, will be revealed by 2022 in the telecommunications industry
in Poland are reduction of the number of employees, stores and dealers, reduction
of sales commission, the need to conduct costly tenders for telecommunications fre-
quencies, actions for increasing the attractiveness of the offer, and partnership with
other entity with the objective of combining the offer or selling products.
Keywords Network analysis · Road map of the telecommunications industry ·

Telecommunications industry in Poland · Relationships · Profitability of the
operation
Ł. Brzeziński (B)
Poznan School of Logistics, Poznan, Poland
e-mail: [email protected]; [email protected]
P. Cyplik · M. K. Wyrwicka
Faculty of Management Engineering, Poznan University of Technology, Poznan, Poland
M. K. Wyrwicka

288 Ł. Brzeziński et al.
1 Introduction
Planning at the company’s strategic level is one of the fundamental elements con-
sidered not only in the context of the system or management phases but also as
an opportunity to imply organizational development or in terms of survival on the
market. Therefore, one may point to the important role of forecasting future market
events and attempts to use both the opportunities associated with the broadly under-
stood diversification of operations and preparation for threats and adverse conditions
occurring in the environment and resulting in disruptions.
Contemporary strategic activity should take into account, in addition to economic
issues, also environmental protection and the need of the local community. In this
context, it should be noted on the idea of sustainable logistics. According to this
approach, the basic assumption of logistic activities (including sustainable develop-
ment) is to effectively use the potential of technology to meet ecological challenges,
while maintaining economic growth and improving the competitiveness of the entity
on the telecommunications market.
Forecasting and developing alternative scenarios in conjunction with planning is
even more important if the market or sector is already mature and shows a slight
increase in demand, even if it is in decline and revenues of competitors in the sector
are decreasing. This is the situation in the telecommunications industry, which is
the subject of the analysis contained in the chapter. Both the subsector of Internet
access services and mobile telephony (of key importance for the telecommunications
industry) recorded a decline in value in 2015–2017 (revenues of telecommunications
operators).
A telecommunications company is an economic entity authorized to carry out
economic activity consisting of the provision of telecommunications networks, asso-
ciated facilities, or the provision of telecommunications services, while a telecom-
munications entrepreneur entitled to (Raport…, 2018, pp. 5–30)
• provide telecommunications services is called a “service provider”;
• provide public telecommunications networks or associated facilities is called an
“operator”.
The service provider and operator may be the same entity—in this study, all
enterprises are both a service provider and an operator.
One may become a telecommunications entrepreneur after the entry into the reg-
ister of telecommunications undertakings kept by the President of the Office of
Electronic Communications (UKE). The telecommunications industry in Poland in
the context of functioning and organizational and capital links is an advanced and
complex network system (in particular, in the area of sales network).
A network is an organizationally related structure occurring inside and/or outside
the enterprise with its own resources and tasks. This structure is also a link between
the market and the company, by means of which, for example, the sale of goods takes
place.
Partner Sales Networks as Determinants of Road Maps … 289
There are three types of sales networks in telecommunications companies. These

are own sales network and partner sales network—also called external or dealership
network and mixed networks—where both previously mentioned solutions oper-
ate simultaneously. The functioning of own sales network depends entirely on the
resources of the enterprise: employees are employed on employment contracts. On
the other hand, partner sales networks are usually based on trade agreements, and
most of the operating costs are passed on to entities operating in this type of network.
Entities forming a partner sales network are enterprises. Therefore, the lead
entity—parent company (forming the network) establishes cooperation on the basis
of trade agreements (cooperation agreements) with partners who are to implement
the sales processes of products and services for the parent company. In turn, the
partners further shape their own sales structures.
The concept of network, in the aspect of economic sciences, describes the struc-
tural conditions through which separate nodes (people, computers and enterprises)
are connected with each other, through connections (bonds) and flows (Hakansson
and Snehota 1995; Child and Faulkner 1998; Ford et al. 2003; Reid et al. 2008;
Agndal and Nilsson 2009; Pfohl and Müller 2015).
The network’s functioning methods emphasize the appearance of new relation-
ships. The development of network organizations is a part of a wider process of
changes taking place as a result of contemporary developmental and competitive
challenges (Etzkowitz 2002; von Tunzelman 2004; Luoma-aho and Vos 2010; Met-
calfe 2010; Wachnik 2016). A dynamic network becomes a symbol of science, as
the only organization capable of attitude-free development or free learning, which
can accommodate a multitude of truly divergent elements. In this view, the web is a
possible solution, a model of diversity problem (Wasserman and Faust 1994; Kelly
1995, p. 25; Scott 2000; Symon 2000; Dolan et al. 2003; Inkpen and Tang 2005;
Kagami 2006).
The study consists of an analytical part containing the results of research on the
current state of the telecommunications market in Poland and a utilitarian one, in
which the methodology of own research and the road map of the telecommunications
industry in Poland until 2022 were included. The purpose of the text presented
hereinafter is the presentation of the potential development path.
2 Telecommunications Industry in Poland—Current Status
Telecommunications activity in Poland is connected with several market areas, such

as Internet access, mobile telephony, landline telephony and related services (e.g.,
mobile telephony and mobile Internet, mobile Internet and television, etc.). However,
the analyses included in the research part concerned mobile telephony and mobile
Internet. The functioning of the telecommunications market in Poland is governed
by the telecommunications law (Dz. U. of 2018, item 1954).
The number of users of mobile telephony has been systematically declining for
several years. At the end of 2017, active SIM cards totaled 53.3 million, which meant
a 4% decrease compared to 2016. Thus, the saturation of mobile telephony services

was lower and amounted to less than 139% compared to 144% in 2016 (Raport…,
2018, pp. 5–30).
According to Analysys Mason data, the average penetration of mobile telephony
services decreased slightly compared to 2016 in selected European countries as well.
According to the company, the saturation of mobile telephony services in Poland,
which amounted to 134.1%, was still higher than average, at 129. 9%, on the European
market. The declining trend in revenues from mobile telephony services started in
2012. In 2017, the total revenues of operators amounted to PLN 15 billion and were
almost 11% lower than in 2016. However, despite the decline in the value of the
mobile telephony market, it still continued to be the key area of telecommunications
activity, which accounted for 38% of total revenues from this sector (Raport…, 2018,
pp. 5–30).
Saturation of broadband Internet (landline and mobile) in Poland in 2017 was at
the level of 103% per household. In turn, penetration in relation to citizens amounted
to 38% in 2017. The value of the Internet access services market in 2017 was at the
level of PLN 4.7 billion. It was a drop of about PLN 0.2 billion compared to 2016.
Along with revenues, the average monthly revenue per subscriber also decreases. In
2016, it amounted to PLN 28.2, a year later, it was lower by PLN 1 and reached PLN
27.2 (Raport…, 2018, pp. 5–30).
The revenue structure in 2017 was very similar to the one from 2016. The operators
gained the greatest revenue from the Internet access service using dedicated mobile
devices (about 35% of revenues). The second place was taken by xDSL technology
(22%) and the third by TVK cable modem (20%) (Raport…, 2018, pp. 5–30).
The number of subscribers to the network access service remained at a similar
level when compared to 2016. In 2017, there were approximately 7.1 million users
of fixed-line Internet. 7.4 million people used mobile access. In total, approximately
14.5 million users had access to the Internet service (Raport…, 2018, pp. 5–30).
It should be noted that in the following years, the situation on the telecommunica-
tions market due to the intensity of competitive struggles, strong focus on reducing
prices of services by operators, as well as the decreasing number of customers may
be even worse. The telecommunications operator is under legal and administra-
tive pressure, especially in the context of new areas of activity (Grzybowska et al.
2014, pp. 1311–1319). Therefore, it seems reasonable to create forecasts and iden-
tify determinants of changes that may occur both in the environment and within
telecommunications entities.
3 Methodology of Own Research
In the research process, the entire statistical population was inferred from the infor-
mation collected during the statistical (representative) sample survey (Neyman 1938,
pp. 101–116).
The research sample consisted of all (four) enterprises which at the same time
constituted the entire telecommunications market in Poland in accordance with the
adopted base criteria. Based on the data of the Office of Electronic Communications,
it can be concluded that there were 23 business entities in 2015 in the telecommuni-
cations market in Poland. However, only four entities meet the following criteria:
• enterprises operate on the territory of the Republic of Poland,
• enterprises operate, in particular, in the mobile telephony segment,
• enterprises covered by the study use partner networks,
• partner networks, operating at the request of enterprises in the telecommunications
industry in Poland, carry out sales both on the business market and on the individual
customer market (sales to other natural persons),
• enterprises offer postpaid services, i.e., subscription services.
The aim of the research was to develop a road map of the telecommunications
industry in Poland until 2022. The leading method in this study was network analysis,
which is used to detect, describe, and identify relationships among groups of people
or organizations (Reid et al. 2008, pp. 345–352), as well as broadly understood
business operations (Kijkuit and van den Ende 2010, pp. 451–479).
The following network analysis indicators were used:
• node betweenness, the ratio of the number of shortest paths between any two nodes
going through a given node to the total number of all shortest paths, sometimes
betweenness is normalized in such a way that the maximum betweenness in the
network is 1, betweenness indicates which nodes are the most important ones, i.e.,
the probability with which a given factor (element) is crucial for all flows in the
network;
• the closeness of a given node is the average length of the shortest paths between
this node and all other nodes (it is the expected distance between a given node and
any other node), it is also a measure of the reach of a given node;
• cumulative value of a vector, the summed values of all connections from a given
network node, it parameterizes the scope of impact of a given factor on flows in
the network.
The discussed method is supported by various IT applications such as the
“Pajek” program (used in this study), developed by Vladimir Batagejl and Andrej
Mrvar, Brzeziński and Wyrwicka (2015), Brzeziński et al. (2016), Program for Large
Network Analysis (2015), Brzeziński and Wyrwicka (2018), thanks to which it is
possible to show the relationship and interaction between the elements forming the
partner sales networks and individual factors.
Network analysis is a combination of graph theory, statistics, computer science,
and matrix algebra and is applied in economics (Wasserman and Faust 1994). Such
an approach can be classified as a quantitative and qualitative combination in which
quantitative data are subjected to qualitative analysis and interpretation (Scott 2000).
4 Road Map of the Telecommunications Industry in Poland

Until 2022
The road map, including projections of possible changes, trends, and directions in
the future, were prepared on the basis of analysis and network visualizations of
partner sales networks of four telecommunications companies (marked as A, B, C,
and D), which are the development implicatures of the entire industry. The forecast
is medium-term and covers the period of the next 5 years (i.e., until 2022).
To identify the impact force, the scale commonly used in scenario methods was
adopted. During the research process, unique factors were selected for each of the
entities whose impact is stimulating (positive impact force) from 1 to 5 (where 1 is
a very weak impact and 5 a very strong impact) or destimulating (negative impact
force) –1 to –5 (where –1 is a very weak impact and –5 a very strong impact). For each
company, an individual set of factors has been defined (which may be stimulating
or destimulating). The factors were selected on the basis of the in-depth interview
conducted in connection with the case study method with the person managing the
partner sales network in the company. This is due to the specificity of each entity’s
operation and other conditions of the partner sales networks.
The factors and the strength of their impact on partner networks of the surveyed
enterprises are presented in Table 1.
In order to identify the factors that will have the greatest impact on the partner
sales network of the companies covered by the research, three indicators from the
field of network analysis will be applied: betweenness value, closeness value, and
cumulative vector value.
For each company, the values of betweenness, closeness, and cumulative vector
were determined, and a visualization of the partner sales network was created—
which, in addition to the employees’ structure, also included the impact (stimulating
or destimulating) of individual factors.
It should be noted that extremely complex dependence networks were created
during the analyses.
In enterprise A, the number of elements making up the network was 2673, while
the total number of connections (relations) was 83,243. Such a number of relation-
ships is difficult to illustrate in the figure. In enterprise B, the number of elements
forming the network was 2428, and the number of connections (relations) was 61,004.
In enterprise C, the number of elements making up the network was 3777, and the
number of connections (relations) was 71,825. In enterprise D, the number of ele-
ments making up the network was 1816, and the number of connections (relations)
was 42,027.
In enterprise A, in terms of the value of betweenness, the highest values applied
to work organization, workload, meetings and meetings with management, work
experience, lowering sales commission, current work, stress, enterprise values, sales
standards, partnership with another telecommunications entity, price competition,
tenders for telecommunications frequencies and company image (all at 0.45026).
Table 1 Identified factors affecting partner sales networks of enterprises A, B, C, and D

Entity Factors
A Absences, errors during work, lack of documentation for the contract, shortages of
expected products in the warehouse, manager’s decisions, additional tasks, form of
placing orders, number of clients, the amount of current work, completeness of
documents, workload, lowering sales commission, responsibility for the level of
service, responsibility for achieving goals, organization of work, partnership with
other telecommunications entity, creation of new stores, customer contact preferences,
promotions, telecommunications frequency tenders, reduction of partner network,
advertising with well-known people, complaints, meetings, sales standards, work
experience, stress, price competition, enterprise values, employment size, company
image, cooperation with other departments, business trips, communication guidelines
for employees, team management, reporting complaints by customers, customer
knowledge
B Absences, attractiveness of the offer, customer base, mistakes at work, cost reduction,
manager’s decisions, additional tasks, amount of current work, completeness of
documents, consolidation of telecommunications and energy services, number of
employees, methods of work, customer expectations, responsibility for service level,
planned reduction of stores and dealers, dismissals program, tenders for
telecommunications frequencies, complaints, way of placing orders, sales standards,
work experience, stress, company values, implementation of a new strategy, business
trips, team management, management meetings, customer knowledge
C Absences, attractiveness of the offer, manager’s decisions, additional tasks, investing
in fast wireless Internet technologies, amount of current work, number of employees,
company brand, lowering sales commission, responsibility for service level,
responsibility for achieving goals, planned reduction of stores and dealers, tenders for
telecommunications frequencies, advertising with well-known people, work
experience, application of ISO 9001:2008 standard in customer service, stress,
business trips, team management, management meetings, customer knowledge
D Absences, attractiveness of the offer, manager’s decisions, additional tasks,
development philosophy, amount of current work, number of employees, company
brand, network modernization, lowering sales commission, responsibility for service
level, responsibility for achieving goals, planned reduction of stores and dealers,
possession of an environmental management certificate ISO 14001:2004, tenders for
telecommunications frequencies, complaints, meetings, work experience, stress,
launch of fast Internet networks covering the majority of the country, launch of banking
services, price competition, business trips, team management, customer knowledge
In terms of closeness, these were promotions, work organization, workload, num-

ber of clients, lowering sales commission, current work, stress, mistakes at work,
enterprise values, partnership with other telecommunications entity, price compe-
tition, and company image (all at 0.986706). The highest destimulating (negative)
cumulative value of the vector had such factors as lowering the commission for sales
(–13180.000000) and reduction of the partner network (–9400.000000). The highest
positive (stimulating) value was the number of clients (10540.000000), partnership
with other telecommunications entities (10544.000000) and tenders for telecommu-
nications frequencies (13180.00000).
In company B, the factors of the highest betweenness value include additional

tasks, amount of current work, responsibility for achieving goals, work methods,
participation in management meetings, work experience, stress, enterprise values,
tenders for telecommunications frequencies, attempts at cost reduction, and consol-
idation of telecommunications and energy services (all at 0.57100). Factors with
the highest value of closeness indicator are additional tasks, the amount of current
work, responsibility for achieving goals, methods of work, work experience, stress,
enterprise values, tenders for telecommunications frequencies, pursuit of cost reduc-
tion, and consolidation of telecommunications and energy services (all at 0.98595).
Referring to the value of the cumulative vector, it is worth distinguishing factors such
as the attractiveness of the offer, enterprise values, consolidation of telecommunica-
tions and energy services, work methods, pursuit of cost reduction, and the amount
of current work. In turn, destimulating factors include dismissals program, stress,
planned reduction of stores and dealers, mistakes during work, additional tasks, and
absences.
On the other hand, in enterprise C, factors of the highest betweenness value include
investing in fast wireless Internet technologies, additional tasks, amount of current
work, attractiveness of the offer, meetings with management, work experience, stress,
and tendering for telecommunications frequencies (all at 0.88078). The highest value
of closeness was recorded in the following factors: investing in fast wireless Internet
technologies, additional tasks, amount of current work, attractiveness of the offer,
management meetings, work experience, stress, and tenders for telecommunications
frequencies (all at 0.994731). In terms of a summed vector with positive force, the
highest value had investing in fast wireless Internet technologies, attractiveness of the
offer, and tenders for telecommunications frequencies (18780.000000). The largest
destimulating impact had the planned reduction of stores and dealers and reduction
of sales commission (both at –13250.000000).
In enterprise D, however, the factors of the highest betweenness value included
the development philosophy, network modernization, possession of ISO 14001:2004
environmental management certificate, additional tasks, amount of current work,
attractiveness of the offer, work experience, stress, the company’s brand, tenders
for telecommunications frequencies, and price competition (all at 0.059049). The
factors of the highest closeness value include the development philosophy (70/20/10),
network modernization, possession of ISO 14001:2004 environmental management
certificate, additional tasks, amount of current work, attractiveness of the offer, work
experience, stress, company’s brand and price competition (all at 0.986949). The
highest value of the accumulated vector with a positive impact on the functioning of
the network was observed in the range of tenders for telecommunications frequencies
(8955,000000), development philosophy (70/20/10) (8955,000000), and possession
of environmental management certificate ISO 14001:2004 (8955,000000). The factor
of the highest destimulating influence has been the lowering of the sales commission
(–6500.000000).
Selected factors and the strength of their influence on individual elements of the
network were used to develop a road map of the telecommunications market in Poland
(Table 2).
Table 2 Road map of the telecommunications market in Poland

Entity Road map
A Synthesis of the road map until 2022: in the partner sales network, there will be a
reduction in the number of employees and lowering of the sales commission. This is
mainly due to lower sales profitability and growth dynamics of active SIM cards in
Poland. Winning tenders for telecommunications frequencies and entering into
partnerships with another telecommunications entity may give the enterprise access
to the provision of new services, which may slow down the process of lowering the
sales margin
B Synthesis of the road map until 2022: the most important factors are reductions in
the number of stores and dealers, attractiveness of the offer, tendering for
telecommunications frequencies, attempts at cost reduction, and the consolidation
of telecommunications and energy services. Such a combination of variables
suggests, on the one hand, a quantitative reduction in the number of employees and,
at the same time, an intention to maintain at least their current market share
C The synthesis of the road map until 2022: the management of company C, until
2022, will strive to reduce the structure of the partner sales network, there will also
be a reduction in commission payments for the sale of products and services.
Actions will also be taken to create a wireless mobile Internet infrastructure. Final
decisions regarding tenders for telecommunications frequencies will be crucial
D Synthesis of the road map until 2022: company D management board will take
actions related to reducing the number of employees of the partner sales network
and the commission for the sale of products and services. There will be a price fight
with competitive enterprises, combined with building the attractiveness of the offer,
conducted with the objective of obtaining or improving the position on the
market—but with considerably smaller sales forces. The results of
telecommunications tenders and investments in infrastructure modernization will
also be important
Total The next 5 years will be determined by factors such as telecommunications tenders,
market building the attractiveness of the offer, and investing in telecommunications
infrastructure. It can be assumed that the commission for the sale of products and
services will be further reduced, the competitive struggle between market
participants will increase, the number of stores and dealers will be reduced together
with the profitability of sales
The most important indication for the roadmap is the fact that in the next 5
years, there will be a reduction in the number of people involved in the activities
of the partner sales network. This is related to the decreasing growth rate of the
telecommunications market and the deterioration of sales profitability.
5 Conclusions
The main factors that will shape the scope of activity and the structure of the
researched telecommunications companies in the period up to 2022 include
• reductions in the number of employees, stores, and dealers,

• lowering the sales commission,
• tenders for telecommunications frequencies,
• attractiveness of the offer,
• partnership with other entities with the objective of combining the offer and sale
of services and products.
In addition to the factors discussed above. The analysis also included promotions.
They constitute an extremely important determinant of the activity of the entire
sales network (not only partner network). Having an offer with unique features that
distinguish a given service or product among competitors is an asset that cannot be
overestimated. The price competition, related to the promotions, will grow in the
coming years (Brzeziński and Wyrwicka 2018).
Therefore, it can be concluded that there will be a reduction in the number of sales
representatives and a reduction in their sales commission. This is mainly due to lower
sales profitability and growth dynamics of active SIM cards in Poland. Thanks to
winning tenders for telecommunications frequencies and entering into partnerships
with other entities, the companies from the telecommunications industry in Poland
will be able to gain access to the provision of new services. The attractiveness of the
offer is a key aspect in maintaining the desired sales dynamics despite the reduction
of resources involved in sales.
Telecommunications enterprises generally implement two types of strategies:
immediate and long-term. The first concerns new customers and taking over cus-
tomers from competitors, the second concerns staying on the market. The solu-
tions regarding telecommunications frequencies are crucial. The first one was for
1800 MHz, for which two companies are going to pay PLN 500 million. The most
important, however, will be the fight for the frequency of fast mobile Internet,
800 MHz. Practically every company is focused on supplementing the offer with
such services.
There is a price competition in the industry that is beneficial to customers, but it
is definitely negative for individual telecommunications entities. It led to the intro-
duction of unlimited services and subsequent reduction of unit prices. This results
in a deterioration in the profitability of the operation. The concentration on the cur-
rent competition for the client stopped the investments in modern infrastructure. In
the near future, tenders for telecommunications frequencies will be finalized, which
require significant financial outlays. The result is that the market environment will be
extremely demanding. In such conditions, building a competitive advantage can be
based on specialist knowledge and unique skills of employees (Lupicka et al. 2018;
Grzybowska and Lupicka 2017).
As an additional element shaping the telecommunications industry in Poland,
the concept of industry 4.0 should be indicated. The Fourth Industrial Revolution is
associated mainly with factories; however, it is a far broader notion, referring also
to other areas of organization activities, e.g., global supply chain management and
telecommunications. This concept goes beyond a single company and is carried over
to a network of links between organizations where data are integrated into a cloud
and processes are organized along a supply chain in virtual space (Szozda 2017).
Industry 4.0 technologies is an accelerator or catalyst that enables individualized
solutions, flexibility, and cost savings in industrial processes (Saturno et al. 2018).
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What is the main objective of the EcoProduction series?

What is the main objective of the EcoProduction series?

What topics does the EcoProduction series aim to cover?

What topics does the EcoProduction series aim to cover?

EcoProduction.

Environmental Issues in Logistics and Manufacturing

Environmental Issues in Logistics and Manufacturing

More information about this series at http://www.springer.com/series/10152

Anjali Awasthi Rapinder Sawhney

ISSN 2193-4614 ISSN 2193-4622 (electronic)

Poznan, Poland Katarzyna Grzybowska

Literature Review on Sustainable Logistics and Sustainable

Identiﬁcation of Logistics 4.0 Maturity Levels in Polish

Katarzyna Grzybowska and Anjali Awasthi

Abstract Sustainable Production and Sustainable Logistics has been discussed

Keywords Sustainability · Eco-logistics · Eco-production · Bibliometric

Dynamic development of manufacturing Industry 4.0 is inevitable. In a globalized

The study was financed by the research project no. 11/140/SBAD/4170.

© Springer Nature Switzerland AG 2020 1

Bibliometric analysis is a dynamically developing method of evaluating research

As a method of bibliometric analysis, the method of dynamic analysis of the literature

Table 1 Initial search results

Table 4 Most influential scientific papers

Fig. 2 Scientific productivity of researchers. Source Own study

Table 6 Most influential

Table 8 The most popular

Table 9 The most popular organizations for identified scientific papers

Fig. 3 Comparison of selected scientific centers. Source Own study

from these distinguished scientific centers published a total of 52 scientific papers,

The visualization of knowledge includes, among others, such issues as visualization

of information (Motylińska 2014). The visualization is to provide a more effective

Fig. 4 Keywords for activation period. Source Own study

3. expansion period (2016–2018).

5.1 Activation Period

5.2 Growth Period

Fig. 5 Keywords for growth period. Source Own study

5.3 Expansion Period

Table 10 Two important

the largest number of scientific publications on average. It should be noted that in

Fig. 6 Keywords for expansion period. Source Own study

Salvador MR, López-Martínez RE (2000) Cognitive structure of research: scientometric mapping

Rupinder Kaur, Anjali Awasthi and Katarzyna Grzybowska

Keywords Education · Competence · Skills analysis · Workforce planning ·

R. Kaur · A. Awasthi (B)

production, food processing, machine production, production of rubber and plas-

Benešová and Tupa (2017) recommend language skills, autonomy-responsibility-

Salah et al. (2019) emphasized on virtual reality based engineering education to

Table 1 Study results from

Table 2 Study results from

A questionnaire survey was conducted amongst 20 selected experts in the automo-

Fig. 1 Industry 4.0 competencies comparative analysis (Canadian sector)

Table 3 Study results from

Table 4 Study results from

Fig. 2 Industry 4.0 competencies (Polish sector)

6 Findings and Directions for Future Works

In this chapter, we conducted a detailed literature review on key competencies and

• Impact of various cultures on Industry 4.0 skills gaps.

Sandra Grabowska, Bożena Gajdzik and Sebastian Saniuk

S. Grabowska (B) · B. Gajdzik