What is Industry 4.0?

cbeecher Artificial Intelligence

Industry 4.0








Industrialization has seen revolution after revolutions in every decade since its evolution in the 18th century. From the advent of steam power inventions to the introduction of electricity a century later, to the third industrial revolution in the 1970’s with the advances in computing, till today where Industry 4.0 has brought in the fourth Industrial Revolution that is transforming the economy, jobs, and society.


  • The term Industry 4.0 was first publicly introduced in 2011 as “Industry 4.0” under an initiative to enhance the German competitiveness in the manufacturing industry.
  • Industry 4.0 is all about doing things differently — introducing automation and data exchange in manufacturing technologies.
  • New Industry 4.0 technologies, spanning mobile computing to cloud computing, have undergone vast development in the last decade and are now ready to be used as commercially available, interconnected systems within manufacturing – this is Industry 4.0. It includes cyber-physical systems, the Internet of Things, and cloud computing.
  • Industry 4.0 is the evolution to cyber-physical systems, representing the fourth industrial revolution on the road to an end-to-end value chain with Industrial IoT and decentralized intelligence in manufacturing.
  • A combination of cyber-physical systems, the Internet of Things and the Internet of Systems make Industry 4.0 possible and the smart factory a reality.
  • Ultimately, it’s the network of these machines that are digitally connected with one another and create and share information that results in the true power of Industry 4.0.


Evolution of Industry from 1.0 to 4.0

There are four distinct industrial revolutions that the world either has experienced.


  1. The First Industrial Revolution, or Industry 1.0:


The first industrial revolution happened between the late 1700s and early 1800s. This included going from manual production to the use of steam-powered engines and water as a source of power. This made agriculture more popular and factory became more trending word.


  1. The Second Industrial Revolution, or Industry 2.0:


In the early part of the 20th century, the introduction of electricity enabled manufacturers to increase efficiency and helped make factory machinery more mobile. It was during this phase that mass production concepts like the assembly line were introduced as a way to boost productivity. Introduced pre-existing systems such as telegraphs and railroads into industries.


  1. The Third Industrial Revolution, or Industry 3.0:


Starting in the late 1950s, the third revolution was, and still is, a direct result of the huge development in computers and information and communication technology. During this period, manufacturers began experiencing a shift that put less emphasis on analogue and mechanical technology and more on digital technology and automation software.


  1. The Fourth Industrial Revolution, or Industry 4.0:


Industry 4.0 refers to a new phase in the Industrial Revolution that focuses heavily on interconnectivity, automation, machine learning, and real-time data. Industry 4.0, also sometimes referred to as IIoT or smart manufacturing, marries physical production and operations with smart digital technology, machine learning, and big data to create a more holistic and better-connected ecosystem for companies that focus on manufacturing and supply chain management.


Terms in Industry 4.0:


There are hundreds of concepts and terms that relate to IIoT and Industry 4.0, but here are some of important words and phrases to know before you decide whether you want to invest in Industry 4.0 solutions for your business:

IoT: The Internet of things is the networking and control of digital solutions and various products directly via the Internet. This is already partially established today but will continue to grow significantly in the context of Industry 4.0.

M2M: This stands for machine-to-machine and refers to the communication that happens between two separate machines through wireless or wired networks.

Digitization: Digitization refers to the process of collecting and converting different types of information into a digital format.

Physical to digital: Capture information from the physical world and create a digital record from physical data

Digital to digital: Share information and uncover meaningful insights using advanced analytics, scenario analysis, and artificial intelligence

Digital to physical: Apply algorithms to translate digital-world decisions to effective data, to spur action and change in the physical world

Enterprise Resource Planning (ERP): Business process management tools that can be used to manage information across an organization.

IIoT: IIoT stands for the Industrial Internet of Things, a concept that refers to the connections between people, data, and machines as they relate to manufacturing.

Big Data: Big Data will be another central point in the area of Industry 4.0. Thanks to newer and faster systems and artificial intelligence and algorithms, data will hardly be accessible to humans.

Machine Learning: Machine learning refers to the ability that computers have to learn and improve on their own through artificial intelligence—without being explicitly told or programmed to do so.

Artificial intelligence (AI): Artificial intelligence is a concept that refers to a computer’s ability to perform tasks and make decisions that would historically require some level of human intelligence.

Smart factory: A smart factory is one that invests in and leverages Industry 4.0 technology, solutions, and approaches.

Cloud computing: Cloud computing is already being used successfully in many companies and offers the possibility of using many services independently and flexibly.

Real-time data processing: Real-time data processing refers to the abilities of computer systems and machines to continuously and automatically process data and provide real-time or near-time outputs and insights.

Ecosystem: An ecosystem, in terms of manufacturing, refers to the potential connectedness of your entire operation—inventory and planning, financials, customer relationships, supply chain management, and manufacturing execution.

Cyber-physical systems (CPS): Cyber-physical systems, also sometimes known as cyber manufacturing, refers to an Industry 4.0-enabled manufacturing environment that offers real-time data collection, analysis, and transparency across every aspect of a manufacturing operation.


Who Is Industry 4.0 Right For?

  • Competitive industry with a lot of tech-savvy players
  • Identify and address issues before they become bigger problems
  • Boost efficiency and profitability across your entire organization
  • Difficult to fill vacant jobs at your organization
  • Better visibility across your supply chain
  • Digitizing and making use of information using historical and real time data
  • Informed, up-to-date, relevant views of production and business processes
  • Looking for more and deeper analytics for your business growth
  • You want real-time insights that help you make better, faster decisions about your business each day
  • Improve product quality, customer satisfaction and customer experience
  • Industry 4.0 touches everything in our daily lives
  • Industry 4.0 integrates the digital and physical worlds
  • Rapidly evolving technological capabilities


Advantages of Industry 4.0:

  • Efficiency
  • Agility
  • Innovation
  • Customer Experience
  • Costs
  • Revenues
  • Scalability
  • Security and Redundancy
  • Control and Visibility


Implementation Challenges for Industry 4.0:

  • IT security issues
  • Reliability and Stability needed for critical M2M communication
  • Maintaining the integrity of the production process
  • Avoid expensive production outrage (IT)
  • Lack of sufficient skill sets
  • Lack of regulation, standard and forms of certification
  • Loss of manual jobs to the process of automation


In short, organizations should consider taking a holistic view of the Fourth Industrial Revolution and the ways in which it changes business. Industry 4.0 is about more than just advanced technologies: It is about the ways in which those technologies are brought together, and how organizations can harness them to drive operations and growth. Industry 4.0 can feel difficult, if not impossible, to wrap one’s arms around. Customer experience in the age of Industry 4.0 would be driven not just by the physical object but by the information, analytics, and customization that make the customer’s interaction with that object more transparent, and the ways the company takes action on the insights they gather. Industry 4.0 likely means different things for different individuals. For employees, Industry 4.0 could signify a shift in the work they are expected to do, and how they are expected to do it.


By Staff Writer, Trumble Inc.

May 7, 2020