What is Industry 4.0?

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industrial revolution

The first two industrial revolutions heralded a period of unprecedented technological, economic and social change, transforming Britain into the world's first modern industrial society. Many of us have lived and worked through the third one, which was powered by information technology. But now the winds of industrial change are blowing once again, as another revolution - Industry 4.0 - is set to change all our lives.  

What is Industry 4.0?

Industry 4.0 is not a new technology, nor a business discipline. It’s a new type of thinking that enables results that were simply not possible 10 years ago, thanks to advancements in technology. Anton Huber, CEO of Siemens Automation, sums up the philosophy behind Industry 4.0 as:
"Literally everything imaginable connected to a network so that information from all these connected 'things' can be stored, transferred, analysed and acted upon in new, and usually automated ways via network connections with everything else."
  As the fourth industrial revolution, Industry 4.0 signifies the move towards digitisation and involves three key parts:
  1. Internet of Things (IoT) and Cyber-physical Systems: for example, sensors having the ability to collect data that can be used by manufacturers and producers
  2. Big Data and Powerful Analytics Tools: for example, systems can trawl through huge sets of data and produce insights that can be acted on quickly or even in real-time
  3. Communications Infrastructure that is secure enough to be used by heavy industries
From Industry 1.0 to Industry 4.0
From Industry 1.0 to Industry 4.0 | Engineers Journal
  Industry 4.0 introduces networked production powered by intelligent machines and real-time data, providing the conditions for processes that are more accurate and cost-effective. At the heart of Industry 4.0 are smart factories, which use information and communication technology to realise a much higher level of both automation and digitisation, thereby driving the evolution of supply chains and production lines. With self-optimisation, self-configuration and even artificial intelligence technology, intelligent machines are able to complete complex tasks in order to deliver vastly superior cost efficiencies and higher quality goods or services. Whatever your company produces - whether it’s food products, consumer packaged goods or aeroplanes - Industry 4.0 signals the arrival of technology that will enable you to mass customise products at greater speed and scale.  

But what exactly do manufacturers mean when using the term Industry 4.0?

Industry 4.0 has become the collective term for the concepts and technologies needed to achieve a networked production process. It can best be explained by one central concept and five technologies that bring it to life.   Industry 4.0

The Concept

The internet enriched many lives and changed the way whole industries work by creating a digital interface that connects people to the digital world. The Internet of Things (IoT) is the next stage of connection where every physical object can be permanently connected to any database via a network of technologies. IoT is a concept where physical objects or 'things' have built-in technology that transfers and exchanges data over a network without human interaction. At its most basic level, this could simply be a sensor in your car connecting to a central transmitter to send data to your smartphone; which is nothing new. What makes the IoT a potential life-changing concept is how the networked data is shared and used. For example, agencies may get real-time data to monitor and analyse traffic, your insurance company could use it to set your annual premiums and road repair mechanics can use the data to prioritise their workload. The Industrial Internet of Things (IIoT) draws on the IoT concept and applies it specifically to the manufacturing process. IIOT takes the form of networked system of machines, sensors and software designed to collect, analyse and use data in real time to self-diagnose, repair and optimise the production process.  

The Five Technologies

1. Cloud Integration

Cloud Integration is the complex task of connecting, storing and using the data of every moving part in a business through a universal software service stored in a secure virtual network of servers (otherwise known as a cloud).

2. Big Data

Big Data is the buzzword of the moment and it refers to complex data sets that are too large for our current software services to capture, analyse and make meaningful conclusions from.

3. 3D Printing

3D Printing or Additive Manufacturing is a process that starts with a computer aided design (CAD) and builds up layers of material into a solid three dimensional object.

4. Autonomous Robots

An Autonomous Robot is a machine than can move, perform tasks and maintain itself without direct human interaction.

5. Augmented Reality

Where Virtual Reality shows users a simulated world, Augmented Reality is a real-time simulation of a real world environment enhanced by computer aided sounds, videos and graphics  

Watch a one minute short video of Frank Piller, Professor of Innovation at RWTH Aachen, Co-Director of MIT Smart Customisation Group and Innovation Management leader at The Leadership Network, talk about what Industry 4.0 means for you.


When will Industry 4.0 start to impact on my business?

Industry 4.0 was first mentioned in a German government memo in 2013 and, despite being a relatively nascent concept, is now at the heart of the strategic and research agenda for many companies in 2016/17. However, many of the technologies considered as part of Industry 4.0 are already in use by manufacturers, such as major steel producers Salzgitter whose CEO, Heinz Jörg Fuhrmann, who says, "We may not have known it was called Industry 4.0, but we've been doing it for years." In a 2015 survey from PwC, just over two-fifths of companies report that they believe their product development and engineering and their vertical value chains are already benefiting from an advanced level of digitisation and integration. The report also found that ‘First movers’ are almost three times more successful in combining high revenue increases with significant gains in cost reduction.
% of companies achieving >30% increased revenue and >30% reduced costs simultaneously by 2020 | Industry 4.0: Building the Digital Enterprise - PwC
Industry 4.0: Building the Digital Enterprise, PwC
Of course, many of the technologies that are considered part of Industry 4.0 were already in use by manufacturers, such as major steel producers Salzgitter. Their CEO, Heinz Jörg Fuhrmann, says:
"We may not have known it was called Industry 4.0, but we've been doing it for years."
Whether your business has experimented with these technologies already, or not, what’s clear is the ‘first mover’ organisations will outpace their competition and those who fail to adapt will fall flat. According to the Executive Chairman of Bosch, Siegfried Dais: “It is highly likely that the world of production will become more and more networked until everything is interlinked with everything else.”  

What does this practically mean for manufacturers?

For IoT to become a reality; data and processes from all machines need to connect to every moving part of business through a networked system stored on a secured cloud. This means that companies will be able to collect, analyse and use big data across multiple sites without any physical barriers such as travel distances and time. For example, workers can use augmented reality technologies to experience future scenarios before they happen and make better real-time engineering and commercial decisions. Autonomous robots connected to this network can then use the data to perform tasks, assemble products and even 3D print parts to reduce transportation distances and lower costs for raw materials. With IoT, companies can develop a truly automated value chain, which can produce defect-free and mass customised products both faster and cheaper. EMAIL-BANNER-BMW
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