The term Industry 4.0 (“Industrie 4.0”) first appeared in a German government memo. In its earliest usage, Industry 4.0 referred to Germany’s attempts to integrate digital technologies into its national manufacturing strategy.
The term quickly caught hold. “Industry 4.0” became common parlance in manufacturing communities by the early 2010s.
Writing in 2014 of a rapidly changing business landscape, head of the World Economic Forum Klaus Schwab summarized the developments he considered essential to the recently named Industry 4.0:
Industry 4.0 is the fusion of these technologies [AI, big data, IoT, bioinformatics] and their interaction across the physical, digital, and biological domains that make the Fourth Industrial Revolution fundamentally different from previous revolutions — diffusing faster and more broadly than any of the previous revolutions.
What makes Schwab’s definition so compelling is his identification of the scope and the reach of Industry 4.0. Industry 4.0 for Schwab is not strictly technological. It is a new way of connecting and communicating that links digital technology to the human body and physical objects.
Though Schwab’s definition is hard to beat for concision and accuracy, a short review of different definitions can go a long way toward highlighting what is significant about Industry 4.0.
Perhaps because of the complexity of the era, Industry 4.0 has been defined in a number of ways. While the emphasis in each definition may differ, there is broad consensus that Industry 4.0 is characterized by:
- A suite of digital technologies achieving scalability and ROI in industrial contexts
- A changing relationship between humans, machines, and labor
- A dispersion and pace sufficient to earn the title “revolution”
Further, commentators agree on three main drivers of Industry 4.0 in manufacturing:
- Simultaneous maturation of old and new technologies
- A convergence of use-cases in manufacturing
- Increasingly wide-spread adoption at scale
Key drivers of Industry 4.0 in 2020.
Industry 4.0 Technology as a Driver of Change
Many definitions of Industry 4.0 privilege specific technological advancements. In these definitions, the authors point to the emergence of business use-cases for technologies such as artificial intelligence, big data, Internet of Things integration, ubiquitous internet connectivity, 3D printing, and cyber-physical systems.
Many of these technologies are not new. Their costs, however, have decreased dramatically in the last decade, and their capabilities have increased proportionally. For example, advances in cloud architecture make it possible to collect and store data in previously unimaginable quantities, while the affordable cost of cloud solutions now makes it possible for businesses to use the technology at scale.
For some, Industry 4.0 is characterized by the convergence of many technologies into responsive technological ecosystems. Here, the fact that Industry 4.0 technologies enhance, enable, and augment each other as systems makes it worthy of the name.
Industry 4.0 as Changes in the Nature of Human and Machine Work
Several commentators have argued that Industry 4.0 is best understood as a change in the relationship between technology and work more broadly. Here, advanced technologies usher in a new era because they fundamentally change relationships between workers and machines on the factory floor.
For one management scientist, Industry 4.0 “assumes a blurring [of] the differences between the work of people and the work of machines.”
This is true. But what does it mean?
For much of the history of manufacturing, work was either performed by a human or a machine. While there was always some grey area in this distinction–How do we categorize operators of machines? The engineers who program machines? What constitutes “work”?–under Industry 4.0, the division of labor became murkier.
The modern factory relies on increasingly complex relays between humans and machines, with cognition and problem solving as well as assembly and processing distributed between the two.
Deloitte has described these relays between humans and machines as a “physical-to-digital-to-physical (PDP) loop.” For these analysts, the interdependence of human and machine labor across digital and physical spaces is the defining feature of Industry 4.0. “It is the leap from digital back to physical,” they write, “the ability to act upon data and information that has been analyzed–that constitutes the essence and value of Industry 4.0.” [Deloitte graphic]
Industry 4.0–Worklife Resembles Private Life
There are some for whom Industry 4.0 means something totally different. For Dan Ron, a process engineer at Dentsply Sirona, Industry 4.0 is about “leading a work life that is similar to our personal life.”
By this, Ron means that we have accepted the presence and utility of digital tools in our daily lives. We go about our days with devices to aid us, apps to supplement us, and ubiquitous internet to connect us–for better or worse.
This is not the case in manufacturing. Many factories still run on analog technologies, the consumer equivalents of which have long receded into irrelevance (almanacs, cassettes, paper records). Until now, these technologies worked, and alternatives were prohibitively expensive for all but the best-funded organizations.
For Ron and others, Industry 4.0 is an opportunity to take the best developments from our personal lives and apply them to manufacturing contexts.