What is Industry 4.0 and how will it influence businesses in the future?

Machines that predict when they need servicing, production lines connected to real-time demand, workers with sensors to detect accidents instantly… Sounds like the future, but it’s not. It’s Industry 4.0.

Automated and interconnected processes

What is Industry 4.0?

Industry 4.0 refers to the fourth wave of the industrial revolution, a disruption comparable to the adoption of steam in the first industrial revolution, electricity and mass production in the second, or computing and automation in the third. 

In this new wave, digitalization and a large number of disruptive technologies are making their entrance: robotics, artificial intelligence, big data and data analysis, the Internet of Things, cognitive technologies or virtual reality.

Thanks to all these technologies, we can design intelligent factories where the entire workflow is not only automated, but also interconnected with external players, such as points of sale. In this way, an information network is generated that allows flexible and efficient manufacturing methods.

Some examples and uses of Industry 4.0

Thanks to Industry 4.0, production in Spain and in the world is changing noticeably. Here are a few examples of what goes on in intelligent factories:

  • Automatic product traceability. Thanks to the implementation of tracking technologies, companies can see where the raw materials they need are at all times, or even their product once it has been completed: whether it is in the production chain, in transport, at the point of sale or whether it has already been purchased. This information allowsoperators to make better decisions and balance production according to changing demand.
  • Task automation: in the production line, the product can be equipped with intelligent labels so that the machines can autonomously “read” which operations have already been performed and which are necessary. 
  • Location and identification of staff. Knowing at all times where the employees are, for example, by means of wearable technology, allows us to know the resource needs, as well as to detect if an accident occurs, facilitating an early response.
  • Predictive maintenance: From the data generated by the monitoring of machines and using techniques based on Big Data and ‘machine learning’, it is possible to predict when a breakdown will occur in a certain element of the production chain so it can be replaced before it happens.

All of these elements contribute to increased productivity as well as significant cost savings.

The situation in Spain

In Spain we already have large companies that are putting their money on Industry 4.0, but there is still work to be done. According to a study by the consulting firm PwC, 32% of Spanish industrial companies are in an advanced stage of digitalization, while 68% are in a medium or low stage, so there is still work to be done. The government itself has a plan in place to help companies continue to advance in digitalization with a website where information on the various announcements, guides and even a self-diagnostic tool can be found.

Among the barriers that companies face are identity management and device verification, network security or regulatory compliance, and attracting qualified talent who are experts in the various technological areas involved.

However, the study also reveals that most companies are aware of the benefits of industry 4.0 and want to continue to make progress in this area. Among the benefits they foresee are increasing their revenues by 11.1% on average and reducing their costs by 19.4% as a result of digitalization.

Advantages of Industry 4.0

The Industry 4.0 revolution and the consequent increase in flexibility is transforming industry in terms of safety, quality, productivity, management capacity, economic growth and employment, as well as increasing user satisfaction and loyalty. In short, Industry 4.0 provides competitive advantages over rivals, improving agility and the ability to react to any change in the market.