Industry 4.0 – The Factory of the Future

What is Industry 4.0?

In recent years technological innovation has given us access to products that previous generations would’ve considered impossible fantasies. Computers, smart phones, GPS, the internet, and streaming online media are all recent technological breakthroughs made possible through advances in the digital sphere. Now, technological innovation is making its way to the factory floor in what has been coined Industry 4.0 or the fourth industrial revolution. Industry 4.0 has been hailed as the integration of physical, digital, and biological domains, utilizing technology to make labor and production more efficient.

The first industrial revolution was the introduction of machines into the factory, which lead to a dramatic increase in the level of output as manufacturing transitioned from a product being produced completely by hand to being mass produced by machines. The second industrial revolution was sparked by the introduction of electricity and the assembly line whereby workers specialized in doing a specific task and completed it over and over. The second industrial revolution began in the early 20th century and lasted until the 1970s whereby the introduction of semiconductors and computers enabled the creation of sophisticated manufacturing and supply chain systems, ushering further gains in output during the third industrial revolution. Industry 4.0, or the fourth industrial revolution, is distinguishable from the third industrial revolution with the introduction of cyber-physical systems that are communicating and making autonomous decisions with other machines and the rest of the digital supply chain.

The common precursor to each industrial revolution was the onset of new technology. The steam engine, electricity, computers and finally Industry 4.0 is being ushered in with several ground-breaking technologies that have already started to prove themselves in other domains, but are now finding their way into the factory of the future.

Key Technologies of Industry 4.0

Industry 4.0 will be brought on by several technologies, interfacing and working together to improve factory efficiencies. The top 9 technologies leading the way for the fourth industrial revolution are:

Internet of Things

Factory machines and sensors will become connected through IOT and given the ability to collect, organize and store data. IOT will be critical for remote monitoring and control, yield optimization, job routing, and predicative maintenance of equipment.

Big Data and Analytics

A key tenant of Industry 4.0 is the introduction of sensors on every piece of equipment in the factory to constantly track real-time data. IOT allows the collection of vast amounts of data while the concept of big data and analytics is the ability to store, interpret and make decisions off this data. Many decisions could even become automated.


Automation of course is the introduction off software and robots to conduct repetitive and/or dangerous jobs currently done by humans. Much of the public remains uneasy at the prospect of massive job displacement because of automation, however, automation also offers many benefits to workers. Dangerous jobs with high rates of injury or ones requiring repetitive motion can be done by robots, while humans are moved to jobs that require more creativity and dexterity.

Advanced Robotics

Collaborative robotics is the idea that robots will be used alongside humans to assist with technical operations. Rather than working autonomously, collaborative robots work alongside humans and provide complementary skillsets.

In addition to collaborative robotics, smart robots utilize artificial intelligence and big data to make decisions and operate fully autonomously. Each production system is different and will therefore require different operations and varying levels of collaborative and autonomous robotics, each providing their own niche of capabilities.

Cloud Computing & 5G

As factories become more computerized and machines gain more connectivity, cloud computing will play an increasingly important role in providing the computing power necessary for entire supply chains. 5G communication will need to work together with cloud computing as machines will need to react to sensor inputs in a fraction of a second. Data will be collected, transmitted, processed with a decision, and transmitted back to the machine to execute.

Artificial Intelligence

Artificial intelligence and machine learning will be at the heart of the fully autonomous systems that will be a defining characteristic of Industry 4.0. The systems need to be able to make their own decisions autonomously based off the data gained from the machine’s sensors on the factor floor. The automation of routine decisions can free up worker’s time for more productive and creative opportunities.

Augmented Reality

Augmented reality, using special glasses and headsets, can usher in a new era for assembly and inspection. AR technology can identify the object in front of a worker and pull up the product’s schematics and allow the worker to see the schematics on the product while working.

Additive Manufacturing

Additive manufacturing, otherwise known as 3D printing, is the mechanism that transfers the digital to the physical. Digital instructions can be created using a CAD design software and then manufactured on-demand. Most 3D printers already have many Industry 4.0 capabilities including remote monitoring and control and fully autonomous build processes.

These 9 technologies will be both the defining characteristics of the 4th industrial revolution and its driving forces that will enable it to be possible. Without the advancement of these technologies, improvement in the factory will also plateau.

Design Principles of Industry 4.0

There are four design principles of industry 4.0 that bring together the 9 technologies into cohesive groups that can collaborate to improve industrial efficiency.


Interconnection is the principle that draws upon the technologies of IOT, cloud computing and 5G. It is a key principle of industry 4.0 as it allows entire supply chains to become interconnected which enables firms to optimize supply and demand, batch sizes, and routing to name a few. Jobs can be queued up and sent to a 3D printer to be manufactured on-demand. Real-time data from the remote-monitoring system on the machine can be transmitted across the 5G network to track progress and anticipate where to send the next job.

Information Transparency

What was once difficult or expensive to track is now readily available for workers to make decisions. More data and better analytical tools paint a clearer picture of the production system with more insights on possible improvements. Vast amounts of data can be collected and analyzed to achieve potential savings that would never have been identified without the data. As sensors attached to factory machines and robots collect data, big data analysis can efficiently process and act on it through technologies such as augmented reality which can display instructions for workers.

Technical Assistance

Technical assistance is providing humans with support to achieve a level of perfection that would otherwise be impossible. Collaborative robots, augmented reality and 3D printing all dramatically increase worker productivity. Robots can help humans perform highly intricate work that neither a robot or human alone could achieve while working independently. Likewise, AR can assist workers in locating various product features during fabrication operations, increasing throughput and first-time quality.

Decentralized Decisions

Robots, automation, artificial intelligence, and 3D printing can each collaborate and operate apart from a centralized production system and be placed closer to the customer. Rather than centralizing production, the factory of the future could be a network of service centers whereby orders enter a queue and are automatically routed to a 3D printer. An artificial intelligence system can make decisions such as how to batch and queue orders to maximize efficiency. Even at the work station level, individual machines can be armed with the capabilities to make decisions autonomously without human intervention.

Value Drivers

Although the technologies and design principles will help supply the solutions to unlocking the efficiencies contained in the factory of the future, market value drivers are what will ultimately lead to adoption. In other words, all these technological innovations still must create significant value.

Faster Time to Market

Increased ability to rapidly experiment with product ideas and perform simulations will allow companies to cut time and cost out of the new product development process. Technologies like 3D printing can produce concept models and functional prototypes in a matter of hours, dramatically reducing flow times between product iterations. Product developers can work more closely with their customers and design right-fit customized solutions that otherwise wouldn’t be possible without Industry 4.0 technology.

Lower Inventories

Supply/demand optimization, batch sizing and other benefits made possible using 3D printing and artificial intelligence systems can decrease the amount of idle WIP inventory in the production system. More accurate forecasts can be produced with big data analysis and 3D printers can manufacture products on-demand according to routing and production systems optimized by AI.

Increased Labor Efficiencies

Human-robot collaboration and remote-monitoring systems will increase the efficiencies of each worker. Rather than having to be located near a machine to monitor its progress, remote monitoring systems allow operators to be off-site but still able to virtually control the machines. This could allow a single worker to monitor a higher number of machines than before, increasing the productivity of each individual worker. Likewise, human-robot collaboration can drive efficiencies related to making humans more accurate and safer when performing their jobs.

Better Asset Utilization

IOT, 5G, and cloud computing will be critical in allowing companies to optimize their machine utilization through better routing and machine flexibility. Remote monitoring and control will again allow workers to continue to monitor machines even when offsite while predictive maintenance will allow firms to discover issues with their equipment before it breaks down and affects production.

The Factory of the Future

While it is still up for speculation on what exactly the factory of the future will look like, it is certain that industry 4.0 will dramatically change the factory forever. From the first industrial revolution to the invention of the steam engine, electricity, and the semiconductor. Industrial progress has always required advances in technology to facilitate innovation in the factory. However, to be implemented, the technology must present a business case to firms in which the process efficiencies gained outweigh the cost to implement and maintain them.

Have thoughts about Industry 4.0 or any of the technologies in the factory of the future? Leave a comment and join the discussion below!

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