What is Industry 4.0 all about?

There is a lot of buzz about Industry 4.0, also known as the fourth industrial revolution (or 4IR).

But what is the fuss all about?

All of us are aware of the pace of technological development in recent times, thing like:

  • 3D CAD, Virtual Reality, Augmented Reality and Mixed Reality Systems like Microsoft Hololens, Oculus Rift, Google glass etc. These systems enable us to replicate things and ideas virtually before spending money to build those things or explore those ideas in tangible forms. For example, warehouses can be built and reviewed substantially including walk-throughs into the warehouse without building anything;
  • Internet of Things – IoT, i.e. anything that is connected to the internet, things like your phones, laptops, ‘Ring’ doorbell, new generation fridges and cars etc;
  • Radio Frequency Identification – RFID, the sort of technology used in contactless payments, access cards, toll booth remote payments etc.
  • Cloud Technologies that power not only your iCloud, Google Drive, OneDrive, Dropbox etc. but also a range of apps on your mobile devices, and the video call platforms (Zoom, Skype etc.) and the movie platforms that have become highly relevant during this COVID-19 pandemic (Netflix, Prime Video, Now TV etc.);
  • Big Data and Business Intelligence that enable us to make more sense of huge volumes of data that we are all contributing to create at very fast pace, including the Artificial Intelligence (AI) technologies behind them;
  • Nanotechnology that means that our gadgets are packing in more power while getting smaller;
  • Robotics that now enable most operations to become more and more automatic and faster;
  • Drones and self-driving vehicles which are already affecting the conventional ways of doing things from delivery drones and surveillance drones to drones for festivities like the New Year drone performances in several countries;
  • E-commerce which has taken a prime position during this COVID-19 pandemic;
  • Cyber security systems that are helping to protect us from cyber attacks;
  • 3D-printing which is no longer a hobby technology nor just for prototyping but can now be used to print final products in various materials including metals;
  • Blockchain technology that helps to ensure that information cannot be tampered with unscrupulously once they are recorded;
  • etc.

These technologies are seen as cutting-edge and disruptive because they have the potential to transform how value is created and delivered, and how companies compete. It is fair to say that they do not just have the transformational potential but they are already transforming the way things are done as the examples above suggest. So the fuss is about these technologies and what they can be used for now and in the future.

But why call this transformation an ‘Industrial Revolution’?

The phrase “the fourth industrial revolution” is meant to highlight the significance of this transformational capability of these technologies in comparison to the previous industrial revolutions where:

  • the first industrial revolution of 1760-1860 introduced the steam engine that facilitated the mechanisation of production (Clarke 2005);
  • the second industrial revolution of 1870-1914 was characterized by huge economies of scale in manufacturing i.e. mass production which was supported by developments around electric power, railways etc. (Mokyr and Strotz 1998);
  • the third industrial revolution of the 1980s is characterized by the growth of electronics and Internet and Communications Technology (ICT) that facilitated various types of automation (Gray, 1984; Fitzsimmons, 1994).

As a mainstream proposition, the fourth industrial revolution, was coined by Klaus Schwab, the founder of the World Economic Forum (WEF), in his book entitled… guess what?…“The Fourth Industrial Revolution”. This and the activities of the WEF helped to spur interest in the area and currently the topic has gained global significance.

References

Clark, G. (2005) ‘The British Industrial Revolution, 1760-1780’, World Economic History, ECN 110B.

Fitzsimmons, J. (1994) “Information technology and the third industrial revolution”, The Electronic Library, Vol. 12 No.5, pp.295-29.

Gray, H. J. (1984) ‘The New Technologies: An Industrial Revolution’, Journal of Business Strategy, Vol. 5 No.2, pp.83-85

Mokyr, J and Strotz, R. (1998) ‘The Second Industrial Revolution, 1870-1914’, Northwestern University Web site, available at: http://faculty.wcas.northwestern.edu/~jmokyr/castronovo.pdf. Accessed September 7, 2018.

Schwab, K. (2016) ‘The Fourth Industrial Revolution’ World Economic Forum.