The 4th Industrial Revolution and Why It Matters
Most textbooks talk about one industrial revolution, but we’ve actually been through three already. Now the fourth one is here. Read on to find out what the fourth industrial revolution is and why it matters.
What is Industry 4.0?
The fourth industrial revolution, also known as Industry 4.0, builds on three previous leaps in manufacturing. The first Industrial Revolution gave us water and steam power, the second brought electricity, and the third created computers.
According to German engineer and economist Klaus Schwab, the fourth industrial revolution will bring us smart factories. These are manufacturing sites where data exchange and internet-connected manufacturing equipment combine to create a new form of automation. Smart factories are made possible by the Internet of Things. People, machines and data communicate back and forth, all the time, to make the best production decisions.
In a smart factory, data and machines make decisions just like technicians or managers. For example, an algorithm might use data to decide that tomorrow offers ideal conditions for equipment maintenance, then query the production machines to see where to schedule repairs first. Or, a machine might decide that it needs maintenance, then study the upcoming work schedules and plan the maintenance downtime at the most cost-effective time.
Industry 4.0 Design Principles
Smart factories are being created based on a shared set of design principles:
- Interoperability: People, plant, and equipment must share data in all directions
- Virtualization: Virtual copies of physical sites create value by linking real-world sensor data with computerized models
- Decentralization: Equipment can make decisions on its own
- Real-time Capability: Data collection, analysis, and interpretation must happen 24/7
- Service Orientation: Real-time production capacity should be shared online through the Internet of Services
- Modularity: When production requirements change, smart factories should adapt by replacing or expanding pieces of the production process
Why Industry 4.0 Matters
Computing (Industry 3.0) enabled real-time global collaboration. Work didn’t have to happen in a single place—you could connect a designer in New York, a parts supplier in Germany, and a factory in Korea. Industry 4.0 creates a similar distributed production process, but enriches it in new ways.
Automated Site Selection
The factory from the above example might have identical locations Brazil and Pennsylvania. As customer orders come in, a highly connected production system can decide which orders to route to Korea, Brazil, or Pennsylvania depending on a long list of variables. Or, the factories in all three locations could work together as a single “factory,” each making part of a finished product, as directed by insights from data.
Automated Cost Optimization
Now let’s zoom in and look at another example. Because of Industry 4.0, two similar factories in North Carolina offer real-time feeds of their production capacities and manufacturing costs. Parts are in production at Factory A. If capacity opens up unexpectedly at Factory B, and production will be less expensive there, some or all of the job from Factory A can be instantly shifted to Factory B. Factory A might even sense the extra capacity on the market, and instantly lower its production price to keep the business.
Automated Production Matchmaking
It will become much easier for manufacturers to get the best production available, at the best price. In the past, when manufacturers managed their own production site, they were constrained by geography, local regulations, power sources, workforce, weather, distribution networks — so many factors beyond what they could control under their roof.
Now, with Industry 4.0, manufacturers can match up with trusted partners whose production equation dovetails with their product demands. And when the production equation changes, it will be known in real time and production can shift to a new site. At the same time, that capacity shift will make the original manufacturing site a better choice for somebody else. A new match will be made and production will begin on a new project.
Similarly, if product demands change, work can be instantly transferred to a site that’s a better fit for making the new product.
People Still Matter
Industry 4.0 also brings one big benefit for relationship-focused designers and manufacturers: we are already beginning to see more engineers and manufacturers from Philadelphia and New York City, utilizing our central location in the Lehigh Valley. Not everybody’s manufacturing plan calls for shifting production around the globe at a moment’s notice. Many people still prioritize trust, dependability, skill, and face-to-face relationships over anonymous decentralized production.
Manufacturing partners like ProtoCAM will be able to publish these capabilities to the Internet of Services, based on Principle 5, “Service Orientation.” Algorithms that prioritize expertise and relationships will automatically match designers with service-oriented manufacturing partners.