Industry 4.0 and Your Business

How Industry 4.0 has changed the direction of the market.

Industry 4.0, also known as the Fourth Industrial Revolution, is the next step in manufacturing. It introduces technology that digitizes decision-making, increases human-technology interaction, increases data and analytics access, and automates production. This article will help explain what’s going on in this new level of industrial revolution and how your business can benefit from it.

The Stages of Industrial Revolution

Over time, society has gone through a few stages in the industrial revolution. These steps have been:

- First Industrial Revolution

Progression from manual production to machine-led production using steam and waterpower.

- Second Industrial Revolution

Introduced and standardized electrical power and mass assembly production.

- Third Industrial Revolution

Introduced limited use of automation using computers and the beginning of introducing robots into many parts of production.

- Fourth Industrial Revolution

Machine learning, AI, cloud computing, and analytics are applied to create near-autonomous operations.

What is Industry 4.0 changing?

Industry 4.0 is taking aspects of what the third industrial revolution gave us and improving upon them. In doing so, it has given us things like:

Cyber-security - The ability to protect networks, devices, and data from unauthorized access and criminal use.

• Virtual reality - professionally, virtual reality can be used for more impactful meetings, sales presentations, and training.

• Autonomous robots - Allows technology to be automated in precise actions and tasks to help speed up production.

• Simulations- Simulations can be used to test products, production, skills, and risk assessment in order to help with decision-making and optimization.

• Big data and AI analytics- Allowing businesses to have access to data and analytics to help fuel their decision-making and provide insight into the market and algorithm online.

• Horizontal and vertical integration- Horizontal integration refers to the digital flow of data across the entire value chain, from design to production to service and recycling. Vertical Integration refers to the convergence of data and analytics from the shop floor to the top floor to help with data-driven decision-making.

• Industrial Internet of Things - IoT refers to the interconnected systems of devices and applications used to enhance production and industrial processes.

Digital Twins - This approach allows for constant optimization throughout product and production lifecycles. This allows for faster production, data-driven performance optimization, and flexible manufacturing.

How is the market changing?

The market is, in some ways, getting a complete overhaul. Businesses have access to information and technologies they didn’t have before, and it’s doing so fast. Certain operations seem almost unrecognizable from what they looked like just 10 years ago when Industry 4.0 was in its early stages. This can seem daunting to business owners who may feel like they’re drowning in the influx of technology and information they suddenly have access to. The workforce will also go through some significant changes as things progress.

• The demand for technological skills is predicted to rise by more than 50% due to increasing technology usage.

• Due to automation, the demand for manual and physical skills, such as those on assembly lines, is predicted to decline by almost 30%.

• The demand for basic literacy and numeracy skills is predicted to decline by almost 29% due to technology being adopted where those skills were needed.

As a business owner, these changes mean you will have to adapt. As an example of the adaptations needed from businesses, it’s predicted that the front-runners of Industry 4.0 will see a 122% positive cash flow change from integrating AI and other advanced technologies by 2025, while businesses that fail to do the same could possibly see a 23% downturn.

Upskilling and Reskilling to Adapt

As businesses' needs change, upskilling and reskilling to meet those needs is important. Upskilling means learning new skills to help better perform current tasks. Reskilling is where you learn new skills that enable you to perform different jobs, such as what Industry 4.0 brings into the economy. As a business owner, it is important to search for talent to fit the changing needs and adapt yourself as well. 50% of the workforce will need reskilling and upskilling to adapt to the new technology that Industry 4.0 is bringing us.

Without the skills needed to properly handle the technology we have access to today, a business can risk falling behind and going out of business due to its inability to keep up with everyone else. As an example, companies that were already integrating Industry 4.0 technologies before COVID-19 were in a much better position to handle the changes the pandemic brought on for businesses compared to businesses that didn’t. Industry 4.0 is bringing immense change to how businesses function, and it can be an exciting and prosperous venture for businesses that integrate the technologies available to them.

For businesses that have less experience with it all than some others, it may seem overwhelming. It doesn’t have to be, though.

Taking the time to learn and grow with the technology will strengthen your business and help keep it up to par with the market.

Comprehensive Consulting Solutions for Small Businesses is here to make the process easier and help you along the path of optimization. For more information, contact us at (479) 935-2488 for a free consultation.

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