Following on from the invention of the steam engine, the conveyor belt and electronic controls, the integration of the Internet into manufacturing is heralding the fourth industrial revolution. Anyone who ignores the trend will be left behind.
The Internet has fundamentally and irreversibly changed the business world and people’s private lives, and is now in the process of conquering manufacturing industry too: In future, companies will interconnect their machinery, warehousing and operating resources globally on the basis of digital systems. Continuous round-the-clock global data interchange will enable connected machines to control themselves autonomously, work more efficiently and detect faults rapidly. This is the vision of an Internet-dominated industrial infrastructure, now also being referred to as the “fourth industrial revolution”.
In Germany, the designation “Industry 4.0” has been adopted to describe the trend. One of the key people involved in instigating that name was Henning Kagermann, President of the German National Academy of Science and Engineering Acatech. He has no doubt that the Internet is heralding a new era in manufacturing industry: “This trend is comparable to the three great revolutions which paved the way for modern industrial society: the invention of the steam engine in the 18th century, the introduction of conveyor belt production lines in the late 19th century, and latterly the development of electronic controls in the second half of the 20th century.”
Huge volumes of data are being collected and analysed
The route to “Industry 4.0” – or Smart Manufacturing – involves a number of different elements: its foundation stone is the ability to equip industrial plant and machinery with a wide variety of sensors and other means of collecting data. That is already driving exponential growth in data volumes – known as “Big Data”.
Supplementing that data with data from the Internet of Things creates a vast array of data resources incorporating manufacturing plant and machinery, products, factories, supply chains, and much more. New technologies are delivering the means to collect and process these data volumes.
A further boost is being delivered by ever-expanding capabilities in the field of analytics. Today, data can already be collected and analysed to provide detailed information on the current status of a machine. This can then be used to predict machine failures or other incidents.
The result is a system combining information from different players along a value chain – from the initial vision of a product, through its manufacture and updates to end-of-life disposal. The ultimate outcome is a powerful system integrating and interlinking all processes in real time. The physical and digital worlds become one. The term used for such creations is “cyber-physical systems”, whereby industrial plant and machinery – and even entire factories – acquire a second identity, a mirror image based on data, in cyberspace.
Industrial manufacturing will be reorganised
Ultimately, Industry 4.0 will bring about a complete reorganisation of industrial production: the interconnection of machinery, plant, workpieces and products is creating intelligent manufacturing systems capable of controlling themselves and each other with no manual intervention. The focus of this trend is on greater flexibility and dynamism: the aim is to manufacture a single product item (in industry also termed “batch size 1”) at the cost of a mass-produced item. Value creation processes adapt to changing requirements in real time. As a result, passive, pre-determined manufacturing systems are replaced by active, autonomous, self-organising production units. The smart product actively supports its own production process. Manufacturing not only becomes highly flexible and productive, but also consumes fewer resources and is generally more sustainable.
Added value based on new business models
What is “revolutionary” about all these visions is not so much their technical implementation as the wealth of previously inconceivable new business possibilities opened up by the availability of data and the ability to combine different data resources. One aspect of these new trends is Smart Services. These are based on evaluation of digital data from smart products to extend the manufacturer’s value chain. In the past, the value creation ended when the product – such as an agricultural machine or aircraft turbine – left the factory. In future, manufacturers will have access to data collected digitally during use of their connected products. This will enable the creation of business models covering the complete product life-cycle. Based on analysis of the data, manufacturers will be able to develop new service and maintenance models, optimise machine operation at their customers’ facilities, or create new product offers across multiple sectors, for example.
Anyone who does not move with the trend will get left behind
Frank Riemensperger, CEO of Accenture Germany and member of the board of BITKOM, comments: “We are seeing dynamic growth in smart products equipped with a multitude of sensors and an Internet connection. Many companies have already committed to the online world, and are working intensively on digital business models for their products. Sooner or later, every company will have to deal with the effects of digitisation on their business model.” Anyone who fails to do so will be placing their business at risk, as Muthukumar Viswanathan, Industrial Automation & Process Control Practice Director of Frost & Sullivan, warns: “Industry 4.0 is all about meeting future challenges. The industrial landscape is going to change dramatically. Companies which fail to prepare and adapt to that change will be left behind. Their products or solutions might well be overtaken, and ultimately disappear altogether.”