Manufacturing and Industry 4.0


According to Forbes, we are in a fourth manufacturing revolution so remarkable it’s being referred to as Industry 4.0. Also known as the Digital Enterprise or Smart Manufacturing, a significant shift in the way we make products, thanks to digitized manufacturing, is occurring. Industry 4.0 has taken the computerization of Industry 3.0 and added automation to improve upon networks with clever systems and intelligent AI. As a result, factories are becoming smarter and more efficient, while also producing less waste.

The Now

The future of manufacturing is unfolding before us. Many big name manufacturers, like IBM, GE, Intel, Siemens, NVIDIA, and Microsoft are paving the way, and we can already see the results: early adopters of practices heavily influenced by Industry 4.0 are seeing significant outcomes, like over 80% increased efficiency; a 45% rise in customer satisfaction; and a nearly 50% drop in product defects, and these results are from only partial implementation.

As advanced microprocessors and sensors get smaller, and new software and forms of communication grow more affordable, smaller companies are able to follow suit. Smart Manufacturing can result in lower labor costs, increased worker and product safety, greater productivity, and improved environmental impact (by reducing energy and water use through optimization, and fewer raw materials in landfills from human error).

However, 37% of smaller companies have no interest in Smart Manufacturing. The cost of factory upgrades and finding skilled workers that are knowledgeable in these up-and-coming technologies is likely to blame. With less revenue, these companies are unable to advance with innovative projects. GE and Siemens have the resources to create departments to develop their own AI software. This isn’t feasible for smaller manufacturers. Sadly, these companies will struggle to catch up to manufacturing giants in the subsequent years, especially as the Digital Enterprise continues to prove itself as financially viable in the coming decades.

The Future

These are early days, and the full effects won’t be seen for several more decades. However, they’re already significant and expected to grow considerably in the next 3-5 years. The more manufacturers that get on board, the more substantial the results. It’s estimated that the global Digital Enterprise market will surpass $200 billion this year, and to rise to over $320 billion by 2020.

In 2019 there were around 2.6 million industrial robots in operation, up from 1.6 million in 2015. The more technologies, from robots, to 3D printing, to autonomous vehicles, employed, the more improvement across the entire manufacturing landscape. According to the Department of Defense, there have been close to 900,000 new manufacturing jobs created since February 2010.

IBM announced in 2017 it would spend $3 billion over the following four years to create a department dedicated to the “Internet of Things,” or IoT. Simply put, IoT is the interconnectivity of devices, such as computers and everyday appliances, via the Internet. The purpose is to communicate with each other to adjust to changing conditions, such as a weather delay, or needed maintenance, without the need for human interaction, so that manufacturers can react to events in real time.

The Digital Enterprise is critical not just to industrialized countries, but the developing world also. For the advanced world, manufacturing provides trade and innovation. However, for growing nations it’s a vital source for increased income and improved living conditions by providing growth, development, and exports. As manufacturing continues to change, and alter economies with it, we will observe developing nations evolve alongside it. It is estimated that by 2025 there will a new global consumer class, based mostly in developing economies, spurring growth, and offering new opportunities to expand into the global market. When a nation industrializes, manufacturing employment, as well as output, increases significantly.


Manufacturing is quickly evolving. It is causing established markets to shift, and creating new markets for companies to take advantage of. This leads to continued innovation as companies grow and morph to match their markets, both new and old. As they attempt to meet customer demands, most, if not all, manufacturers may find their way into Smart Manufacturing, taking advantage of this new Industrial Revolution.

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