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Benefits and opportunities of Industry 4.0 for companies

Many companies are already deploying Industry 4.0 technologies. With Industry 4.0, they are primarily pursuing the objectives of increased productivity, reduced costs, improved quality, and shorter product launch times. New business models still have a minor role to play.

Companies in intensely competitive sectors have always needed increases in productivity to improve their competitive position. However, traditional productivity-enhancing methods are reaching their limits in many companies. The enormous potential of digitisation is going untapped. In mature markets, growth is often only achieved through displacement. This raises two questions about the benefits of Industry 4.0 and the road ahead:

  • How can companies profitably exploit the potential of Industry 4.0 to increase their corporate value?
  • How can companies identify and utilise the technical and organisational opportunities of Industry 4.0?

Companies need to define key competences such as cryptography, blockchain, artificial intelligence, augmented reality, virtual reality, big data, and IoT platforms in conjunction with personnel and organisational development within the framework of their I 4.0 strategy. Data management, process transformation, and new, profitable business models will determine the success of their Industry 4.0 strategy.


Technologies and spread of Industry 4.0

Increasing numbers of products, machines, and means of transport are gathering data and communicating via the Internet. Companies gain valuable insights from this data for new products, services, and business models as well as knowledge for increasing production efficiency. This can be explained using the following examples.

In preventative maintenance, the systematic and AI-supported analysis of data means it is possible to reduce downtime due to technical problems, while simultaneously lowering operating costs. This has prompted a few companies to develop new business models. Instead of purchasing a machine, the customer only pays for the time that it is in use. Another example is a service to optimise maintenance by means of remote monitoring and the preventive replacement of components based on condition. In both cases, the manufacturer increases customer loyalty through direct interaction with the customer, builds trust and is thus given an opportunity for new lines of business and business models.

Among other things, virtual and augmented reality (AR, VR) are used so that personnel with no specific training in maintenance can carry out maintenance and repair work remotely under supervision. In conjunction with simulations, VR and AR make important contributions to the design of production and logistics systems well before physical commissioning – cardboard engineering goes digital – in this way, ergonomics, material flow, and systems can already be optimised during project planning. Furthermore, they provide effective training possibilities for employees, which increases the degree of practice at an early stage and dramatically shortens practical training times on the system.

Despite these successes, a heterogeneous picture is being produced when introducing Industry 4.0. If already implemented concepts of Industry 4.0 are analysed by company size, it can be seen that SMEs are more reluctant to use these technologies, and do so less frequently, than large companies. High investment costs, unclear business models, and insufficient training with the new technologies among the workforce are given as reasons. Furthermore, the availability of I 4.0 specialists within companies and on the labour market across all sectors and company sizes is cited as an obstacle to the widespread implementation of Industry 4.0.


Trends and developments of Industry 4.0

The significance of data and, consequently, data management will grow in future. AI (artificial intelligence) methods will soon provide assistance in making business decisions. Digital shadows make it possible to save on expensive prototypes and dramatically reduce the time to market – reductions of over 50 % are possible.

Access to data as well the processing of data also play a central role in the development of new business models in the platform economy. Data security and cyber security are prerequisites for seamless business processes. Furthermore, the analysis and evaluation of large volumes of data using artificial intelligence methods is gaining in importance as a basis for new products, services and business models. In future, artificial intelligence (AI) will be the foundation for the commercial success of companies in all sectors. A proactive approach to the use of AI is essential.

The path to the digital factory is inconceivable without digital shadows for products and production. The logical next step is the integration of actual data from the value chain, i.e. the networking of digital shadows with MES and ERP systems. In this way, it is possible to simulate scenarios for possible production disruptions or rescheduling. The goal is to reduce production interruptions to a minimum should they still occur unexpectedly. Knowledge about the impacts of process parameters on quality makes it easier to adapt processes more quickly in case of deviations, i.e. also preventively.

These trends and developments regarding I 4.0 require targeted personnel and organisational development. Industry 4.0 technologies enable new, more efficient processes and procedures. However, these processes must first be designed so that they are digitisable. This applies equally to cross-departmental, cross-functional and cross-company processes.


Benefits and opportunities for companies

Industry 4.0 offers companies many opportunities to optimise business models and company processes. Consistently focusing on the customer, digitising products and processes, and working in value networks changes companies.

For companies, exclusive access to usage data relating to their products leads to new services and requires an even stronger focus on the customer. In addition, companies must use this customer focussed data to create new business models. Moreover, they must prevent platforms from being established between them and the customer and developing their own business models. Once direct access to the customer is lost, the manufacturer of products becomes interchangeable. Data is a new raw material that needs to be used skilfully.

Value creation in networks is constantly growing in importance.  Temporary partner networks with the appropriate skills are being established in order to respond to customer requirements more quickly. However, this also results in new requirements in terms of data management and cyber security across company boundaries. With the right configuration, blockchain technology can be a smart response to these requirements.


INNOand Industry 4.0

From INNOand’s point of view, a holistic, customer-oriented approach is required to ensure the profitable implementation of Industry 4.0. This approach means that processes can be simplified, efficiently designed and effectively digitised across functional and company borders. We will accompany this process transformation and safeguard it with technologies such as the blockchain. 

Using the maturity model supported by key performance indicators that we have developed, we will identify key technical and organisational areas of action for your company. The result is your own individual digital roadmap towards a profitable and sustainable implementation of Industry 4.0. We do not stop at the concept level. During the implementation phase, we will support your company according to the proven triad of INNOVATION, ORGANISATION and TRANSFORMATION. We have the right experts on application in key competences such as cryptography, blockchain, artificial intelligence, AR/VR, data analytics, ERP, and personnel and organisational development.