Opportunities, Challenges, and Solutions for Industry 4.0

Introduction

Industry 4.0 (I4.0) is the common term referring to the use of cyber-physical systems (CPS) which comprise numerous major innovations in digital technology such as artificial intelligence (AI), Internet of Things (IoT), machine-to-machine link, data capture and data analytics, cloud computing, advanced robotics and smart production facilities. Such systems are capable of independently exchanging information, triggering actions, controlling each other independently and making autonomous decisions. In fact, CPSs are driven by cutting-edge software, computational power, programmable logic controllers, and sophisticated sensors and cameras to process vast amount of data using advanced predictive algorithms, monitor real-time transactions at every monitor real-time transactions at every stage of a process in the value chain right from customer ordering, marketing, suppliers, procurement, design and development (R&D), manufacturing, logistics and customer services, finally make large-scale centralised decisions without human intervention (Brettel, Friederichsen, Keller, & Rosenberg, 2014). In another example, such systems can use Internet Protocol (IP) addresses, Quick Response (QR) codes and Radio Frequency Identification (RFID) tracking tags to keep track of the manufacturing of every product and process using by online computer and smart-phones apps with the ease of a button and on-the-go.

The development of I4.0 technologies is fast changing the landscape of global supply chain at a breakneck pace. In this regard, digitalisation of the supply chain is underway to achieve operational efficiency and cost competitiveness. MNCs can leverage on digital global economy which are driven by information, ideas and innovation. Most leading companies are deploying such I4.0 technologies to share market intelligence and organizing their orders by divisionalsing their product lines according to the cost-base structures, economies of scales and tariff-free, and full market access with a view to realising high-flexible, individualised and resource-friendly mass production. In other word, I4.0 technologies will make such smart factories work easier, safer, leaner and more productive through I4.0 digital sphere. In today’s competitive environment, most MNCs certainly cannot afford to look nervously over their shoulders at rivals taking command of the technology revolution, instead quickly jump on the bandwagon of adopting I4.0 cutting-edge technologies to stay competitive, connect more closely with customers and finally propel organisations towards for more sustainable growth (Ghobakhloo, 2018; Pandiyan, 2017).

Taking a quick look back in time the at these first three industrial revolutions, it is worth mentioning that Industry 1.0 refers to use of the mechanical production harnessing the power of water mills and coal-fired steam turbines in Britain in the late 1765, Industry 2.0 refers to the introduction of division of labour and electrically powered assembly lines especially pioneered by Henry Ford and Frederick Taylor in the manufacture of cars in 1870, and finally Industry 3.0 refers to the use of electronics and telecommunications and computers that further automate production in 1969. Over the course of history, mankind has perfected its industry by creating and striking innovations all throughout their revolutions. Indeed, previous three industrial revolutions have liberated humankind from animal power, made mass production possible and brought digital capabilities to billions of people (Sentryo, 2017).