The first industrial revolution began in the 18th century when the power of the steam engine was harnessed and manufacturing first became mechanized. The Second used electric power and the assembly line mass production using the conveyor belts. The Third used electronics, memory-programmable controls, computers and information technology to automate production using robots.”
Now a Fourth Industrial Revolution is building on the Third, by adding layers of efficiency and intelligence on top the digital revolution. It is bringing the cyber physical systems together i.e. smart machines capable of exchanging real time information over the industrial internet of things (IIOT) for decision making process. In this revolution big data, analytics and digital technology will play a number of roles, from improving energy usage to making manufacturing safer to resource optimization and conservation.
The supply chain today is a series of largely discrete, siloed steps taken through marketing, product development, manufacturing, and distribution, and finally into the hands of the customer. Digitization brings down those walls, and the chain becomes a completely integrated ecosystem that is fully transparent to all the players involved — from the suppliers of raw materials, components, and parts, to the transporters of those supplies and finished goods, and finally to the customers.
This will dramatically streamline the conventional order-design-manufacture-supply process enabling customers to communicate requirements directly with the manufacturer’s production systems, which will generate the data needed to make the product, order the necessary raw materials from suppliers, schedule manufacturing time, organize despatch of the finished products and take payment.
This form of manufacturing, called Industry 4.0 is a collection of technologies and concepts for defining and operating ‘Smart Factories’, where the machinery of manufacturing – machine tools, the sensors monitoring them and such like – can communicate with each other, with the systems overseeing the factory and the people who work in it to fine-tune the manufacturing process and enable such things as product customisation, while increasing productivity and flexibility. These intelligent and connected machines don’t only work; they take decisions and optimize processes intelligently and semi-autonomously.
This technological revolution will fundamentally alter the way we live, work, and relate to one another. In its scale, velocity, scope, complexity, and systems impact the transformation will be unlike anything humankind has experienced before. When compared with previous industrial revolutions, the Fourth is evolving at an exponential rather than a linear pace. Moreover, it is disrupting almost every industry in every country. And the breadth and depth of these changes herald the transformation of entire systems of production, management, and governance.
Worldwide Race has begun for dominating the 4th industrial revolution, or Industry 4.0 between Germany, US and Japan with China which will also lead to dominance in aerospace and defence industrial base. Mr Frank Kendall, Former Under Secretary of Defense (Acquisition, Technology and Logistics), USA said that the 4th IR could not only boost productivity but also bring about a revolution in military affairs. Mr Kendall opined that governments had an obligation to invest in and develop 4th IR technologies because potential adversaries would invest and use them in less ethical ways.
Impact of Covid
In 2020, industrial digitization faced its biggest test to date. Confronted with the largest health and economic crisis in recent history, companies across sectors were forced into extraordinary measures to protect their people and maintain operations. While some contended with keeping the operations running in the face of shortages of workers or raw materials, others struggled to keep up with the sudden spike in demand.
Analysis of a new McKinsey survey’s results suggests three outcomes: a win for companies that had already scaled digital technologies, a reality check for those that were still scaling, and a wake-up call for those that hadn’t started on their Industry 4.0 journeys. A consumer packaged-goods (CPG) company in Asia had built a digital twin of its supply chain before COVID-19, for example. It was able to use that to run multiple scenarios during the pandemic, preparing itself for sudden shutdowns of manufacturing locations or disruptions in raw-material supply. On the opposite side of the globe, a personal-protective-equipment (PPE) manufacturer in North America, in the process of increasing its capacity by installing a new manufacturing line, was able to commission the line using augmented reality-based remote assistance for project execution.
Industry 4.0: Technologies
Prof Ken Young Technology director, The Manufacturing Technology Centre (MTC), helpfully broadened the definition out to the use of digital technologies to give a competitive advantage, “that can be in the design phase, in the manufacturing phase where you’re monitoring what’s happening better and using that to improve simulation models so you can make the next lot better”.
Among the technologies behind the changes are cyber-physical systems, the Smart sensors, Internet of Things, robotics, cloud computing, machine learning, artificial intelligence (AI), nanotechnology, quantum computing and biotechnology. The seamless integration of software, equipment, and people that increases the speed, reliability, and flow of information between all systems of a manufacturer.
Smart sensors are one of the elements of Industry 4.0, which many describe as the evolution toward interconnectivity, automation, machine learning and decisions based on real-time data acquisition. Smart Sensors on the factory floor and in machinery of all types and sizes, detect stimuli of all types, from sound to motion to temperature, the digitization of this collected data yields information that tells manufacturers how their technology-enabled equipment and products are performing.
“A smart sensor, one that detects vibration in a piece of machinery, for example, comes with a platform, microprocessor and a storage element,” Mohamed (Mo) Abuali, Ph.D., is an adjunct professor at the University of Cincinnati’s College of Engineering and Applied Science says. “It can take the raw vibration signal data and convert it into actionable insights, which makes it so much more than a traditional sensor.” Smart sensors benefit a variety of business use cases, including minimizing downtime, outpacing the competition and meeting the demands of customers and new markets.
Industrial IoT (IIot)
Industrial IoT refers to the deployment of small sensors, sometimes with computing capabilities, that collect and monitor data in real-time throughout businesses. IoT sensors can be deployed in conjunction with basically anything from lights to HVAC (Heating, ventilation, air-conditioning) to factory floor machinery. Industrial IoT is a foundational technology of Industry 4.0. The benefits of connected equipment are tremendous, as it provides insight for better decision making on many levels of the organization.
Core of Industry 4.0 are intelligent machines that share information with one another, organise themselves and work together to coordinate processes and deadlines. This makes production much more flexible and efficient. In addition, the intelligent machines communicate directly with IT systems in a company. In the interplay with smart products, this technological quantum leap allows for the creation of new business models that create added values for customers.
Before the digitization of the factory, changing over a product line and optimizing its speed and production was somewhat guesswork and always imperfect. With today’s advanced simulation models powered by the IoT data and AI, manufacturing operations can optimize machinery for their next product run, thereby saving time and money.
This network will depend on a number of key technologies: integrated planning and execution systems, logistics visibility, autonomous logistics, smart procurement and warehousing, spare parts management, and advanced analytics. The result will enable companies to react to disruptions in the supply chain, and even anticipate them, by fully modeling the network, creating “what-if” scenarios, and adjusting the supply chain in real time as conditions change.
Horizontal and Vertical System Integration
Horizontal and vertical integration has been called the “backbone of Industry 4.0.” The premise of horizontal and vertical system integration is connectedness and visibility. This could mean either within a single organization or outside of it with industry partners. Machines and companies are constantly communicating and sharing data, helping to achieve deeper analysis opportunities, greater transparency, and increased efficiency for all.
If a company has within it multiple production facilities, horizontal integration can ensure seamless sharing about data issues such as inventory levels and delays. Vertical integration in manufacturing can include breaking down interdepartmental silos so the entire organization works as a unit—from R&D to procurement, and manufacturing to sales and beyond. Everyone shares data, everyone benefits and everyone operates dynamically.
Simulation / Digital Twins
As its name suggests, a digital twin is a virtual replica of an object, being, or system across its life-cycle. A digital twin can be of any real life entity, such as a city, factory, a tunnel , or even a jet engine. which often evolves in real-time along with its physical counterpart through data gathered through sensors. Connected sensors on the physical asset collect data that can be mapped onto the virtual model. Anyone looking at the digital twin can now see crucial information about how the physical thing is doing out there in the real world.
A digital twin, despite sounding like something ripped out of a sci-fi movie, is the very authentic technology behind creating a simulation of a real-world object, concept, or area within a digital space. It can include a 3D representation of all of the physical assets, operational systems and structures within an entire facility. The use cases for digital twin systems are hugely broad. Using industrial IoT sensors, a manufacturing company can “see” their entire shop floor in virtual space. They can view the location of every asset, its uptime, and maintenance needs (even those that have not yet arisen). They can even ‘look’ inside of machines which would be dangerous or costly to open in real life.
Augmented reality includes extra sensory input, usually visual, overlaid onto the actual world. Common examples include Google Glass and the game Pokémon Go. In manufacturing, augmented reality can be used for worker training and maintenance alike. New employees can learn how to use machinery that could be dangerous in a safe, virtualized environment before entering the factory floor. AR can also be beneficial during maintenance tasks by offering tooltips, repair manuals, and other notations to become readily visible on-site, within the technician’s field of vision.
Big Data & Analytics
Because every functionality of the manufacturing operation is being monitored and generating data, there are tons of data to sift through. However, big data analytics systems can utilize machine learning and AI technologies to quickly process data and give decision makers the information they need to make improvements across an entire manufacturing operation.
Big Data is exactly what it sounds like—massive amounts of data. Mountains of stats and numbers so huge that humans and teams could spend years sifting through it manually and still not derive a lot of real value. With machines in the driving seat, it’s a whole different story. Using today’s advanced computing capabilities, those huge streams of pure, unadulterated data can be transformed into accurate, actionable insights that can drive decision-making for manufacturing leaders. Data sources can include everything from IoT sensors on factory floors and lighting systems to sales data or supply chain-related factors like the weather and political climate. Big data underpins much of the other technology of Industry 4.0. The more data is used, the greater the level of effectiveness.
Manufacturers don’t have or want to use the massive amount of space required to physically store vast volumes of data created in an Industry 4.0 operation. This is what makes cloud storage and computing an absolute necessity and key cog in a connected factory. Cloud usage also allows for a single source of truth and data sharing across the company, at lightning speed. Lastly, cloud storage also allows for remote access and monitoring of all data and machine operating systems, giving great visibility into operations and efficiencies.
AI / Machine learning
Artificial intelligence and machine learning refer to machines which utilize algorithms to process data and reach conclusions that were not programmed into them by human developers. These machines learn from data in order to generate increasingly accurate predictions
Artificial Intelligence and its subset machine learning are practically a requirement for an Industry 4.0-enabled smart factory. The whole premise around this new industrial revolution is to take out manual processing, and AI is the primary tool to use in its place. AI can use the data generated from a connected factory to optimize machinery, reprogram workflows, and identify overall improvements that can be made to drive efficiencies and ultimately revenue.
All of the Industry 4.0 connectivity – sensors, IoT, AI, etc. – services one primary purpose: optimizing manufacturing processes. Automation allows manufacturers to work faster, data analytics empowers leadership to make data-driven decisions to increase efficiency, predictive maintenance means less downtime for machines, and monitoring systems provide real-time yield optimization across the operation.
Additive manufacturing means creating items layer by layer, adding new material rather than subtracting it. This is compared to the old way of manufacturing (subtractive manufacturing), which covers tasks like cutting and carving wood, etc.
Autonomous robots are self-sufficient machines that can manage their tasks intelligently without the need for a human operator. They quickly and accurately perform repetitive tasks, even if they are complex, while requiring little to no downtime except for maintenance.
Because every touchpoint in the manufacturing operation is connected and digitized in Industry 4.0, there is an extra need for robust cybersecurity. Without sufficient cybersecurity are exposed to the threat of stolen intellectual property, manufacturing equipment commandeered by saboteurs to create faulty products, ransomware, identity theft, and more. Cybersecurity technology is anything that protects your digital systems from internal and external attack vectors. Manufacturing machinery, computer systems, data analytics, the cloud, and any other system connected via IoT should be protected. Modern cybersecurity involves tech such as blockchain or artificial intelligence and can guard new technologies such as industrial IoT devices.
Global Race between Germany, US, Japan, China and India
Germany, US, Japan and China are racing to implement Industry 4.0 that is expected to have a great effect on global economies, delivering estimated annual efficient gains in production of between 6% and 8%.
The global Industrial Internet of Things (IoT) market is valued at USD 82.4 Billion in 2020 and is anticipated to grow with a CAGR of 21.3% during the forecast period from 2020 to 2028.
The 2018 World Economic Forum (WEF) report ‘Readiness for the Future of Production Report’ assessed how well-positioned global economies are to shape and benefit from changes in production being driven by the Fourth Industrial Revolution. The 25 Leading countries in alphabetical order are: Austria, Belgium, Canada, China, Czech Republic, Denmark, Estonia, Finland, France, Germany, Ireland, Israel, Italy, Japan, Republic of Korea, Malaysia, Netherlands, Poland, Singapore, Slovenia, Spain, Sweden, Switzerland, United Kingdom and United States.
The following factors were taken into account to establish the list: Technology and innovation; Human capital; Global trade and investment;
Institutional framework; Sustainable production and Demand environment
In Germany, the Industry 4.0 platform was established as a public-private central coordination model and a focal point for all I4.0 activities. In 2006, the German government launched a policy as one of it’s national strategic initiative. Germany has the potential to evolve as a leading market and supplier for Industry 4.0. German-based companies are global leaders in important high-tech industries such as machinery, automotive, chemicals, pharmaceuticals, electronics and aerospace. Moreover, German companies are among the world’s leading providers of enterprise software.
Some enterprises already employ more IT professionals than traditional engineers. They program operating systems for machinery, convert sensor data into valuable new information and integrate embedded systems in a growing number of products. Companies that invest in Industry 4.0 technologies and the creation of new business models are highly dependent on the regulatory framework, as legal provisions can relieve or impede the adaption of new digital solutions and the cooperation with companies abroad. Therefore, governments have to set the right framework that facilitates innovation and cross-border cooperation in the area of Industry 4.0.
In line with Industry 4.0, a concept of Industrial Internet has been brought up in North America by the General Electric (GE) company in late 2012. It is seen as a tight integration of physical and digital worlds that combines big data analytics with the Internet of Things. The concept assumes a much broader application area as the Industry 4.0 and covers power generation and distribution, healthcare, manufacturing, public sector, transportation, and mining. Given the importance of manufacturing to the United States and the interest it has generated, many initiatives are currently being supported by the federal government in advancing the concepts in Industry 4.0. Some of the initiatives are 2nd Advanced Manufacturing Partnership (AMP2.0), National Network for Manufacturing Innovation (NNMI) and Manufacturing Extension Partnership (MEP).
In April 2016, the Japanese government enacted the 5th Science and Technology Basic Plan. It covers many aspects, including innovation promotion and internationalisation. A focus point, however, is the development of the society towards a Smart Society, the “Society 5.0”, through the full utilisation of technological innovation including Internet of Things (IoT), Artificial Intelligence (AI) and Big Data, that derived from Industry 4.0. Considering this, the Japanese government has announced “Connected Industries,” as a new concept framework in which industries will create new added value and the solutions to various problems in society through connectedness of various facets of modern life, including humans (including the roles as consumers and suppliers), machines, systems, companies.
The Chinese government has adopted a ‘Made in China 2025’ economic development strategy which is emerging as a huge risk to Germany’s economic base, says economist Christian Rusche from the IW think tank in Cologne. Siemens announced in mid-September its intention to lead the group’s global research and development (R&D) in autonomous robotics from within China. Siemens’ investment in China is indicative of the new industrial revolution taking place within the country as its strategic industries – including China’s influential aerospace and defence (A&D) enterprises – position themselves to meet national targets and become world leaders in Industry 4.0 technologies in the coming decade and beyond, according to Janes.
In France, the concept ‘Industrie du futur’ was introduced as a core of the future French industrial policy. It is based on cooperation of industry and science and built on five pillars: (1) cutting edge technologies including additive manufacturing, virtual plant, IoT, and augmented reality, (2) supporting the French companies, especially small to middle ones, to adapt to new technologies, (3) extensive employees’ training, (4) strengthening international cooperation around industrial standards and (5) promotion of French industry of the future.
South Korea came up with a program to help technologically rather weak SMEs to transform their workshops into smart factories. Its “Manufacturing 3.0” program has vision of transforming around 10,000 SMEs to small, but smart, global high-tech manufacturers by 2020.
India is keen on adopting Industry 4.0 and has taken several initiatives. According to IBEF, the Government of India plans to increase the contribution of manufacturing sector to 25% of Gross Domestic Product (GDP) by 2025, from the current level of 16%. India is also prepared to face global competition by undertaking the Make in India programme. It is all set to lead the world with Smart Manufacturing.
Although India is yet to have a solid footprint on the global map of digital manufacturing transformation, a dozen-odd companies in the country are moving fast in this field, according to the World Economic Forum white-paper released in 2019 in collaboration with McKinsey. India has demonstrated efforts toward adopting Industry 4.0 with initiatives such as the setting up of Industry 4.0 ‘Experience Centres’ which serve the purpose of eventual knowledge and technology transfer. The Indian government has allocated seed investments for these centres to source the technology as well as hire global expertise with the intention of eventually acquiring new innovations and technology assemblies for India.
In November 2016, Melbourne’s Swinburne University of Technology and the Australian Manufacturing Growth Centre announced a joint project to promote the use of smart manufacturing solutions in Australia’s manufacturing sector. The partnership is the first of its kind, being initiated expressly to promote the use of Industry 4.0 technologies in Australia.
Germany pioneer country in the development of Industry 4.0
Germany is the pioneer country in the development of Industry 4.0. Today, every area of Germany’s economy – not just its world famous manufacturing sector – is embracing digital innovation. Across the country, more than half of all businesses are increasing investment in digital technologies according to a survey by Tata Consultancy Services and Bitkom Research, part of Germany’s leading digital industry association. The survey shows that while on average companies invested 4.6% of their revenues in digital technologies in 2016, more than half of businesses were investing between 5% and 10% of revenues.
Smart Factories are a key feature of Industrie 4.0. , “Industrial production machinery no longer simply ‘processes’ the product, but that the product communicates with the machinery to tell it exactly what to do,” the GTAI, which promotes German business and technology on behalf of the German government, said. The German government is funding a research initiative CoCoS project that involves the development of a ‘smart’ production line, where each individual machine involved in a production cycle is separately networked with one another and other central systems. The aim is to enable the integration of production systems throughout a supply chain and allow decision makers to adapt components of the production cycle more easily to reconfigure what is produced.
Europe: Initiatives at EU to regain lost ground in the past two decade
Alongside Germany’s Industry 4.0 project the EU and individual countries across the continent have set up their own activities aimed at preparing for the production of the future.
At European level, Industry 4.0: Powering Europe, a German-led high-impact initiative, has been launched at the ICT Labs of the European Institute of Innovation & Technology (EIT). Its aim is to bring about a rollout of cyber-physical platforms across European smart factories. There is also the Factories of the Future public–private partnership aimed at supporting mainly small and mid-size companies in their efforts to stay successful in global markets in the future.
Individual countries are also active: Finland intends to spend some €100 million on its Industrial Internet program by 2019, whilst Austria plans to inject around €250 million into its vision of Industry 4.0. France, the UK, Italy and the Netherlands have likewise launched their own initiatives such as the so-called “Factory of Future” in Italy and France and “Catapult centres” in the UK. Moving towards Industry 4.0 will permit Europe to increase its diminishing industry share from 15% up to 20% of the area’s value added. It means that Europe will be able to compete successfully with other industrial areas in the world.
US’s Industrial Internet Consortium (IIC)
The Industrial Internet Consortium (IIC) was established in the USA in March 2014. It comprises more than 100 companies, including General Electric, IBM, Intel, AT&T, and Cisco, all working on technologies for the production of the future – with German heavyweights such as Siemens and Bosch among them, too. Importantly, it collaborates with Plattform Industrie 4.0, the German body developing standards for Industry 4.0 The two organisations have independently developed reference architectures for the Industrial Internet and have been working since 2015 to bring the architectures into alignment.
Its members include small and large technology innovators, vertical market player, researchers, universities and government organisations. It aims to bring together industry players—from multinational corporations to academia and governments—to accelerate the development, adoption and wide-spread use of Industrial Internet technologies.
Industrial Internet is merger of the information technology (IT) world with the operational technology (OT) world. The goal of that merger is the Industrial Inter‐ net, variously known as the Industrial Internet of Things, Internet 4.0, Internet +, and other monikers. The industrial Internet draws together fields such as machine learning, big data, the Internet of things, machine-to-machine communication and Cyber-physical system to ingest data from machines, analyze it (often in real-time), and use it to anticipate maintenance needs and adjust operations.
The IIC’s vision is largely consistent with the goals of Industry 4.0: to make production more efficient and to optimize value chains. In addition, the companies are striving for higher machine availability and the cost-effective manufacture of customized products. In 2015, the IIC published the Industrial Internet Reference Architecture, a lengthy document that describes and defines the various systems and frameworks necessary to sustain a viable Industrial Internet.
Japan Is Leaping Towards Smart Factory Implementation
Japan aims to achieve “Society 5.0” in the future through the full utilization of technological innovation including IoT, AI and Big Data derived from the fourth industrial revolution. To achieve Society 5.0, industries must play a key role. In light of this, the Japanese government has announced “Connected Industries,” as a new concept framework in which industries will create new added value and the solutions to various problems in society through connectedness of various facets of modern life, including humans (including our roles as consumers and suppliers), machines, systems, companies.
Yaskawa Electric, a Japanese company that builds systems controls and various other industrial products, has over a thousand motors installed in various devices in its one manufacturing space. Using advanced IoT methods, Yaskawa monitors all these motors in real time and can ascertain each one’s operating status at a glance. Rather than wait for the moment of death that could unexpectedly shut down the manufacturing line for some length of time, line workers can see the failure coming, thanks to the IIoT, and get a replacement into position to take over before the original one croaks. Presto. The line stays up and running with zero interruptions.
Japan has launched the Industrial Value Chain Initiative with 30 companies developing common communications standards for linking factories and facilities. “We aim to establish a structure that will connect even small and mid-sized companies via the Internet beyond affiliates and across sectors,” said Yasuyuki Nishioka, a professor of information and industrial engineering at Tokyo’s Hosei University, who is the driving force behind the initiative.
“The diversification of needs and digitalization of products and production processes make the ‘power of connecting’ more important,” Yasuyuki Nishioka, Professor at Hosei University, says. Factories and enterprises are “connected together,” and a new generation of information technology called the IoT (Internet of Things) plays a role in “connecting” them. The automation that is progressing at manufacturing sites in Japan has been accelerating more than ever before through the use of sensors and other devices.
China’s roadmap to Industry 4.0
In 2014, China’s State Council unveiled their ten-year national plan, Made-in-China 2025, which was designed to transform China from the world’s workshop into a world manufacturing power.
China’s “Made in China 2025” initiative
China’s cabinet has unveiled a national plan, dubbed “Made in China 2025,” focusing on development and the upgrading of the manufacturing sector to improve innovation ability, integrate informatization and industrialization, through green manufacturing and manufacturing internationalization. The plan was introduced in May 2015 and implementation guidelines were completed in Feb 2017 by the Ministry of Industry and Information Technology, with the participation of more than 20 State Council departments.
The program aims to increase the domestic content of core materials to 40% by 2020 and 70% by 2025. At present, domestic content is relatively low for high-tech goods, with foreign content comprising more than 50% in these products on average. In some categories, such high-level digital control systems and high-level hydraulic components, China is almost entirely dependent on foreign production.
Miao Wei, Minister of Industry and Information Technology “Made in China 2025” is just the first step of a three-step strategy. According to another two plans that followed, China will reach a medium level among the world’s best manufacturers by 2035 and rank near the top of the league table by 2045. These plans, are designed to transform China into a leading manufacturing power by the year 2049, which will be the 100th anniversary of the founding of the People’s Republic of China.
The World Bank reports that manufacturing contributed 40 percent of China’s GDP in 2017. Maintaining this key sector means China’s ‘Made in China 2025’ Industrial Internet of Things (IIoT) strategy focuses most on manufacturing than other areas, but its investments are paying off in multiple verticals. Alex Sinclair, chief technology officer, GSMA states: “China is betting big on the Industrial IoT to increase productivity and drive efficiencies by streamlining and automating manufacturing processes via internet connectivity. Backed by positive government support, China is set to become the world’s leader.” Chinese economists estimate a productivity level increase of up to 30% with the help of Industry 4.0 in China. Unforeseen production losses could decline by 60%.
The country has always been willing to make big infrastructure investments to secure its future. Accenture predicts China’s IoT investments could add $196 billion to cumulative GDP in “manufacturing industries alone” over the next 15 years. China accounted for 28 percent of global spending on IoT and 29 percent of total robotics investment in 2017. IoT deployments are being put in place across all the key sectors: manufacturing, public services, energy and resources, healthcare, education and transportation.
China has forged ahead in fields such as new generation IT (companies like Huawei and ZTE are set to gain global dominance in the roll-out of 5G networks), high-speed railways and ultra-high voltage electricity transmissions. More than 530 smart manufacturing industrial parks have popped up in China. Many focus on big data (21 percent), new materials (17 percent) and cloud computing (13 percent).
Recently, green manufacturing and the creation of an “Industrial Internet” were given special emphasis in policy documents, underpinning President Xi Jinping’s vision of creating an “ecological civilization” that thrives on sustainable development. China has also secured a strong position in areas such as Artificial Intelligence (AI), new
energy and intelligent connected vehicles.
The electric vehicle (EV) battery market is a powerful example of how quickly such dynamics may unfold and global value chains are absorbed. In 2017, seven of the top ten EV battery companies were Chinese, accounting for 53
percent of the global market share. The expansion of China’s battery manufacturing capacities is in the pipeline and could amount to three times that planned in the rest of the world.
Within China’s A&D sector the Industry 4.0 focus is being led by the China Aerospace Science and Industry Corporation (CASIC), one of the country’s most important developers and manufacturers of advanced weapon systems. CASIC is channelling its Industry 4.0 programme through a cloud manufacturing system initiated in 2015, which seeks to leverage industrial internet technologies such as cloud computing, IoT, big-data analytics, and advanced computing. The system is called CASICloud, www.casicloud.com, and is geared towards linking CASIC with its Tier 2 and 3 suppliers across the many sectors the group operates, including A&D.
In June, state-run newspaper China Daily quoted Shu Jinlong, chairman of CASICloud Technology, a subsidiary that is responsible for the system, as saying that more than 800,000 companies had subscribed to CASICloud – including 3,000 foreign firms – with more than 90% of these suppliers designated as small and medium-sized enterprises (SMEs). In time, CASIC is aiming to attract up to 10,000 SMEs from abroad as part of wider efforts to expand in international markets and gain access to foreign technologies. While CASICloud is applied across several sectors, opportunities in A&D have been underscored by other Chinese state-owned defence enterprises – including the Aviation Industry Corporation of China (AVIC) and the China Electronics Technology Group Corporation (CETC) – participating in the cloud manufacturing programme. In addition, CASICloud is partnered with China’s military procurement portal, www.weain.mil.cn, presumably to boost industrial responses to tender opportunities.
Germany China collaboration on Industry 4.0
Germany’s economy and energy minister, Vice Chancellor Sigmar Gabriel, and China’s minister for industry and information technologies, Wei Miao signed an agreement promoting cooperation of German and Chinese firms in “intelligent manufacturing and digital networking of production processes,” according to a statement from Germany’s economics and energy ministry. That will involve developing links between the German government’s “Industry 4.0” strategic industrial development program and China’s “Made in China 2025 “initiative.
The ministerial agreement sets out “general bases of cooperation.” Those include effective protection of intellectual property rights, voluntary decision of companies on whether or not to transfer technologies, joint German-Chinese development of norms and standards, data security for the firms involved and efforts to improve the framework conditions for entrepreneurs. For China this cooperation and the notion of implementing industry 4.0 in China in general is said to be an outstanding opportunity. Some observers think cooperation with China in this area entails serious long-term risks for German industry because Germany and China’s economies are both based on industrial production.
“Industrial production is Germany’s main economic strength. The USA is the leader in digitization and infotech in general, less so in industrial production. In that sense, the two countries have complementary strengths. China, in contrast, directly competes with Germany in industrial production,” said Christian Growitsch, director of HWWI, the Hamburg Global Economy Institute, a think tank.
“Take Transrapid high-speed trains, for example,” Growitsch said. “Germany developed them and went into a joint venture in China. Now China is building high-speed train on its own, and dominates world markets.” “That suggests maybe Germany should consider approaching the US as its key partner on Industry 4.0, more than China,” he added.
He added that cooperation with American firms on digitization of industrial processes also entailed risks. If American infotech firms cooperate with German machine-tool makers on development of Industry 4.0 systems, those infotech firms could at some point decide to apply their knowledge to joint ventures with American machine-tool makers.
In 2018, the World Economic Forum setup its Centre for the Fourth Industrial Revolution in India to work in collaboration with the GoI. The National Institute for Transforming India (NITI) Aayog is the designated nodal agency to interact with the World Economic Forum for elaborating the new policy frameworks for emerging technologies. The GoI has already made the enabling policy framework and set up incentives for infrastructure development on a PPP (Public Private Partnership) model.
Samarth Udyog Bharat 4.0 (Smart Advanced Manufacturing and Rapid Transformation Hubs) under the Department of Heavy Industries (Ministry of Heavy Industries & Public Enterprises) is the India’s initiative to push for Industry 4.0 implementation with an aim to propagate technological solutions to Indian manufacturing units by 2025 through steps like awareness programme, training, demo centers etc. The industry, academia and international cooperation in the field of technologies related to Industry 4.0 is the policy formulated by the government. India’s National Manufacturing Policy (NMP) has been promulgated which aims at enhancing the share of manufacturing in GDP to 25% and Industry 4.0 is the only way ahead to achieve this task.
Leading domestic industrial and engineering companies such as Larsen & Toubro, Reliance Industries NSE 0.55 % and the Tata group, as well as multinational firms including General Electric, Siemens are all trying to capture a share of the pie and the timing seems just right. For instance, L&T has built a digital platform in-house, which seamlessly connects diverse operations, improves efficiencies and cuts decision time. In its Mumbai office, CEO SN Subrahmanyan just walks across to a “control room” for real-time data from 400 company sites operating miles away. The smallest of data, such as the amount of electricity consumed by machines or the weight hauled by a crane at a construction site, are put together and analysed, helping L&T take big decisions to improve performance.
Global Industry 4.0 market size was valued at USD 74.8 billion in 2019 and is anticipated to which expected to reach USD 213.84 billion by 2027, growing at a CAGR of 12.77 % from 2020-2027.
Factors that drive the growth of the market include Industry 4.0, increasing use of industrial automation in manufacturing, government investments supporting industrial automation, rising emphasis on regulatory compliances, increased complexities in supply chain, and increasing demand for software systems that reduce time and cost.
Amidst sluggish economic growth, increasing productivity and lowering manufacturing costs have become quite critical for manufacturers all over the world. On account of this, manufacturing companies are witnessing intense competition, and this trend is expected to continue during the forecast period. To better optimize resources and reduce costs, manufacturers are actively focusing on adopting industrial automation and enabling technologies.
Industry 4.0 offers huge new market approach and segmentation as companies are able to produce a better range of products as the process of transforming customers’ requirements into actions is now has become seamless and sophisticated. All data on the latest trends and changes in customer behaviours can be captured in real time, making it possible to produce cutting-edge products which will lead to an exponential growth in every business.
Technology has always been the underlying factor behind previous industrial revolutions. Similarly, technology still remain as a critical factor for Industry 4.0 emerging technologies such as cloud computing, automation, Artificial Intelligence (AI), and IoT are forming an interconnected industrial landscape where physical assets and equipment are integrated with systems to enable contents and dynamic exchange and data analysis. For companies to achieve their Industry 4.0 objectives, automation, ubiquitous connectivity and intelligent systems are necessary. The advent of low power processors, disruptive capabilities of the IoT, intelligent wireless networks and low power sensors, when combined with ‘Big Data’ analytics, has led to a booming interest in the Industrial IoT.
IIoT is expected to hold the largest share of the smart manufacturing market for enabling technology. Various technologies are using IIoT to improve the functioning of the process. These technologies comprise of sensors, RFID, industrial robotics, distributed control system, condition monitoring, smart meter, electronic shelf label, camera, smart beacon, interface board, yield monitor, guidance and steering, GPS/GNSS, flow and application control device, and networking technology. Use of IIoT in these technologies helps to analyze the data collected via various devices and enables effective decision making.
Also, the evolution of cloud computing technologies, technological advancements in the electronics industry, implementation of smart factory concept & factory automation technologies, and government initiatives by different countries are estimated to foster the robust growth of the Industry 4.0.
Industrial communications is expected to hold the largest share of the smart manufacturing market for information technology. Industrial communications is a combination of components, software, and standard protocols that allows man-to-machine and machine-to-machine communication across various industries. Efficient, reliable, and secure industrial communications help in improving operational efficiency and reducing overall operational costs of organizations. Industrial communications plays a significant role in industries such as oil & gas, electronics, automotive, and energy & power.
Based on the end-user industry, the global Industry 4.0 market segmented into Automotive, Electronics, Oil & Gas, Energy & Power, Chemicals, Pharmaceuticals, Food & Beverages, Manufacturing, and Others. The manufacturing segment anticipated to dominate the market by 2027. It is attributable to manufacturing companies using industry 4.0 to increase the shortage of skilled workers in the manufacturing sector, and robots help optimize their performance and identify potential failures.
The global smart manufacturing market is centered on North America and Europe, as these two regions offer the latest technological advances. The solid government support to urbanization and industrialization in these regions has also helped drive the smart manufacturing market.
The smart manufacturing market in APAC is expected to grow at the highest CAGR globally . The economy in the APAC region is world’s one of the fastest evolving due to increased spending on improving performance, security, and economic stability. The region is witnessing a surge in the deployment of smart manufacturing technologies. China, being one of the top manufacturing countries, has been adopting enabling technologies to increase operational efficiency and production in the country. Due to increasing maintenance costs in manufacturing, manufacturing and energy & utilities industries have been genuinely considering the adoption of advanced technologies, such as predictive maintenance, to optimize maintenance processes and reduce operational costs.
Companies such as ABB, Mitsubishi, Yaskawa, KUKA, FANUC, General Electric, IBM, Cisco, Microsoft, Stratasys, Google, Intel, HP, Siemens, Ansys, AIBrain, SAP, Amazon Web Services, Texas Instruments, and General Vision, are the key players in the global Industry 4.0 Market.
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