In today’s episode, I will comment on the difference between three related topics used indistinctly on the web: Industry 4.0, Digital Transformation, and The Industrial Internet of Things.
As always, it will be simple and concise but accurate.
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If you want to know more about these topics, I strongly recommend reading Episode 10 and Episode 21.
What is the Industry 4.0?
Industry 4.0 is the acronym for the 4th Industry Revolution.
Many people think this is a new concept. but in reality, it was first introduced in 2015 by Klaus Schwab during a presentation at the World Economic Forum (2015).
But, if this is the fourth Industry Revolution, we may ask
What is an Industry Revolution?
Typically, a Revolution is a disruptive change.
An Industry Revolution (in this context) is the introduction of a new business model that improves the previous one, allowing the organization to reach new levels of Operational Efficiency and Customer Loyalty.
What is new in this revolution?
Industry 1.0 (1784) introduced the mechanization of manufacturing via the introduction of steam and water power. The improvement was in technology (People, process, and technology)
Industry 2.0 (1870) introduced the mass production assembly lines using electrical power. The improvement was a mix of technology and processes.
Industry 3.0 (1969) introduced automated production using electronics, programmable logic controllers (PLC), IT systems, and robotics. The improvement was a mix of technology and processes.
Industry 4.0 (2015) introduced autonomous decisions making cyber-physical systems using machine learning and big data analysis interoperability through IoT/ IIoT and cloud technology.
Industry 4.0 is an updated business model benefiting from the business’s digitalization.
What is Digital Transformation?
Digital Transformation is the mechanism that allows the incorporation of new emerging technologies to complete the digitalization of the business. Also, it includes the capabilities to review and redesign business processes to take benefit of these emerging technologies.
- Data Capturing Technologies: IoT, IIoT, Social Media
- Data Analysis Technologies: Analytics, Artificial Intelligence, Machine Learning
- Automation: Robotic Process Automation, Robotics
- Responding to Events: IoT, IIoT, Artificial Intelligence, Robotic Process Automation
Likewise, if Digital Transformation is about introducing many emerging technologies, why is it so common to think about IoT/IIoT as a key element of Industry 4.0?
What is the Industrial Internet of Things (IIoT)
In essence, IIoT is a new family of devices capable of:
- Sensing a physical variable of a physical asset in a distributed environment.
- Communicating this information to a central site using an IP address.
- Receive messages from the central repository with instructions to respond to these events monitored.
- Execute these instructions to optimize the operation of the physical assets.
Even though all emerging technologies are key for digitizing the business, it is true that having a digital sensor/actuator capable of interacting with a central site is invaluable.
Typical benefits of Industry 4.0
- Operation Efficiency: Events recorded on time, analyzed on time, responded on time. No time waste, no material waste. Product quality protected.
- Self-sustained organizations: Reduced need for human intervention for supporting unplanning interruption.
- Smart Factory: Easy to modify processes to respond to changes in market demands.
Good enough?
What are your thoughts on the subjects raised in this edition of the Digital Acceleration Newsletter?
This is a fascinating topic. We can go deeper based on your feedback.
Share them in the comments below, and if you have ideas about other topics you’d like to see covered in this newsletter, feel free to add those suggestions.