Before we can talk about what Industry 4.0 is, we need to understand what exactly the name refers to. As its name implies, it has something to do with industry, but what exactly is it that it has to do with and what industry are we talking about? The word industry is a very general term that we should probably qualify before getting too far into this conversation. Also, we should probably clarify: what is it that this is the 4th iteration of? All of these are very important questions that we should answer before we move on.

What aspects of Industry is it about?

The “industry” in Industry 4.0 speaks to the manufacturing process and all of the links in the supply chain that get products from raw materials to a box with a smiley face on your front porch. We don’t typically think of this when we order something online, but there is a whole host of stops along the supply chain that have to work just right in order for that widget, however insignificant it might be, to be manufactured, warehoused, shipped, and delivered to our door. It’s a testament to the industry as a whole that this works as well as it does without the types of systems that we will be talking about.

What is this the 4th version of?

When we hear the term “Industry 4.0”, some of us might feel like we’re learning about a great show on Netflix that everyone has been raving about and we’re just now hearing about it. You mean to tell me it’s already in its fourth season? What have I missed? Maybe I can binge watch it this week and catch up. Ok, let’s do just that.

First of all, the 4.0 in Industry 4.0 speaks to the fact that there have been three major revolutions in the manufacturing industry before this one. Thus, the current revolution is the 4th in the history of manufacturing.

Industrial Revolutions

  • Industry 1.0 – The mechanization of production and the utilization of water and steam power.
  • Industry 2.0 – The introduction of mass production, the assembly line, and the use of electricity.
  • Industry 3.0 – The adoption of computers, automation, and human controlled/programmed cyber-physical systems.
  • Industry 4.0 – The introduction of autonomous cyber-physical systems that are self-aware, self-diagnosing, and self-predicting fueled by data and machine learning.

Key Principles


The ability for web-enabled components (machines, devices, sensors, and people) to communicate with each other. This could be via the internet of things, internet of systems, or internet of people. This is the main principle that drives all of the principles in this industrial revolutions.

Information Transparency

The interconnectivity and the vast amounts of data collected by these devices/people allow operators to collect immense amounts of data from all points of their manufacturing process. This allows them to identify key areas of concern as well as areas that can be improved, or innovated. In general, the more data collected by the system, the more data that is available to the operators to make informed decisions about the system. This is critical to improving, optimizing and eventually automating that system.

Technical Assistance

With more and more intelligent systems being built every day, we are now able to provide technical assistance to people in the industry in a couple of different ways. First of all the access and visualization of the vast amounts of data being collected by the system allows the operator to make better, more informed, decisions faster than ever before. Secondly, the advent of cyber-physical systems means that we are now able to have these system aid humans in performing all kinds of tasks that are unpleasant, exhausting, or unsafe.

Decentralized Decisions

The ability for cyber-physical systems to make decisions on their own and to perform their tasks independently without having to be controlled by humans. In this environment, only exceptions, interference, or conflicting goals need to be elevated to require human interaction. Imaging a fleet of cyber-physical systems (robots) fulfilling orders in a warehouse, making decisions on the fly based on the location of the item they are looking for and the location and route of other cyber-physical systems in their way.

Is it really a Revolution?

There is some debate as to whether Industry 4.0 is really a revolution. Revolution implies a drastic change from the previously accepted normal state. Naysayers would argue that technologies normal state is to change and the rate of change is faster than any other industry we’ve ever known. So to call it a revolution, in their opinion, it to imply that it wasn’t supposed to happen given the normal state of the industry. That, they say, is a fallacy because of the nature of technology, and industry these days. That is, that it is natural for technology to be constantly changing and advancing at a rapid rate. Thus, it is not revolutionary to have these advances…it’s just the nature of the industry.

Well, we are just going to have to agree to disagree with these people. The critical piece that I believe makes it a revolution is the learning, awareness, and cognitive aspects of the shift in the industry. That is, the fact that we’ve gotten to a point where we can build systems that learn on their own, are aware of themselves and others around them, can self-diagnose, and make decisions is a huge shift in the “normal” state of the industry. It is, in fact, a revolutionary shift to the way things have been done up until now.

What does this all mean?

The main principles of the Industry 4.0 revolution have sweeping impacts on the way factories, warehouses, and other entities along the value chain of industry function.

Smarter factories

Before this shift in the industry, we had tools available to provide insights into the equipment effectiveness so that operators could identify the root cause of problem or faults in the system. Now we have self-aware, self-diagnosing, and self-predicting system that are interconnected and can independently identify the root cause of issues and faults. That means that they can also learn and make decisions that allow them to resolve the issues, or prevent them altogether, in real time.

It also means that factories will be more efficient, productive and less wasteful. The access to all of the data collected by the system means that the factory system can make decisions that positively affect all of these areas.

No more isolated networks

Historically, factories, warehouses and other physical structures along the supply chain have been isolated in that their networks were constrained to the physical structure that they were in. In the Industry 4.0 world, the isolated network is a thing of the past. Interconnectivity is critical to the success of the supply chain. More and more, these networks will be interconnected, until everything is connected with everything else. This will mean that the complexity of the, once isolated, networks will increase drastically and the security concerns that interconnectivity introduces will become an even more important consideration than it has historically been.

What are the current challenges?

  • Security
  • Reliable Interconnectivity
  • Robust infrastructure and software
  • Protecting IP
  • Lack of skilled workforce
  • Stakeholder adoption
  • Loss of jobs
  • Large financial investments
  • Lack of regulation, standards, certifications

Key Technological Concepts

  • Cyber Security
  • Big Data
  • Data Analytics
  • Artificial Intelligence
  • Machine Learning
  • Cloud Computing
  • Internet of Things (IoT)

We’ll be diving more into these technological concepts and challenges in future posts. Keep an eye out for them in the coming weeks. If you’re interested in joining the revolution, visit our Academy’s Full Stack Immersive page.  There you will learn more about our program which will help get you started on your way to being part of this next phase in the industry.