What Is Industry 4.0, Anyway?
Ian Wright posted on February 22, 2018 | | 14049 views

“You say you got a real solution

Well, you know

We’d all love to see the plan.”

– The Beatles

The four industrial revolutions.

The four industrial revolutions: (1) Mechanization through water and steam power. (2) Mass production and assembly lines powered by electricity. (3) Computerization and automation. (4) Smart factories and cyber-physical systems.

If you’ve been to a trade show or read an op-ed on manufacturing in the past few years, chances are you’ve seen the terms ‘Industry 4.0’ and ‘fourth industrial revolution’. Depending on whom you ask, these connote a fundamental shift in the global manufacturing sector or empty buzzwords dreamt up by marketers and PR firms. Not surprisingly, the truth lies somewhere in between.

“Are they buzzwords? Yes. Are they just buzzwords? Absolutely not,” said Joel Martin, laser tracker product manager for Hexagon Manufacturing Intelligence.

Make no mistake: the manufacturing sector is in the midst of a sea change, though its final outcome is far from certain. Right now, there are still more questions than answers:

  • What is Industry 4.0?
  • What’s the difference between a “smart” factory and a dumb one?
  • Is the fourth industrial revolution only for large original equipment manufacturers (OEMs), or can small or medium-sized enterprises (SMEs) also benefit?
  • How will this affect the skills gap?

And, most important of all:

  • When does the revolution begin?

Engineering.com sat down with industry experts in an effort to answer these questions and get their unique perspectives on the next industrial revolution. But first, a little history.

Exactly How Many Industrial Revolutions Have We Had?

If you haven’t been paying much attention to the last century of industrial history, you might be forgiven for thinking that we’ve only had the one revolution: in the time period between 1760 and 1840. This represents the transition from skilled artisans making goods by hand to (relatively) unskilled workers using machines powered by a water wheel or steam engine. The transition was most prevalent in the textile industry, but the effects of the first industrial revolution were eventually felt in almost every aspect of daily life.

Machine works in Chemnitz circa 1868.
Machine works in Chemnitz circa 1868.
That was Industry 1.0, and we’re on our way to Industry 4.0, so what about versions 2.0 and 3.0?

The second industrial revolution took place over the end of the 19th century and beginning of the 20th from about 1870 to 1914 and the beginning of World War I. Unlike the first industrial revolution, which was characterized by the advent of new technologies, the second industrial revolution had more to do with improving existing technologies and the synergies between them.

For example, electricity replaced water and steam as the primary power source in factories. The second industrial revolution also marked the beginning of the assembly line, interchangeable parts and, with them, mass production.

The third industrial revolution, like the first, saw the introduction of disruptive new technologies—in this case, automation and the computer. These advancements brought about monumental changes to manufacturing, enabling levels of precision (thanks to industrial robots) and accuracy (thanks to Computer Numerical Controls (CNCs), never before seen on the shop floor. Pinpointing the time period for the third industrial revolution is tricky, because—at least on some accounts—we’re still in it, but the beginning can be traced to the early 1960s, which saw the introduction of the first industrial robot and first commercial CNCs.

Industrial Revolution

Time Period

Core Aspects


1760 – 1840



1870 – 1914

Mass Production


1960 – 20??





What Is the Fourth Industrial Revolution?

If we take a broad view of the last three industrial revolutions, a pattern emerges.

Workers on the first moving assembly line put together magnetos and flywheels for 1913 Ford automobiles.
Workers on the first moving assembly line put together magnetos and flywheels for 1913 Ford automobiles.
The odd-numbered revolutions were the apparent result of disruptive new technologies, e.g., the steam engine or computer. In contrast, revolution 2.0 had less to do with the invention of new technologies than with enhancing the synergy between them. If the pattern holds, we should thus expect Industry 4.0 to involve more optimization than invention.

Granted, this inference is based on a paltry sample size (and we can’t exactly run simulations or controlled experiments with industrial revolutions), but it does have some support within the industry, as Jason Urso, CTO for Honeywell Process Solutions, explained:

“We invented digital control systems 35-40 years ago for the purpose of connecting tens of thousands of sensors to a digital control system. So, 35 years ago, we started the journey toward the Industrial Internet of Things [IIoT].

“If I look at the next major generational shift that occurred, it was probably in the early 2000s timeframe, with the advent of open systems and more advanced applications. Building a suite of software on top of existing control systems allowed us to make even better use of all the data that had been collected in the control systems from those tens of thousands of sensors and actuators within the four walls of the plant.

“That created yet another wave of significant benefits for our industry. I think we’re now in this next wave, which is often called Industry 4.0, but I see it as building upon those prior steps.”

Urso is describing a popular view regarding Industry 4.0 and social/economic revolutions in general, i.e., they occur gradually over a long period of time. That’s why you’ll often hear experts reframing the concept of a fourth industrial revolution in terms of a fourth industrial evolution. The claim is not that there are no great leaps in manufacturing technology, but rather that their impact takes time to be felt across the entire sector.

Rover 200 framing line taken in the 1990s.
Rover 200 framing line taken in the 1990s.

Gordon Styles, president and CEO of Star Rapid, a provider of rapid prototyping, rapid tooling and low-volume production services, summed up this point nicely:

“Every now and again, there’s some fundamental shift that happens, then becomes a trend and eventually becomes mainstream. That’s how we got to mechanization and mass production, and now computers and automation. We’re seeing a transition from having machines with computers in isolation to machines with on-board computers that are communicating or being controlled from other computers. And it’s not something that happens overnight—obviously it’s something that has gradually come about as devices have become more connected.”

John Kawola, president of Ultimaker, North America agreed with Styles regarding the incremental nature of industrial revolutions, though he was cautious of the hype surrounding Industry 4.0:

“I don’t know if those terms [Industry 4.0 and the fourth industrial revolution] have meaning. I do think the digital age has moved into manufacturing and is starting to have a real impact. That’s already happened—whether it’s robotics, tools, sensors or IOT technology that keeps track of everything in an automated way.”

Kawola also suggested an economic explanation for the proliferation of digital technologies on the shop floor.

“I think it’s because the cost of technology is coming down,” he said, “whether it’s software or robots or 3D printing. As costs come down and as materials, surface finish and the integrity of printed parts start to approach what you can do using traditional manufacturing methods, more and more 3D printing will be used for more and more manufacturing. That’s happening now.”

Smart Factories of Industry 4.0

Picture this:

The year is 2048. It’s time for your quarterly on-site visit to the plant. Your driverless taxi drops you off in front of a large industrial building. You step inside the factory of the future and see … what?

Artist's conception of GE's
Artist's conception of GE's "brilliant" factory, currently under construction in Welland, Ontario. (Image courtesy of GE.)
The smart factory, also sometimes called “the factory of the future” is the keystone of the fourth industrial revolution. Indeed, it’s often represented as the aggregate of all the Industry 4.0 technologies: cyber-physical systems—physical assets connected to digital twins—the Industrial Internet of Things (IIoT), data analytics, additive manufacturing and artificial intelligence.

But what does that actually look like?

How will the smart factories of Industry 4.0 differ from the “dumb” factories of Industry 3.0?

“If a factory is producing a quality product, the processes are tuned, the supplier channel is correctly monitored and everything is running like a well-oiled machine,” Martin said. “I think that factory today and the factory of the future are, quite frankly, going to look very similar.”

This goes back to the point about Industry 4.0 being more about optimization than invention, as Martin explained: “The reality is that it’s very seldom for any factory to work like a well-oiled machine. If you walk into a factory today, what do you see? A group of engineers huddled around a problem, brainstorming. ‘What is this? How did it happen? What the hell do we do to fix it?’ In the factory of the future, you’re going to see a computational database spitting out not just, ‘Hey, you have a quality problem,’ but ‘Hey, here’s the solution to your problem,’ and, hopefully, in the larger scope of things you don’t even see it.”

Urso agreed that optimization is the watchword for Industry 4.0, emphasizing the role that big data analytics will play.

“If you think about it in the medical industry,” he explained, “a doctor gets really skilled by seeing many patients over a long time. That enables them to build a strong mental model about what symptoms lead to what medical condition. And that’s what we’re doing: trying to increase the number of patients we’re seeing.”

However, rather than increasing instrumentation inside individual facilities, the key is to improve the interconnections between separate facilities, as Urso explained:

“We have pretty significant instrumentation already, given the first wave of technology that was introduced with digital control systems, but the problem was that the data was always encapsulated within the four walls of a plant. Allowing that data to come to a central repository—in a cloud environment, for instance—where it can be shared across many plants is what gives us an advantage. That, to me, is what Industry 4.0 is all about.”

Returning to the question of what differentiates smart factories from dumb ones, the answer on a case-by-base basis seems to be, “Not much.” That’s because the biggest difference between the dumb factories of today and the smart factories of tomorrow isn’t what’s inside them, but rather the network that connects them. As an analogy, consider the difference between having a home computer and having one connected to the Internet: even if the machines have identical hardware, the latter is obviously far more powerful.

SMEs in The Fourth Industrial Revolution

So, if the smart factory is the centerpiece of Industry 4.0 and the defining characteristic of a smart factory is its interconnections with other factories, the logical question to ask is whether the benefits of the fourth industrial revolution will be reserved only for large enterprises with multiple facilities.

What about SMEs?

There are two answers to this question.

First, it’s worth noting that even single-facility enterprises can potentially benefit from the sort of information sharing described above. Consider a simple case: A shipment from an SME’s cutting tool supplier will be delayed due to severe weather conditions. That information is relayed to the SME’s manufacturing execution system (MES), which directs its machining centers to reduce their speed and feed rates to decrease the chances of too many tools breaking before the shipment arrives. The point is, even if you only have one factory, you can still benefit from having that factory digitally connected to the rest of your supply chain.

Stratasys' vision of the factory of the future. (Image courtesy of Stratasys.)
Stratasys' vision of the factory of the future. (Image courtesy of Stratasys.)
The second, and more important answer to the question of whether SMEs will be able to reap the rewards of Industry 4.0 points to a trickle-down—and sometimes trickle-up—effect of production technology. Take additive manufacturing, for example.

“Some of the early success stories for 3D printing were the ones about low-cost, custom applications,” Kawola said. “If you’re trying to make a million of the same thing, you’re not using 3D printing. But, if you’re a lab making dental appliances and they’re all different, you can print the whole run.”

“That’s looking at it from one direction,” he continued, “but with costs coming down and part quality going up, 3D printing is starting to find its way into those larger-volume applications. GE’s gone all in on this, and they’ve found all sorts of value in taking an assembly that used to have 16 parts and printing it in one piece. It took them a couple of years to develop and qualify it—it probably took the industry a few years to catch up to give them the performance they needed in terms of the properties of the alloys—but now they’re finding all these aerospace applications where printing is more cost-effective and you get better parts.”

We’ve seen this trend before in previous industrial revolutions. Industrial robots and CNCs used to be found only in the largest and most sophisticated facilities, but now they’re a common sight in factories and job shops across the sector. The reason is obvious: return on investment (ROI).

“If the big companies get spoken about more frequently, it’s probably because there’s bigger numbers associated with their savings and outcome opportunities,” Urso said. “But for smaller locations, the same percentage benefit is possible and, in fact, some of the technologies that would have been very expensive to deploy at a small customer’s location can now be deployed using cloud technology and on a subscription basis that is very closely linked to the outcomes they are going to generate. So, a small site might be able to take advantage of technology that previously was only really affordable by a larger customer.”

So, the answer to question whether SMEs will benefit from Industry 4.0 seems to be, “Yes,” though with the qualification that they may take some time, if previous revolutions are any indication. On the other hand, the pace of change in industrial revolutions does seem to be accelerating: Industry 1.0 arose over a period of 80 years and Industry 2.0 in a little more than half that time. The pace of change with automation and CNC in Industry 3.0 should be recent enough to be obvious. Regardless, one thing is certain: the pace of Industry 4.0 will be set by SMEs. 

New Developments in Manufacturing

Nothing defines an industrial revolution better than the technology involved, so it’s worth considering what to expect from the machinery and software of Industry 4.0. Given the sheer scope of technological change entailed by an industrial revolution, covering every new development in a single article is impossible. Instead, let’s focus on two areas in particular: additive manufacturing and the IIoT.

Additive Manufacturing in Industry 4.0

Bridge manufacturing using an Ultimaker 3 print farm. (Image courtesy of Ultimaker.)
Bridge manufacturing using an Ultimaker 3 print farm. (Image courtesy of Ultimaker.)
As a technology, 3D printing has seen incredible advancement over the past decade, steadily progressing from prototyping to production and other applications. Metal additive manufacturing is particularly promising as a production technology, and its efficiency is only improving. As a user of additive manufacturing, Styles agreed that it’s the developments in this area that excite him most.

“I’ve been very excited to see Desktop Metal’s progress making metal parts. That’s actually an old technology they’re using—which isn’t uncommon, companies using technologies that have been around for a while but overcoming some previous limitation—but in this case they’ve overcome the problem of shrinkage. Binding of metal powders together to make a pre-sintered part and then putting it into a sintering oven, where its volume reduces by, say, 50 percent, which gives you an approximately 30 percent reduction on one of the axes. This has been going on since the mid ‘90s. These systems have existed since then, but the reason they’ve never been sold commercially is that no one could overcome the problem of shrinkage. That’s what Desktop Metal has done.”

Despite his enthusiasm, however, Styles was quick to note the limitations of the technology.

“If you’re in medical, aerospace or toolmaking, Desktop Metal is not for you. You need very high densities, on the order of 99.8… or 99.9… The system that I have—Renishaw—as well as EOS and Concept Laser, can provide that. The best Desktop Metal can do is about 98 percent density, but that’s okay as long as you don’t need very high-density parts. But that’s a very big market, and I think Desktop Metal is going to open it up. I predict huge expansion in use of metal 3D printing over the next few years.”

3D-printed wheel protection jig produced in a fraction of the time and at a fraction of the cost of external suppliers. (Image courtesy of Ultimaker.)
3D-printed wheel protection jig produced in a fraction of the time and at a fraction of the cost of external suppliers. (Image courtesy of Ultimaker.)

From the perspective of a supplier, Kawola noted the advancements that have been made in 3D printing materials in general:

“If you go back to the earlier days of 3D printing, you had a handful of companies with a business model that was essentially, ‘Here’s the machine, here’s the software and here are the materials,’ and the materials were generally closed, i.e., proprietary. Obviously that’s a beautiful business model for those companies, but now, with the next wave of 3D printing companies, which includes Ultimaker and HP, our strategy is to be more open with the materials you can use. That’s opened the floodgates for the major plastics companies of the world to get into this market. As a result, the pace of development in new materials and the pace of innovation has greatly increased.”

Once again, the fourth industrial revolution proves to be more about optimization than innovation. In the case of additive manufacturing, it’s a matter of improving production and post-production processes—like heat treatments—and materials, or more accurately, material selection.


The Internet of Things in Industry 4.0

(Image courtesy of Honeywell.)
(Image courtesy of Honeywell.)
The IIoT is a complicated topic, one that warrants a feature of its own. Connectivity plays a major role in the fourth industrial revolution, both within and across its smart factories. Urso offered the following example of how that might play out:

“We provide process licenses for large pieces of equipment at refineries and petrochemical plants that, in essence, run their processes for converting petroleum into other chemicals. The challenge is always that the technology is optimized when it is delivered but needs to be operated in a particular way to maintain that level of optimization over a period of time. It can be challenging for customers who don’t all have the skills to ensure that those pieces of equipment are constantly optimized.

“By connecting that equipment up to Honeywell’s cloud environment, we’re able to monitor its performance against its nameplate capacity and identify instances where it’s starting to degrade. More than that, we can very clearly understand the reason why it’s happening and provide an advisory service to the customer to make a change.”

(Image courtesy of Honeywell.)
(Image courtesy of Honeywell.)
This sort of predictive maintenance enabled via the cloud is exactly the sort of optimization that comes with the fourth industrial revolution. By taking production data beyond the four walls of plant, manufacturers will be able to eliminate unplanned downtime across their facilities and gather insights for improving efficiencies beyond what’s been previously possible.


The Skills Gap and Industry 4.0

Despite all the optimism that comes with the future of manufacturing, there are good reasons to be concerned, too. Chief among them is the so-called skills gap. According to analyses from Deloitte, there will be 3.5 million job openings in manufacturing over the next decade but only enough skilled labor to fill less than half of them.

With 2 million jobs potentially unfilled, there have been many proposals for upskilling the workforce in short order. Efforts to attract more millennials to take up careers in manufacturing—for example, by using social media—have met with some success, but what if the real solution to the skills gap is a technological one? To be clear: this isn’t meant to imply the kind of “automation-run-amok” hyperbole that’s often found in the outsider’s perspective.

(Image courtesy of
 NIST engineer Jeremy Marvel adjusts a robotic arm used to study human-robot interactions. (Image courtesy of Fran Webber/NIST/)
“What I don’t think we’re going to see is robots replacing humans across all of these different industrial processes,” said Martin. “There’s a dozen different reports from different institutes and organizations predicting that as artificial intelligence and the utilization of collaborative robots grows, it will actually increase the workforce, rather than decrease it. Of course, that will require a different skillset than what we have today.”

Urso agreed, emphasizing the role new technologies can play in helping to develop that skillset:

“I think the tools we have to educate and empower people today are unparalleled: being able to provide a field worker with a digital set of procedures that walks them through the steps they need to perform, being able to use augmented reality to see how equipment is performing as you’re standing in front of it, using virtual reality to train on a procedure even 10 minutes before you perform it. The tools available really are unprecedented and they’re helping us address that competency gap.”

To return to the analogy with consumer goods, consider how overwhelming it can be for someone to switch from a dumb phone to a smart one. The traditional physical keypad is gone, the simple interface replaced by scores of indecipherable icons for apps. How are we supposed to figure out how to use this thing if we can’t even call someone for help? The answer, of course, is in the phone itself: once you figure out how to google user manuals or pull up YouTube tutorials, you’re off and running.

So too with the fourth industrial revolution: the tools for handling it are part of the revolution itself.

The Fourth Industrial Revolution

We’ve answered four of the five questions with which this article began, but there’s still one lingering:
  • When does the revolution begin?

Unfortunately, if you’re hoping for something like a date to plug into your calendar, you’re going to be sorely disappointed. It helps to remember that the dates for previous industrial revolutions are merely approximations—it’s not as though on Jan. 1, 1760, there was some official declaration that the industrial revolution had begun. Revolutions on this scale are never so simple.

Rather than worrying about when Industry 4.0 begins, consider asking yourself a different question:

  • If the fourth industrial revolution begins tomorrow, will I be ready?

For more information on Industry 4.0, check out our feature-length articles on augmented reality, the Industrial Internet of Things and metal additive manufacturing.

Recommended For You