Industry 4.0

The Term Industry 4.0

Industry 4.0 has its roots in the 4th industrial revolution and is a technology-oriented concept mainly for the manufacturing domain but can be interpreted more generally and applied to any value chain organization. The term was introduced by the project Zukunftsprojekt Industrie 4.0 that is a part of the high-tech strategy of the German Federal Ministry for Education and Research (see [Bund_Industrie4.0]). When it comes to manufacturing, Industry 4.0 is often described as the new (fourth) industrial revolution. It also can be considered as a new industry paradigm. In order to understand this new paradigm it is necessary to take a look at the first, second and third industrial revolutions: The first industrial revolution brought the mechanization of production, the second industrial revolution was about mass production and the third industrial revolution means the digitization (electronic component, computer and IT. Industry 4.0 enables suppliers and manufacturers to leverage new technological concepts like CPS (Cyber-Physical Systems), Internet of Things and Cloud Computing (CC): New or enhanced products and services can be created, cost can reduces and productivity can be increased.

How Smart is your business?

In the discussions about Industry 4.0 the term Smart Factory is mentioned quite often and even if the word “smart might be open to debate, it describes the main point in a very short and plain way: The idea is to create a network with decentralized decisions and technological components with enhanced capabilities that can interact with each other and with human in real time. The components are (semi-)autonomous and can be equipped with advanced computing power or AI (Artificial Intelligence). Today, businesses have three options

  1. They can stick on their existing business model and keep their technological infrastructure or
  2. they enhance and advance their business, e.g. using cloud applications, or
  3. they create new business models using full scale Industry 4.0.

It depends on the business goals what option is to be chosen, but it must be clear that Industry 4.0 is not a self-propelling thing and should not be considered without proper consideration and preparation: Implementing and facilitating Industry 4.0 also mean challenges because of the complexity of the systems or system components, e.g. security governance. Introducing sensor-driven computing, developing intelligent machine applications and using cloud platforms require clear business goals and requirements, experts from different disciplines and a professional project and quality management – just to mention a few aspects. Therefore, developing a small show case and a first evaluation are the best first steps in order to gain more information and competence for the next steps towards an Industry 4.0.

Benefit from  Industry 4.0 concepts and products

Almost every business can take advantage of Industry 4.0, e.g. predictive maintenance of vending machines that are in operation at customer's shops: The hours of operation can be sensed over a network and stored in a cloud storage. Together with other data, e.g. from a CRM a cloud application can inform sales and the maintenance department of the status of the machine and suggest maintenance services that are offered to the customer – almost automatically. Industry 4.0 comprises the following terms or technological concepts:

  1. Embedded Systems (ES) / CPS (Cyber-Physical Systems): A network of devices that interact physically with its environment, e.g. industrial robots with sensors and actors need physical input and provide physical output. ES and CPS are can also be equipped with digital interfaces. An ATM is an example for an embedded systems that provides money but also contains an embedded digital computer system.
  2. Internet / Cloud of Things (IoT / CoT): Physical objects or components like ES or CPS that contain software and are connected to a network (Internet connectivity) or a Cloud application create opportunities for new services through integration of the physical and the digital world, e.g. automatic remote control of a surveillance camera. The “things” can be any items that is used in our everyday life, e.g. a light bulb, a car key or a pencil. In the context of Industry 4.0 the term Industrial Internet of Things (IIoT) is also used.
  3. Service-Oriented Architecture (SOA) / Internet of Services (IoS) / Cloud Computing (CC): Service-oriented and cloud-based infrastructures and applications have advantages concerning scalability, elasticity, reliability, performance, device and location independence and more. Service models are for example Metal as a Service (MaaS), Infrastructure as a Service (IaaS), Platform as a Service (PaaS), Software as a service (SaaS). In terms of the deployment Cloud apps can be organized as private, public or hybrid cloud. Open and closed / commercial source products for CC are available (see [OpenStack], [SAP_Hana]).

Important topics like Big Data are also part of Industry 4.0, but in order not to go beyond the scope of this short introduction, the concepts mentioned above are considered sufficient for the understanding of Industry 4.0.


[AMDIS_CSH] AMDIS Media and IT Services: “Cloud Storage Hub” (concept paper) 

[Bund_Industrie4.0] Bundesministerium für Bildung und Forschung, Zukunftsprojekt Industrie 4.0: 

[DBR_Industry4.0] Deutsche Bank Research: Industry 4.0 - Upgrading of Germany’s industrial: capabilities on the horizon: (visited on March 9, 2015) 

[MJames_Icons] Mark James: Silk icon set 1.3, 

[OpenStack] OpenStack, 

[Oracle_cloud] Oracle Corp.: Oracle cloud: Software as a Service, (visited on April 10, 2015) 

[SAP_Hana] SAP AG: SAP HANA Cloud Platform, (visited on May 1, 2015)

[SAP_HCP_CS] SAP HCP Connectivity Service, 

[SAP_HCP_OData] SAP HCP HCI OData Provisioning, 

[SAP_HCP_PS] SAP HCP Persistence Service, 

[Wiki_Industry4.0] Wikipedia 

[ZVEI_Industry4.0] ZVEI, VDMA, BITKOM : Das Referenzarchitekturmodell RAMI 4.0 und die Industrie 4.0-Komponente,