Industry 4.0: ten years on

Posted on 18 Oct 2022 by The Manufacturer

It’s been just over a decade since the launch of Industry 4.0 at Hannover Messe. So, what has changed? Has the vision of the 4th Industrial Revolution been delivered, and do we need to consider how the last decade will shape the future of manufacturing? We speak to Professor Rab Scott, Director of Industrial Digitalisation at the University of Sheffield Advanced Manufacturing Research Centre (AMRC), to find out more.

What has changed since the launch of Industry 4.0?

Professor Rab Scott, Director of Industrial Digitalisation at the University of Sheffield Advanced Manufacturing Research Centre (AMRC)

When Industry 4.0 was first proposed there was a dystopian view that humans would be replaced by robotics, with the factory of the future having far fewer employees than we do today. That hasn’t come to pass. In fact, there was a 2015 report by Deloitte that identified that while 800,000 jobs had been lost to automation, more than three million had been created. And those roles were worth around £10,000 more than the ones they displaced. So, we’re seeing a drive for upskilling into higher value jobs.

An emerging trend is that data is now the new oil, but like oil, it needs refining to become valuable. If you don’t do anything with data, then it has no value and becomes a cost. This is a trap manufacturers continue to fall into; they know data needs to be collected, but not what to do with it. And they don’t necessarily know what value they’ve got in the data they’ve collected and where to go for help.

The sheer volume of data is muddying the waters. People talk about AI and machine learning, which is all very well, but taking advantage of such technology must start with the correct data being collected in the right way. That’s data engineering rather than data science. Unfortunately, those sorts of skills aren’t necessarily being trained within a manufacturing context.

We need to start teaching young people about the use and value of data at primary school level. We can’t put the technology on a pedestal as something only accessible to the few due to the skills required to work in that space. We’re seeing a lot of tools being commoditised, but we’ve got to get people thinking with a data-centric mindset; that’s absolutely key.

A plethora of technologies have arrived on the factory floor, but many are still siloed because of the challenges around connectivity and cyber security. Some are still stuck in proof-of-concept, or pilot purgatory, and struggle to progress beyond that phase because the broader adoption of such technologies across the enterprise has not been considered.

It’s true that some manufacturers are accelerating technology deployments and identifying the benefits; and the pandemic actually helped with that, because it enabled some companies to pivot quite quickly into the digital age. However, others have struggled to start that transformation journey, have become bogged down with proof-of-concepts, and continue to wrestle with three fundamental questions that still need to be answered around skills, ROI and security.

As far as skills are concerned, we’re at a tipping point, as we are going to be the only generation that transitions from analogue into digital. So, the sector is looking around for the skills to make that happen. In the future, digital will be implicit, not explicit for manufacturing and the skills to enable that will be vital.

There is still a huge question around return on investment. Manufacturers considering investment in digital technologies want to know what they are going to get back and when. Unfortunately, the companies that have already adopted and embraced transformation view it as a competitive advantage, so they tend not to broadcast how they are saving money, time, and what is enabling them to be more productive.

In addition, due to what’s happening in Ukraine, the cyber threat has never been bigger. The protection of national infrastructure is absolutely key. And while that’s traditionally been transport, utilities and power, manufacturing is beginning to be mentioned in the same breath due to the contribution it makes to Gross Domestic Product (GDP).

At Manufacturing Leaders’ Summit (MLS), Professor Rab Scott will look at the current global challenges, emerging technologies, the skills required, the challenges the supply chain will face, and how manufacturers can overcome these hurdles.


*Tickets are for manufacturers only.

What gaps need filling to make the Industry 4.0 vision a reality?

The Made Smarter National Adoption programme is helping companies to understand the value of Industry 4.0 and to start their journey; but the impact of the program is slow to be realised. There’s still a lot of hype clouding the landscape, but if you distil the concept down to its fundamentals, the core of Industry 4.0 is about reduction of non-value added activity.

Ultimately, people and organisations need places where they can go and see this happening to have that light bulb turned on. This is where the High Value Manufacturing (HVM) Catapult and other research and technology organisations (RTOs) really have a role to play in becoming demonstration sites where people go to see what’s relevant to them without being ‘sold to’. If it’s a question of selling the technology, quite often the best salesman, and not necessarily the best technology, wins out.

What impact has global challenges had on Industry 4.0?

When Industry 4.0 was rolled out, it was solely about productivity. Now it includes the whole net zero and environmental, social and governance (ESG) agenda; this is a positive move. It’s not just about the bottom line anymore, it’s also the generation of wealth, and by that I mean mental wealth as well as financial wealth.

This means giving people jobs in which they’re valued and allowing them to adopt technology to improve the quality of life in their workplace. All of these impact on net zero; if you improve quality and reduce your waste streams, you improve productivity while having a positive impact on net zero – the two go hand-in-hand.

The question then, of course, is whether we are merely going to manufacture more parts using the same amount of energy? That could potentially happen so this is where manufacturers have to become socially, as well as environmentally and economically, responsible. But we’ve certainly seen a pivot away from being purely productivity focused towards climate change and ESG.

Comparing the landscape at the dawn of Industry 4.0 with now, in the present climate there are very few technologies that are being allowed to mature slowly. There is a definite fail fast mentality coming into manufacturing, because people are willing to experiment, and simply move on if something is unsuccessful.

Technology is absolutely integral to this ethos and to where we have to bring the digital and manufacturing ecosystems together. Currently they’re still not completely aware of the opportunities that lie within each other.

How has the skills challenge impacted Industry 4.0?

I don’t think that we are providing fit-for-purpose people coming out of the education system. We are still teaching in Victorian ways. Yes, we might be using tablets and screens, but what’s fundamentally changed? Essentially the process is paper on glass. We need to be looking at more challenge and problem-driven educational systems.

There is a huge challenge facing all manufacturing – the recruitment of people with the appropriate skills. This is primarily because of the salaries which can be demanded in other fields, such as fintech, using similar digital capabilities. For the people with the skills manufacturers need, there are, unfortunately, opportunities elsewhere.

The answer, I believe, is to start upskilling our manufacturing workforce. And that’s got to start within the apprenticeship realm, because those are digital natives and people who are committed to manufacturing, and we should be giving them the tools they need. Ideally, that journey would have started in secondary or primary school, but let’s start with the people who are already in the sector.

Continue the conversation with Professor Rab Scott at Manufacturing Leaders’ Summit (MLS) this November 16 and 17 in Liverpool, where the key theme will be sustainable growth through digitalisation. Over the two days we will be covering key strategic, business and technical challenges across the manufacturing ecosystem – with maximum opportunity to network, debate and engage with your peers.


*Tickets are for manufacturers only.

What’s the importance of transparent supply chains?

More and more, companies are being driven by the net zero and ESG agendas and going forward, that means the way supply chains transact will have to change. That will mean a change of mindset will be required among manufacturers. For example, we now need to be far more open to sharing data; data has traditionally been held back because it represents an organisation’s USP. In reality, if data is shared, then huge opportunities and benefits can emerge, because areas of collaboration that didn’t exist previously are all of a sudden opened up.

To do that, however, we’ve got to have the capability and tools to be able to share that data securely and to trust the data that’s being shared. There are two levels of trust – the trust that the data hasn’t been intercepted and corrupted during transfer, but also the trust that the original capture of that data is being done in a proper and correct way.

So, we’ve got to trust the transmission of data and its use in making decisions. As we move towards the net zero agenda everyone is getting worried about Scope 3 emissions. However, your Scope 3 emissions are someone else’s Scope 1 and 2. So, we need to start capturing Scope 1 and 2 in a robust, repeatable way, but then also be open to sharing it.

What does the future of manufacturing look like?

In the short-term, there are huge opportunities for companies that are willing to digitalise. There will have to be mindset change, however, and I don’t know when this is going to happen. A key part of the future vision from the perspective of a large volume manufacturer is to be able to reconfigure quickly to perform small batch production and increase agility and flexibility. But where does that leave the small companies that are currently filling that space? They’re going to have to reinvent themselves.

More and more manufacturers will need to shift from a sole focus around the products they create, and look carefully at the upstream supply chain and the downstream product in service; that’s what will drive new business models and new ways of working. I think that we’ve got the manufacturing base in the UK that can embrace those sorts of changes and really benefit from them.

At Manufacturing Leaders’ Summit (MLS), Professor Rab Scott, Director of Industrial Digitalisation, University of Sheffield Advanced Manufacturing Research Centre (AMRC), will look at the current global challenges, emerging technologies, the skills required, the challenges the supply chain will face, and how manufacturers can overcome these hurdles.