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National Manufacturing Month: Overview of Industry 4.0

October is National Manufacturing Month. In addition to however else you may be celebrating this month, I hope you take some time to read our upcoming manufacturing blog posts which will be posted each week in October. Our first installment provides an overview of Industry 4.0.

You can’t look at a manufacturing blog or magazine today without coming across several articles on the topic of the fourth industrial revolution, or “Industry 4.0.” Most stories highlight one particular technological innovation; however, Industry 4.0 is much broader than what is oftentimes covered. This article will look at what Industry 4.0 is and how it will affect your business.

Overview of Industry 4.0

Industry 4.0 has been a buzzword in manufacturing for over five years, and the technology within this umbrella term is still evolving. The term is generally used to capture the shift from the third industrial revolution, when computers were first integrated into the manufacturing process, to today’s manufacturing landscape which is categorized by interconnectivity, big data, advanced analytics, artificial intelligence, robotics, and more. Here is an overview of the more common technologies used in today’s smart factories:

Internet of Things (IoT) Much of Industry 4.0 is dependent on getting massive amounts of real time data. That is possible thanks to IoT technology which utilizes sensors to be the eyes and ears throughout the manufacturing process.
5G The next generation of wireless technology is 5G, which is up to 10 times faster than 4G. The increased use of sensors requires high-speed, low-latency connections to send large amounts of data, which is why 5G is critical to a smart factory.
Cobots Unlike tradition robots, collaborative robots (“cobots”) work alongside humans and will account for approximately 30% of industrial robots within the next 5 years. Most small and medium sized enterprises do not want to invest the time or resources in robots, so they have opted for cobots for tasks such as picking, packaging, and assembly.
Machine learning Machine learning (“ML”) is a subset of artificial intelligence. With ML technology, machines learn from data, identify and even anticipate patterns, and then make decisions. ML is the epitome of one key aspect of Industry 4.0 – i.e. more informed decisions being made quicker and with less human effort.
Additive technology More commonly known as 3D printing, additive technology has taken off in the manufacturing industry. Design engineers use additive technology to create functional prototypes. This is also used in small batch manufacturing or custom orders.
Digital twins Connected sensors throughout the plant floor allow for the creation of a digital mapping of the manufacturing process (a “digital twin”). Then, utilizing virtual reality technology, companies can experiment with hypothetical operational workflow arrangements without having to shut down the plant.

Effect on Your Business

If you agree with the 83% of manufacturers surveyed who believe these technologies will transform the way products are made in five years, then you probably have already begun to look into adopting one or more of the key technologies in Industry 4.0. Whether your goal is to become a smart factory or you’re just looking to keep up with the times, there are a couple of things to consider outside of the technology itself.

First, the technology noted above, and the sophistication of newer machines will require upskilling your current workforce, recruiting new employees with the right skillset, or, most likely, both. This is no small task, as skilled labor in manufacturing is already a big enough challenge. However, when done correctly, upskilling can help with staff retention as employee’s responsibilities are elevated, they are performing less mundane tasks, and their compensation will reflect that. Similarly, recruiting new employees for technical roles in the manufacturing process is attractive to the younger generation who, by and large, do not gravitate toward more traditional manufacturing jobs.

Lastly, while the increased use of technology in your manufacturing process introduces significant efficiencies and savings, it also introduces new cybersecurity concerns. It is critical to have your cybersecurity team involved in the implementation and ongoing monitoring of these technologies.

“Enhanced exploitation tactics and techniques will be used to target supply chains and then make their way down to the OT and edge devices, hitting multiple attack surfaces at once. Organizations must be able to identify, monitor and protect digital assets in the Industry 4.0 era.” – Yevgeny Dibrov, Forbes Technology Council Member

Our cybersecurity team is experienced in assessing risks and designing controls to mitigate the risk that bad actors will disrupt your business. Please reach out to a member of our cybersecurity team for more information. For more information regarding our manufacturing experience, be sure to visit our Manufacturing Services page and don’t hesitate to reach out to a member of our manufacturing team.

About the Author

McKonly & Asbury

McKonly & Asbury is a Certified Public Accounting Firm serving companies across Pennsylvania including Camp Hill, Lancaster, Bloomsburg, and Philadelphia. We serve the needs of affordable housing, construction, family-owned businesses, healthcare, manufacturing and distribution, and nonprofit industries. We also assist service organizations with the full suite of SOC services (including SOC 2 reports), ERTC claims, internal audits, SOX compliance, and employee benefit plan audits.

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