The first industrial revolution arrived with the steam engine, around the year 1760, and ushered in an era in which machine power came to dominate the production of goods. The second industrial revolution began soon after the first one ended, around 1870. This era saw the rise of standardization and interchangeable parts and culminated in Henry Ford’s moving assembly line in 1913. The third revolution began with the invention of the computer, and radically changed how knowledge work is done. Now we’re on the cusp of a new revolution, brought about by the integration of computing into all facets of the manufacturing process, and leading to the rise of the smart factory.

Each of these revolutions is characterized by speed. The first helped get goods to market faster. The second helped build those goods faster. The third sped up the management of goods and markets. And now the fourth will once again speed up business—by making the journey from product concept to finished good faster. Like the revolutions that came before it, this fourth industrial revolution—aka Industry 4.0—is set to change the way work gets done and products get made.

Industry 4.0 and the Smart Factory

At its core, the smart factory is an outgrowth of the Industrial Internet of Things (IIoT) and “cyber-physical” systems, which use computer-based algorithms to monitor and control manufacturing robots and machines, and even drive vehicles. These technologies also enable smart inventory control, which is changing the warehouse and tightening the connection between engineers and the factory floor.

Industry 4.0 is generally defined as the culmination of a series of advances across several related technologies, each of which plays a key role in enabling factories of all kinds to run more efficiently than ever before. These technologies, along with innovative operational changes, are increasing the speed of manufacturing yet again:

automated factory
New technologies like inventory scanning drones are helping companies cope with the labor shortage.

Industrial Internet of Things – This is the most significant of the new technological advances, which is why IIoT is nearly synonymous with Industry 4.0. Robots, sophisticated equipment, and other devices—the machines that are part of Industry 4.0—are now able to provide real-time updates on their location, condition, and current activity through the use of sensors and RFID tags.

Autonomous Robots – The Greek prefix “auto” means self, as in “independent.” And that is certainly true of the newest generation of industrial robots. The pick-and-place robots that have been in operation for several years have more recently been joined by inventory scanning drones. Both are equipped with sensors and managed through cutting-edge software. Though they vary in size and function, nearly all these robots are capable of “seeing” a situation, analyzing it, formulating a response, and acting on it.

Big Data and AI Analytics – Autonomous robots and other devices can continuously provide feedback from the factory floor. But this mountain of data is useless without the software to analyze it. Today’s AI software gathers data from IIoT devices, combines that with input from ERP and CRM systems, and analyzes the information in real time. This provides immediate insights that enable engineers to implement quick changes to the manufacturing process—or further streamline it. 

Horizontal and Vertical Integration – IIoT may be the eyes and ears of Industry 4.0, but these linked devices would be of limited value in a traditionally structured operation. To take advantage of technological advances, companies themselves are changing, becoming more tightly bound both internally and across the supply chain. Horizontal integration entails linking communication across facilities and with suppliers. With vertical integration, production becomes more integrated with other departments—even sales and marketing—to allow for product changes to be quickly implemented. The goal is to eliminate knowledge silos and improve data transfer among departments.V

Cloud Computing – Storing and sharing the vast amount of data that are gathered by IIoT devices would not be possible without cloud computing, and indeed, this service has been called the “great enabler” of Industry 4.0. The cloud is a communication nexus, the easily accessible repository of the data gathered by the cyber-physical systems that drive Industry 4.0.

Additive Manufacturing – Also known as 3D printing, additive manufacturing is more than a tool for rapid prototyping. Today, this technology is used to easily distribute manufacturing across multiple sites, or to customize consumer products on a mass scale. A growing list of products can now be stored in virtual inventories and “built” when and where needed, reducing both warehousing and transportation costs.

Digital Twins – The data produced by the IIoT can be sorted and analyzed in a number of ways for a variety of purposes. One of those purposes is the creation of a product’s digital twin. A digital twin is a simulation of a real product, machine, process, or system. Simulation software allows engineers to create virtual products and analyze their performance, so they can predict potential performance issues, and even identify malfunctioning parts.

Augmented Reality (AR) – Technology doesn’t yet allow us to manipulate holographic representations of data, but AR is pushing that boundary. Smart glasses and other mobile devices can be used to overlay digital content over a real environment, so that, for example, technicians can read repair instructions that appear to float in front of the machines they’re working on. This technology is still in its infancy, but eventually, it will allow engineers and others to step inside 3D models of products or machines to improve design or effect repairs.  

Zero Trust – Zero Trust isn’t a technology so much as an approach to technology, or more specifically, the users of that technology. As computing power becomes integrated into more and more manufacturing machines, and as companies increasingly rely on the cloud and big data to run their factory floors, the costs of a cyberattack will increase exponentially. In response, companies are implementing cybersecurity measures to protect against data breaches and other forms of hacking. This means eliminating an assumption of trust in linked systems. With a zero-trust policy, even internal users, applications, and devices on the network must be verified before they can access any assets.

Building Your Smart Factory

The technologies and policies listed above are the building blocks of a smart factory. Few manufacturers, of course, have made use of every single one of these innovations. Augmented reality, for example, is still a few years away for most companies. And 3D printing isn’t yet considered essential. But these technologies are synergistic. To get the most out of the IIoT, for example, companies need to leverage both the cloud and big data. And that in turn necessitates a strict approach to cybersecurity.

Today’s manufacturing floors are already heavily automated, so in some ways, manufacturing has already entered the era of the smart factory. But as with all industrial revolutions, the changes will speed up as time goes on. The companies that can anticipate these changes are the ones that will thrive.

digital smart factory tools
Fully functional holograms aren’t available yet, but holographic technology is making its way into the smart factory.

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