Collaborative Learning Discussion - Initial Post

In this week, students were instructed to describe the following:  What do the authors mean by the term ‘Industry 4.0’ - give two examples?  Give two real-world examples of risks that fit into the authors categories.  Find another journal article that either supports or contradicts the points made in the cited study.

Industry 4.0 is the next stage of digitization of the industrial sector, which is known as Industry 4.0, or 4IR for short. It is being driven by disruptive trends like the growth of data and connectivity, analytics, human-machine interaction, and advancements in robotics. (McKinsey & Company, 2022) With the help of four fundamental disruptive technology types (examples below), Industry 4.0 takes these inventions to new heights. These technologies can be implemented at every stage of the value chain: -sensors, blockchain, cloud computing, and the Internet all provide connectivity, data, and processing power. -intelligence and analytics: machine learning, artificial intelligence, and advanced analytics. -human–machine interaction: robotics and automation, autonomous guided vehicles, virtual reality (VR) and augmented reality (AR). -advanced engineering: nanotechnology, renewable energy, and additive manufacturing (like 3-D printing).

Many automakers have implemented Industry 4.0, utilizing its concepts to build intelligent, networked production processes. These systems gather real-time data from several manufacturing process stages using sensors and Internet of Things (IoT) devices. The application of digital twin technology to produce virtual duplicates of real assets like engines, planes, or componentry has also been expanded to the aerospace sector. These virtual twins are constantly receiving data from sensors and other sources, and they are linked to their physical counterparts. With advantages of Industry 4.0 also come disadvantages. Some of these include technical skill gaps, data security, interoperability issues, managing data growth, down time risks and what one may refer to as ‘the road ahead’. Change is never easy, especially when it comes to business. Manufacturers have been using the same basic processes and technologies for decades, so it’s no surprise that they’re hesitant to embrace evolution. (Automation Alley, 2022) Taking into consideration all of the above, adapting appropriate risk management strategies to these new concepts can have many benefits, and on the other hand challenges. Kovaitė and Stankevičienė (2019) state that research on the risk that technological drivers bring to businesses assessment can be found, but it is very seldom to find a systematized approach to risks and methods to test the changes in the business models if digitalized due to Industry 4.0. Findings of results determine 6 types of risks: technical, competence, acceptance by staff, acceptance by customers and partners, data privacy and security and financial risks. Out of these, the highest risk being in customer channels, key resources, and revenue stream and customer segmentation.

On the other hand, Gadekar, R. & Sarkar, B. & Gadckar, A. (2021) found that technical and information technology (IT) risks are found to be on top of the priority list, which needs urgent attention while embarking on this industry adoption, and the most important criteria, which needed urgent attention was Information Security. They also introduced the aspect of economic, legal & political risks as well as ecological which is very important because as the digital world evolves, this could potentially imbalance and further deteriorate the quality of environment due to disposal of electronic waste and increase of pollution.

References: McKinsey & Company (2022). What Is Industry 4.0 and the Fourth Industrial Revolution? [online] McKinsey & Company. Available at: https://www.mckinsey.com/featured-insights/mckinsey-explainers/what-are-industry-4-0-the-fourth-industrial-revolution-and-4ir. [Accessed 03 February 2024]

Automation Alley. (2022). Top 5 Threats Facing Manufacturers in the Era of Industry 4.0 – And How to Avoid Them. Available at: https://www.automationalley.com/articles/top-5-threats-facing-manufacturers-in-the-era-of-industry-4-0-and-how-to-avoid-them. [Accessed 04 February 2024].

Gadekar, R. & Sarkar, B. & Gadckar, A. (2021). Assessment of Risks for Successful Implementation of Industry 4.0. Recent Advances in Computer Science and Communications. Available at: https://www.researchgate.net/publication/351378653_Assessment_of_Risks_for_Successful_Implementation_of_Industry_40/citation/download. [Accessed 5 February 2024].

Kovaite, K. & Stankeviciene, J. (2019). Risks of Digitalization of Business Models. Available at: https://www.researchgate.net/publication/333063956_Risks_of_digitalisation_of_business_models. [Accessed 5 February 2024].