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Phased approach for Industry 4.0 to succeed

Posted by: Subhash Chandran On August 30, 2016 12:12 PM facebook linked in twitter


I had the opportunity to attend the IoT Next conference held in Bangalore in December, 2015. Many interesting topics were covered, including ‘How Internet of Things will enable Industry 4.0’, a term coined by the German government (as Industry 4.0). This stems from a project set out to prepare German industry for the future of manufacturing, calling it the Fourth Industrial Revolution.

This paves the way for a Smart Factory, which is characterized by adaptability, resource efficiency and ergonomics, and integration of customers and business partners in business and value processes.

The underlying technology to achieve this is based on cyber-physical systems (CPS), networking machines, and components along with intelligent, “smart”, and highly flexible software. Many case studies were presented on how IoT and automation can increase manufacturing productivity, quality, safety, and help in reduction of time to market. While Industry 4.0 looks very interesting, it will take a few more years to mature. Meanwhile, we have to examine what we should do in the interim period.

Indian Manufacturing Industry and Industry 4.0

The concept of Industry 4.0 requires a huge amount of investment in new generation equipment that are IoT compatible, and automation in a large scale.  Additionally, Industry 4.0 undergoing evolution and it may not be sensible of Indian manufacturers to invest in an evolving technology. Most of the manufacturing in India is done by SMEs, and they cannot afford to write their existing manufacturing infrastructure off in order to adopt Industry 4.0 that has a high capital cost.  But this does not mean that we have to manufacture using old and inefficient ways and means.

So what is the solution?

What India requires is a phased approach to Industry 4.0?

We need an intermittent step. We can make our existing manufacturing infrastructure Smarter. In the absence of any terminology, let me christen it Industry 3.5

We can do this using a combination of Hardware retrofit and IT driven manufacturing

1. Retrofit existing infrastructure – We have to enhance the hardware of existing manufacturing equipment and tools through retrofits to make it smarter using IoT. Such retrofits are being developed by some of the companies. While it may not be possible to make all legacy equipment smarter, it may be possible to do it for many commonly used manufacturing equipment and tools.I believe OEMs should explore the possibility of providing such retrofits for their legacy and current equipment. Using this approach, we should be able to derive some of the benefits of Industry 4.0

2. By adopting IT driven Smart manufacturing - Through technology, like demand sensing, manufacturing intelligence, load balancing, directed manufacturing processes, and supply chain management, it is  possible to address today’s consumers and manufacture products in India that are globally competitive. This will call for IT investments in the following areas:

- Digital integrated production planning and shop floor control:  By integrating information flow using advanced manufacturing IT tools during all steps of operations, the visibility required to properly manage the end-to-end processes can be achieved.

- Integrated tool for real-time supply chain visibility: It is a key item which helps in controlling the raw material and final product availability at the right time and price.

- Cloud Based ERP: Connecting with their trading partners in the cloud allows companies to share information generated on the factory floor during the manufacturing process with the entire value chain in real time.

- Social Media Influence & Data Analytics: Social Media greatly influence the consumer purchase decisions and hence analysis of this huge data is necessary to make the required changes to the product to ever changing consumer expectations.

 While the above approach requires investments, these investments will be a lot lesser than investments required for Industry 4.0.


While Industry 4.0 is a good concept, what India requires is a phased approach which will ensure that the existing manufacturing infrastructure’s life is extended using Hardware enhancements and IT, but simultaneously make it smarter to address the new generation manufacturing challenges. The Indian government should emulate the example of the German government, and come out with our own version of Industry 4.0 or 3.5 and provide the required support for its adoption.

Tags: DAVID, Connected Industries
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