Industry 4.0, a new revolution in the manufacturing value chain

Emerging technologies like IoT, CPS, additive manufacturing or robotics are reshaping the mass-production industry, changing the traditional supply process

The new integration of smart technologies is building a more efficiency and connected manufacturing business

The manufacturing industry is facing a crucial time; the fourth industry revolution is going to change the landscape of the industry, and new processes are going to be established in order to transform the industry into a more efficient, intelligent and high performing one with a better and enhanced responsiveness to new challenges and needs.

This evolution is based in new technology advances such as Internet of Things, cyber-physical systems, additive manufacturing or robotics that introduce digital mechanisation into the industry and, therefore, transforming it into a connected one, affecting all processes, products and, also, business models.

In this sense, the so-called smart industry increases the speed of the production and distribution pipeline, adding flexibility to the manufacturing methods and allowing a better adaption to the clients’ requirements and needs. Digitisation represents a personalisation and new functionalities that will transform the competitiveness of manufacturing industries.

Moreover, digital automatisation allows the value chain to have productivity improvements. As Michael Porter introduced it in 1985, the concept of value chain can be defined as the “the process by which businesses receive raw materials, add value to the raw materials through various processes to create a finished product, and then sell the finished product to customers. The overall goal is to deliver maximum value for the least possible total cost and create a competitive advantage”.

Accordingly, the new digital advances such data processing and the hybridization of the physical and digital worlds are changing this value chain and transforming it into a connected chain that will be optimized in order to produce products in a faster and more efficient way. The new technologies are allowing to accurately analyse data in real-time allowing to make market or production decisions with a clear vision of all the possible risks and also correct them before it happens, helping to create a more efficient strategy and planning. In addition, these changes will affect all segments of the industries, from operational departments to human capital and IT.

This transformation is occurring at the moment. Digitisation represents a key opportunity to improve the competitiveness of European manufacturing industry in an increasingly global market. According to the Deloitte Report, Industry4.0 and Manufacturing ecosystems “as the integration of information technology and operations technology evolves, manufacturers will need to assess not only where they are but where they wish to be — decisions that will dictate the types of information they will need to gather, analyse, and act upon”. That is to say, any SMEs that want to survive in this new digital market must accept the challenge of adapting to this new environment by embracing the new possibilities that the new technologies are offering.


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Written by Silvia Valcárcel, MWC — Mobile World Capital