The Fourth Industrial Revolution: Redefining the future

May 6 · 15 min read

Dr Swati Subodh

Twitter: @swatisubodh

In mid-October 2018 Prime Minister Narendra Modi launched the World Economic Forum (WEF) Centre for the Fourth Industrial Revolution in New Delhi; the fourth such centre in the world after San Francisco, Tokyo and Beijing. The pillars of “Industry 4.0”, namely, Artificial Intelligence, Machine Learning, Internet of Things, Blockchain, and Big Data, can potentially transform the present and future of human life. In India and other emerging economies, this industrial revolution could be a key social transformant as well. With India’s growing IT capacities, clubbed with the country’s high tele-density and expertise, we are poised to become a major contributor to Industry 4.0.

The discussion around the ‘industrial revolution’ has transcended from the confines of merely a historical reference to everyday dialogue in the present-day context. From the first industrial revolution that was propelled by mechanisation through water and steam power, to the mass production and assembly lines using electricity in the second; the fourth industrial revolution is expected to take what was started in the third industrial revolution with the adoption of computers and automation and enhance it with smart and autonomous systems fuelled by data and machine learning. It will blend the physical with the digital as it’ll amalgamate a range of new technologies that combine the physical, digital and biological worlds. It is predicted to impact all disciplines, economies and industries. When we look around us, we know that this has already begun!

From Flash Back to Fast Forward

Historically, all the industrial revolutions have originated around the rapid transformations due to technological advancements in production systems or the manufacturing sector. This is also true for the fourth industrial revolution, also referred to Industry 4.0 or I4.0, as it is already transforming factories and production floors across the world.

Source: Forbes

Although the name, Industry 4.0, itself is shrouded in debate, it is believed to have originated from a project as a high-tech strategy of the German Government, which promoted the computerisation of manufacturing. The name was later revived in 2011 at the Hannover Fair. It includes cyber-physical systems, the Internet of things (IoT), cloud computing and cognitive computing. These units of I4.0 are popularly being referred to as ‘smart factory’ for they will seamless integrate the cyber-physical systems and physical processes of the factory backed by decentralized decision making. The physical systems integrate with the IoT devices which communicate and cooperate both with each other and with humans in real time over the wireless web.


In brief, ‘Smart factories’ must include;

  • Interoperability: Machines, devices, sensors and people that connect and communicate with one another.
  • Information transparency: The systems create a virtual copy of the physical world through sensor data in order to contextualise information.
  • Technical assistance: The ability of the systems to support humans in making decisions and solving problems and the ability to assist humans with tasks that are too difficult or unsafe for humans.
  • Decentralised decision-making: The ability of cyber- physical systems to make simple decisions on their own and become as autonomous as possible.

Components of Industry 4.0

Nine technologies are being considered as the main building blocks of industry 4.0.

Source: Deloitte

Big Data and Analytics: Today data is being collected from multiple sources at an unprecedented rate. This large amount of data needs to be deciphered to uncover hidden patterns, correlations and other insights. With enhanced computing capacities we can now analyse vast quantum of data in real-time. The data collected from different sources like production equipment and systems on the one hand, and enterprise and customer management systems on the other, will need to be collated and will graduate to become the standard to support real-time decision making. Big data will also determine major decisions for organisations as it becomes more predictive in nature, giving insights to causal associations, future trends and behaviours.

Source: BCG Analysis

Interoperability of data sets, standard data formats and data security issues are some key issues that need to be addressed to exploit big data to full potential. The ‘analysis gap’ between the present analytical capacities versus the rate of data generation needs to be narrowed down too.

Autonomous Robots: The needs of the manufacturing sector to increase its productivity manifolds is what propelled Industry 4.0 in the first place, so it will also be the first workplace that will eventually have robots who will coordinate between themselves and with the humans to expand the present capabilities and capacities.

Simulations: This is referred to as leveraging of real-time data that mirrors the physical world in a virtual model. This model helps the users in testing activities in a virtual model so that the actual physical changeover can be tweaked beforehand in the interest of time, cost and overall efficiencies.

Horizontal and Vertical Systems Integration: So far individual tasks are often disconnected with other tasks in the manufacturing pipeline. To automate the process, these tasks need to be interconnected to pre-empt requirements and prepare for contingencies, synchronise activities, optimise resources and maybe, even communicate to systems beyond its framework. This is targeted to run across the entire value chain to work across companies, departments, functions and capabilities to create a more cohesive network. The universal data integration and interoperability across systems aims to truly automate all value chains.

Internet of Things: This will enable more devices to ‘talk’ to one another through embedded computing. This communication through centralised controllers will also decentralise analytics and decision making thereby enabling more real-time responses. In a short time, this space has witnessed rapid growth, which in turn, is translating to bigger opportunities.

Cybersecurity: The increased connectivity of devices and the continuous flux of data back and forth in open networks and forth in open networks also makes the system susceptible to cyber threats through malware and spyware. Identifying these threats and protecting the data is important to maintain the integrity of the working protocols and systems whilst maintaining confidentiality of the data per se. As a result, this new branch of data and system protection mechanism has progressed manifolds to safeguard the virtual world.

Cloud Computing: This is the use of various services, such as software development platforms, servers, storage and software, over the internet, often referred to as the “cloud.” Data sharing and functionality between systems will transcend sites and across company borders bringing down communication and reaction times to few milliseconds. This will promote more data driven services for production and service integration.

Additive Manufacturing: The most common example in this sphere is 3D printing which is used for prototyping and small- scale production purposes. These additive-manufacturing methods are attractive for production of small batches of customised products that offer construction advantages, such as use of different materials; and complex, lightweight designs.

Augmented Reality: AR is still in a developing stage and its usage among public is just beginning to gain momentum. It adds a virtual layer over real-world features to add more information and dimensions for enhanced understanding and visualisation. It is predicted to provide a broader use to workers and users with real-time information for improvement for decision making and work procedures.

Collective Transition


It is clear then that the question is not if the fourth industrial revolution will happen; it is how fast it will happen. The race to become Industry 4.0-ready is already underway in many countries of Europe, Asia and America as it is being increasingly viewed as a key determinant of increased productivity while being cost-efficient which will ultimately define the revenue growth in the fast-changing technology and process ecosystems.

Source: MIT Technology Reviews

In early 2018, the World Economic Forum estimated the ‘readiness’ of 100 countries in being Industry 4.0 ready. In their report, they defined the six key ‘Drivers of Production’ against which the readiness was assessed as Leading, High-potential, Nascent and Legacy. Where Leading indicates strong production base today that exhibit a high level of readiness for the future and Legacy indicates strong production base today that are at risk for the future due to weaker performance across the Drivers of Production component.

Source: The Economic Times
Source: Deloitte

The 25 leading countries identified were from Europe, North America, and East Asia and the Pacific that are responsible for over 75 per cent of global MVA (Manufacturing Value Added) today. Whereas 10 legacy countries come from Europe, Eurasia, East Asia and the Pacific, Latin America, Middle East and North Africa, and South Asia that are responsible for approximately 10 per cent of global MVA today.

Over the last two decades China has evolved its capabilities from producing low-cost goods to more advanced products. However, due to its size, the levels of excellence varied across different pockets and thus bringing down its average readiness levels. In 2015, the government launched “Made in China 2025” to upgrade the country’s manufacturing sector and fund manufacturing innovation. On the other hand, Germany ranks in the top quartile across all Drivers of Production and in the top ten for the Technology & Innovation, Human Capital, Global Trade and Investment and Demand Environment drivers. Acknowledged as the pioneer in the Fourth Industrial Revolution, Germany stands out for strong education outcomes, advanced technical training programmes, a highly capable current workforce and a proven ability to innovate. It has accelerated setting its own standards and has also developed framework for international adoptions. With the launch of Industrie 4.0 in 2011, Germany was one of the first countries to increase digitisation and the interconnection of products, value chains, and business models to drive digital manufacturing forward.

Source: The Times of India

Another country leading the manufacturing sector is the United States of America. The country holds the top score on the Drivers of Production component and scores the Top 5 across all drivers except Sustainable Resources and Institutional Framework. USA is internationally known for its ability to innovate and is currently at the forefront of major developments surrounding the emerging technologies of the Fourth Industrial Revolution. Furthermore, due to its strong higher education institutions it has been able to develop, attract and retain advanced human capital capabilities.

The Indian Story

In the last three decades, India’s manufacturing sector has grown by more than 7 per cent per year, on average, while accounting for between 16 per cent to 20 per cent of India’s GDP. India has the second-largest population in the world and is one of the fastest growing economies; this is translating into huge opportunities for the demand for Indian manufactured products, which is on an upswing. In 2014, the Indian government launched the “Make in India” initiative, with the primary goal of making India a global manufacturing hub. To give a significant push to improve key enablers and move towards a more connected economy, it announced a US$ 59 billion investment in infrastructure in 2017. Although India lags behind its global peers in I4.0 adoption, the country has been moving to improve productivity through tech advancements and enabling the manufacturing sector to achieve the target set by the government of contributing 25 per cent of GDP by 2022.

In October 2018 the World Economic Forum’s Centre for Fourth Industrial Revolution was launched. The centre will facilitate to bring together government and business leaders to pilot emerging technology policies. It has selected drones, artificial intelligence and blockchain as the first three project areas. The centre will work in collaboration with the government on national level to co-design new policy frameworks and protocols for emerging technology alongside leaders business, academia, start-ups and international organizations. NITI Aayog, the government’s think tank, will coordinate partnership on behalf of government and work of centre among multiple ministries. The intent to leapfrog towards I4.0 is clear

Towards Digitisation

Over the past few years India has been taking steady strides to boost digital technologies. The momentum has picked up with the Digital India initiative being rolled out in different sectors by the present government with an overlay of Rs. 1 lakh crore to transform the country’s knowledge equity.

The Digital India launched by Prime Minister Narendra Modi on 1 July 2015 is based on three core elements; i) Creation of digital infrastructure, ii) Delivering services via digital means, and iii) Spreading digital literacy.

Digital Infrastructure

Although many projects were launched under the Digital India initiative, a few fare better than others and are laying the framework to accelerate India’s readiness for I4.0 Bharat Net: Under this initiative a high-speed digital highway will connect 250,000 gram panchayats of the country. This is the most ambitious and world’s largest rural broadband project using optical fibre. As per latest update from the Ministry of Telecommunication, 50 per cent of the gram panchayat’s have been connected and the remaining 125,000 will be completed by March 2019. The network will also be extended to police stations, high schools and other educational institutions, post offices and primary health centres. This initiative takes cognizance of the fact that India’s I4.0 readiness cannot just be an urban phenomenon; it will have to include the 70 per cent of the country’s population and the production units scattered across the hinterlands, rural and semiurban geographies.


4G WiFi hotspots: Another ambitious initiative by the government is to deploy 10 million hotspots across the country. To achieve 10 million WiFi hotspots by 2022, the Government should focus on WiFi hotspots deployment as per India’s population and focus more on villages. Around 6.5–7 million WiFi hotspots need to be deployed in 649,481 villages with a total population of 833 million which will help in transforming lives of farmers and particularly the youth while around 3.5–3.0 million WiFi hotspots needs to be deployed in 7,935 cities/towns with a total population of 377 million at regional levels across India.

(a)The launch of Aadhar − the world’s largest biometric ID programme by the UIDAI, Government of India, was perhaps among the first few steps in unifying people and services on a national scale. Today there are over 1,229,122,162 enrolments on this platform. This number is set to rise further as the enrolment is increasingly been made mandatory for anyone to avail government schemes and subsidies. Two years back, with an overnight recall of Rs. 500 and Rs. 1000 currency notes, 86 per cent of the country’s currency ceased to be legal tender. Although this was to fulfil a different mandate, this move pushed the people of the country to start dabbling in cashless transaction with the aim to enable them to adopt digital platforms for financial transactions. Until then most of the consumers lacked bank accounts for any exposure to the organised banking system. India’s innovative and free homegrown digital payments ecosystem Bharat Interface for Money (BHIM) Unified Payment Interface (UPI) has got support from Google’s Sundar Pichai, Dell’s Michael Dell, and economist Nouriel Roubin. Clubbed with Aadhar, it hopes to enable easy financial transactions across the country. The Union Government has asked the country’s banks and payment companies to boost their digital transaction volumes to 30 billion in the current fiscal year. It has laid out specific targets for individual institutions as it seeks a near50 per cent increase from what was achieved in the previous year.

Technology & Innovation

Adoption and diffusion of emerging technologies is the crux of the Fourth Industrial Revolution. There is a need to continually upgrade technology infrastructure to ensure their platform is advanced enough to fully operate emerging technologies. India plans to be a $10 trillion economy by 2030, with technology advancement and investments in innovation at the centre of it. However, currently we lag behind at rank 91 among 135 countries in the networked readiness index that is a key indicator of how countries are doing in the digital world. It depends on whether a country possesses the drivers necessary for digital technologies to meet their potential, and on whether these technologies are actually having an impact on the economy and society. Thus, beyond technologies, the process of systems integration also becomes important. This also defines largely the parameters set to assess the Global Readiness Index for Industry 4.0.

The Start Up India initiative was launched to harness the technical prowess of the young Indians while creating an entrepreneurial ecosystem for sustenance and impact. India is the third-largest start-up ecosystem in the world with 26,000 start-ups, which have created a value of $100 billion; by 2025 India is expected to have 100,000 start-ups, which will employ 3.5 billion people, and will create $500 billion. While technologies like AI, IoT, big data analytics and robotics intersect to create the framework for seamless and automated integration of various activities and is one of the preferred sectors among the start-ups, it is how these are applied across suppliers, customers, workers, partners, collaborators and others in their ecosystem will decide more transformative benefits while creating newer business models.

India launched the ‘Make in India’ initiative to boost its manufacturing sector as the partner country at the 2015 Hannover Messe, Germany. India intends to leverage Industry 4.0 concepts and new technology in initiatives for manufacturing, smart cities, and overall infrastructure as part of the country’s Digital India initiative. Besides tax rebates, land and export incentives and the Good and Services Tax (GST) as part of this initiatives, the convergence of disruptive technologies will play a central role. For example, autonomous or driverless driving is expected to completely revolutionise the automotive industry; and connected cars take advantage of connectivity through IoT and enable a new driving experience. Although the automobile industry fares better than the average manufacturing industry in term of robot deployment, there is still a long ground to cover. The annual shipment of robots to India is set to double between 2017 and 2020 but the numbers still remain modest.

Human Capital & the future of jobs

Source: TOI
Source: TOI

A common challenge in Industry 4.0 adoption across all nations is the lack of adequately trained workforce since people are at the forefront of the Fourth Industrial Revolution. Human capital is critical to the transformation of production systems, as production facilities cannot evolve unless employees evolve too. So, as opposed to the ‘job loss to robots’ scare, human ingenuity and creativity may become more, not less, important in the future of production. The Fourth Industrial Revolution will result in a further shift from labour-intensive production to knowledge and skills-intensive production. Countries will need an adequate pool of available digital, technical, commercial and management expertise to propel the immediate adoption and use of emerging technologies. Reflecting this transition, data management, data security, software development, programming, data science, and analytics are among the most desirable Industry 4.0 skills going forward. Occupational re-training and hiring new talent are both being explored in addition to emphasis on education are being explored to fill the ‘skill gap’.

According to a report published by the World Economic Forum, the change in the way we do things will have a major effect on the jobs, 5 million to be precise, which will be lost in the next 10 years! In India, 1 million youth join the workforce every month, to make them ‘employable’ or ‘career ready’ a whole set of training, and skilling would be required.

Workplace diversity will become even more important, and the shifting physical and organisational boundaries of the workplace will allow talent to be sourced globally and remotely.

Source: World Economic Forum


The impact of the industrial revolutions on the environment and the climate has been a matter of concern. Industry 4.0 is thus not just about economic growth by automation and increased productivity while developing innovative business models; it is equally about how it manages its waste and progresses towards a circular economy. Unlike a linear economy which follows the ‘Make-Use-Dispose’ model, the circular economy follows the ‘Make-Use-Reuse’ model. The previous industrial revolutions introduced waste, the fourth has the potential to eliminate waste. It supports circular business models that only consume renewable resources and keep materials from finite stocks in an infinite loop Besides environmental impact sustainability as a Production Driver, I4.0 is also about the survival and growth of the companies per se. With increased dependence on non-renewables, the industry’s bottom line will be affected sooner rather than later.

Industry 4.0 and circular economy intersect at many places. For example, advances in robotics would allow manufacturers to employ robots in an increasing number of applications, thereby increasing yield and reducing waste, as well as extending product life times. The use of 3D printing for the on-demand production of spare parts would improve maintainability and extend the life cycle of products and equipment. It would also affect product design in that future 3D part maintenance can be built into the process.

In conclusion, unlike the previous industrial revolutions, where the advancement in technology resulted in an overhauling of the economies of the time, here the individual technologies and the integrating systems are coming together to create an ecosystem that all nations are aspiring for; this would finally transcend into the fourth industrial revolution. The wheels are in motion and is catching speed as the race to I4.0 is not about competition but a matter of survival in fast changing global dynamics.

(The article was published as Cover Story in the November-December issue of Invention Intelligence, a magazine by the National Research & Development Corporation)

Dr Swati Subodh

Written by

Dr Swati Subodh is a scientist, social entrepreneur, writer & healthcare professional. Her columns and articles have been published in reputed media platforms.

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