Industry 4.0

‘Industry 4.0‘ refers to an expected, fundamental shift in the manufacturing sector whereby advanced automation and data exchange leads to the creation of hyper-efficient ‘smart factories’ as well as other significant improvements in the ways producers operate. Some insiders are calling this trend the Fourth Industrial Revolution.

While information technology (IT) and operational technology (OT) have been used side-by-side on the factory floor for decades – indeed, it’s impossible to really separate the two – recent movements toward the Internet of Things, cloud computing and more autonomous cyber-physical systems are opening up new worlds of possibilities for optimization.

Introduction of Industry 4.0-type solutions could impact everything from how quality is monitored to how much effort goes into supply chain management, with changes extending even to how employees work with and share information.

The overall aim of making these changes, naturally, is to be able to manufacture products at the highest possible rates of efficiency using the least amount of energy and cost. But another key benefit of digitization is boosting factories’ ability to customize. In other words, production lines will become flexible enough to allow production of small quantities of tailor-made goods at a far lower prices than ever before.

Several players in Estonia’s ICT sector focus on Industry 4.0 development. At the center of their strategy is a concept called Real Time Factory which, as the name suggests, allows managers to track key performance indicators in real time, showing where improvements can be made and allowing the entire factory to operate as one integrated system. Tallinn-based SimFactory, for example, specializes in helping electronics manufacturers adopt the Real Time Factory approach, giving them the kind of data-driven production that can streamline every aspect of their operations.

Though factory owners and managers may be skeptical or find the prospect of adopting Industry 4.0-type solutions daunting, they should keep in mind that Estonian IT companies have already successfully overcome the significant inertia and hurdles involved in digitizing the government sector. For these companies, making fundamental improvements in the far more receptive private sector will seem like no challenge at all.