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Solve Forward® is a journal of learned lessons and experiences from the digital transformation front-lines. We are here to share our experiences, and interview others who Solve Forward and learn along the way.

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Industry 4.0 in a Post-Pandemic World

Headless Commerce

[This journal entry is part of our Industry 4.0 experiences.]

The COVID-19 pandemic led to widespread, complete lockdown measures by several nations. The result was negative effects on the manufacturing, logistics, and supply chain industries.

While businesses grappled with the global recession due to COVID-19 in the spring of 2020, the manufacturing sector is now likely to overtake the pre-pandemic level output by the third quarter of 2021. The Manufacturers’ Outlook Survey, conducted by the National Association of Manufacturers, highlighted that during the second quarter of 2021, 90.1% of the respondents felt either somewhat or very positive about their company outlook.

When COVID-19 became a global concern, industries quickly adapted to the changing landscape by increasing automation and adopting a contactless manufacturing process. Forward-thinking companies were more prepared for the pandemic and handled the transition better. The events of last year further reiterated the need for the transition towards Industry 4.0, with an even greater enthusiasm.

How can Industry 4.0 make a difference?

Industry 4.0 is a philosophy that aims for industrial process transformation through digitalization, innovative technologies, industrial automation, and smart sensors and materials. Technologies such as cloud-based data storage, IIoT devices, process automation, AI/ML, smart sensors, and 5G connectivity are at the core of this philosophy.

Increasing automation helps reduce contact, which in turn can protect the health of workers. There may also be a shift of labor to more productive tasks or projects, which would then provide the financial impetus for industries to get back on their feet. Sectors such as food processing, pharmaceuticals, and supply chains can also benefit through contactless food preparation methodologies

Industry 4.0 poses an ongoing challenge to smaller businesses because they are not as developed and could be left behind by larger companies. As Industry 4.0 usage increases the cost to adopt it for smaller businesses also decreases. It offers solutions for small business owners in the event of a pandemic or other unforeseen events that may strike.

The Future of Industry 4.0 post-COVID-19

The priority of industries and businesses tend to lie in these three phases post the COVID-19 pandemic:

Phase 1: Survival

Phase 2: Recovery

Phase 3: Business in a post-crisis paradigm

While manufacturers desire to achieve phase 3 as soon as possible at the lowest cost in both time and money, they must create a sustainable solution with long-term goals.

Industry 4.0 has a crucial role to play for various sectors in the coming years. Some of these are:

  • Helping companies to survive in dire situations such as lack of workforce, plant breakdowns, and even pandemics.
  • Assisting in making thoughtful planning and resource-allocation decisions through AI-based analytics and adjusting output goals accordingly.
  • Aiding industries to develop a flexible business model that adapts to changes in products and services requirements.

What are the Benefits that Industry 4.0 Provides in a Post-Pandemic world?

Industry 4.0 can reduce the impact of the pandemic on industrial sectors. Some of the examples where Industry 4.0 can help deal with unforeseen crises are as follows:

  1. Industry 4.0 gives real-time visibility in the manufacturing industry. Smart sensors monitor machines, processes, and output parameters round the clock. The real-time visibility helps track and project the availability of raw material, finished goods, WIP, workforce, and capacity.
  2. Companies can use Artificial Intelligence-based IIoT devices to develop patterns and insights. In addition, AI offers an advanced level of analytics for organizations to enhance operation and productivity.
  3. The use of robotics can reduce dependency on the workforce for labor-intensive activities.
  4. Industries can provide remote safety and operations training to workers through Augmented Reality (AR), Virtual Reality(VR), Wireless, and Mobile technologies.
  5. Wireless connectivity and cloud-based data storage can enable remote monitoring of daily operations.
  6. AR and VR technologies combined with digital twins can improve the design and analysis of products with much lesser consumption of resources and reduce the dependency on physical testing.
  7. In-house manufacturing of spare parts using 3D printing can help temporarily substitute for the items stuck in the supply chain.
  8. Automated guided vehicles and drones can reduce the reliance on physical movement required to monitor equipment, perimeter security and assist with social distancing.

Industry 4.0: An Outlook in the Post-Pandemic world

Industry 4.0 technologies were developed before the pandemic to improve performance and efficiency, but now that we have seen its aftermath, it's clear this philosophy has a much wider range of benefits for developing sustainable solutions or enhancing industry preparedness in dealing with sudden disruptions.

Even during the pandemic, several sectors used advanced Industry 4.0 technologies to mitigate the consequences of the crisis. From 3D printing of PPE kits to augmented reality and cloud-based solutions for the production of ventilators, the world witnessed the power that Industry 4.0 technologies can harness.

Post-pandemic, Industry 4.0 is one of the most realistic and comprehensive transformations that industries worldwide can undergo. An Industry 4.0 transformation mindset will help organizations meet their immediate goals and manage their resources better for transformation.

There has been a rapid digital acceleration and adoption of new technologies in industrial sectors during the pandemic. In a 2021 DM EXCO Survey, about 70% of respondents in DACH countries expected that the coronavirus would provide an impetus to the growth of digital transformation.

Along with existing industries, Industry 4.0 technologies also present a plethora of opportunities for investors. As we witness an increased transition towards Industry 4.0, the amount invested in these sectors will also grow exponentially. According to an IDC and Bloomberg intelligence report, the IIoT market alone may reach USD 1.1 trillion by 2021, growing 13% annually from 2016 to 2021.

Although the pandemic affected the manufacturing and supply chain sectors, it paved the way for increased automation and adoption of digital resources. Industry 4.0, IIoT, and AI adoption will continue to rise with the investment in 5G technology.

With the uninterrupted digital infrastructure that Industry 4.0 creates, businesses from all sectors can make significant gains. Not only can Industry 4.0 create immediate solutions but also help industries achieve their long-term, sustainable goals. The pandemic paved the way for a more automated future, which is critical as Industry 4.0 and IIoT adoption continue to rise with 5G investments in industries across the board.

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