Industry 4.0 - Strengths and Weaknesses

In January 2017

First, many have thought Industrie 4.0 is just a hype that passes by just like the CIM (Computer Integrated Manufacturing) debate of the eighties. Then there was a jerk through industry, business and society. Today the term has been heard nearly by almost everyone. But in the end, as the debate is led, nothing comes to light.

The Industrie 4.0 initiative was launched in 2012. As Prof. Wahlster (DFKI) reported on TV in 2016, the inventors in the Forschungsunion and in acatech were not sure whether we are dealing with the third or the fourth industrial revolution. The participants then found out that the third was actually the automation, so now it has to be about the fourth.

You can do it like that. In the US they see it differently. They have used the time of automation and digitalization of the processes since the seventies very intensively for an IT revolution and left the production to Germany and others. When they now proclaim the Industrial Internet, they declare this as a third industrial revolution. Meaning something similar.

industrial revolution(Graphic: This graphic I created for my second book on this topic "Industrie 4.0 unleashed". It helps discussing the worldwide evolution.)

After the digitalization of the industrial processes and the optimization of automated production, especially in Germany, and after the creation of a software, Internet and finally a data industry especially in the USA, the world today - as Jeremy Rifkin sees it – is on the threshold to a new economy. The Internet is no longer just a communication medium between people and computers, the software is no longer limited to the use with computers and in plant controls. The Internet allows the software-controlled connection of all things with each other and with all people. This allows all products to be equipped with integrated, Internet-based services. This changes the industry itself, and at the same time its value-added processes and business models are changing.

If Jeremy Rifkin is right, we are moving towards a completely new economic system. To sum it up in my words: products that have more and more to offer can be produced without or with very few capital. This is even more true for all kinds of services. More and more, a share economy, a society of sharing, is going to prevail. The high value of ownership is gradually replaced by the higher value of (common) use. The concept of the Internet of Things (IoT) has prevailed worldwide.

Misguided debate

The original documents of the German Initiative Industrie 4.0, which were passed to the federal government in October 2012, contained a definition, which included the change in the entire value-added chain. In fact, however, a very strong focus was placed on production right from the start. "Cyber-Physical Production Systems (CPPS) create Smart Factories, the epitome of the future project Industrie 4.0", said the implementation recommendations. My criticism of November 2012 that this falls too short, reducing Industrie 4.0 merely to a further stage of production rationalization, neglecting the development of products, which are suitable for the Internet and services to be offered in the Internet, this criticism is still daily clicked and read. Unfortunately, today's management of the platform, the Federal Ministry of Economics and Energy under Sigmar Gabriel, deliberately follows this limited course. In the Handelsblatt, Gabriel writes personally on 12th January: "Industrie 4.0, thus the digitalization of the production".

At least the discussion about the future has been pushed. This is the strength of Industrie 4.0. Unfortunately, this discussion goes in the wrong direction. Even more automation and the use of robots are just a drop on the brine of digital connection. They help for a certain time in the automation industry and the large corporations of the automotive industry, for example, which are increasingly characterized by individualized mass production. But as the debate is being conducted at the moment, it is still increasing the fear that is big in Europe and particularly in Germany anyway: Software is eerie and worthless, the Internet a threat, data makes us transparent. This discussion would have deserved to be guided and accompanied in a substantive and professional manner. Not in the style of TV talk shows.

Germany and Europe have strengths in the manufacturing industry and in plant construction and operations, for which they are envied by the now very declining US industry. This is not a reason to open the door to the Industrial Internet Consortium (IIC) and to cooperate harmlessly with the Silicon Valley companies. China also sees the strength of German industry. With Made in China 2025, the huge country is about to catch up against the software world champions in the USA and the hardware world champions in Germany at a furious pace.

The poorness of the leadership of Industrie 4.0 by the federal government can lead to point where many industrial enterprises here in the future are only the cheap hardware suppliers for the economically newly successful industries in the Internet of things. It would be better, the industry would play out its strength and throw itself confidently and innovatively into the tumult. Perhaps also as a partner of a future leading Chinese industry.