Industry 4.0 Explained | What Is Industry 4.0?

What is Industry 4.0?

Industry 4.0 refers to the latest trend in industrial production characterized by the use of interconnected cyber-physical systems (CPS).


We are currently in the middle of major developments in industrial and manufacturing processes. The breakthroughs are so advanced that the times are being identified as the birth of a whole new era – the fourth industrial revolution.

The first industrial revolution happened in the 18th century when the water wheel and steam engine were developed. After about a hundred years, industries were starting to mass produce products with the use of electric power, marking the second industrial revolution. Not too long ago, the third industrial revolution or ‘digital revolution’ then adopted computers to automate manufacturing processes.

In more recent years, machines gained an unprecedented level of autonomy. A key component of the change can be attributed to cyber-physical systems (CPS) and advancements in communication systems. These together have enabled machines to take physical inputs, calculate a logical decision based on an algorithm, and perform a physical output—all without human intervention. This intertwined nature of software and hardware, and the innovations that come with it, usher the fourth industrial revolution.

Industry 4.0 is still in its formative years and further innovations are expected in the coming years and decades.

Cyber-physical systems and maintenance applications

CPS is a mechanism that collects data from observable physical events and processes the data to instruct future actions.

Imagine a computer numerical control (CNC) machine that can perform tasks based on some code you add to it. Now imagine the same CNC machine with CPS concepts applied to run behind it. Beyond being able to produce your required three-dimensional model, it can collect historical data and run simulations to also give you insights on how to create the model with the least number of machine processes and the least amount of material.

The concept of autonomous machines that act based on collected data are also being applied to maintenance practices. Closely related to SCADA systems, monitoring equipment performance is brought a step further by CPS. CPS can decide based on artificial intelligence and predictive logic. All available data can be collected by a theoretical CPS mechanism to run algorithms that simulate performance variations with respect to different parameters.

Principles of Industry 4.0

Industry 4.0 can further be broken down into four basic principles. These principles characterize the major concepts on which the fourth industrial revolution is based.


The internet is a key advancement in technology that Industry 4.0 leverages, allowing continuous data exchange even over remote locations. Known as the Internet of Things or IoT, data communication is no longer limited to a few devices. Instead, various equipment and plant components now have the ability to send or receive data through the internet.

Information transparency

Aided by accessible communication, data and information can be collected and stored in greater quantities. Raw data from sensors are gathered and analyzed to provide accurate representations of equipment and their environment.

Decentralized decisions

Through the use of such systems as CPS, decisions can be tailored to a particular situation. Embedded computer sensors, for example, allow the monitoring and controlling of specific equipment from which data is gathered. Specific actions that are required for a particular equipment in one location may not be the same for the same type of equipment in another location.

Technical assistance

The transition to Industry 4.0 also accounts for the shift in focus of the human workforce. Given that machines such as CPS have more autonomy in performing tasks, the human component shifts more towards specialized decision-making.


Industry 4.0 is the only industrial revolution era that has been identified while ongoing instead of being identified after the fact. It is showing huge potential in the automation and artificial intelligence space that transcends the usual production applications up to proactive maintenance and overall process improvements.

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