Challenges in implementing Industry 4.0 technologies in manufacturing companies

Abstract

Industry 4.0 originates from the German wording ”Industrie 4.0” and it was introduced publicly for the first time at the Hannover Fair 2011. The German government produced a report of Germany’s future actions regarding Industry 4.0 and after that, the research and buzz around the fourth Industrial revolution has been substantial. Many areas of the subject remain merely unresearched. This research will cover a service provider's perspective on the different challenges of implementing Industry 4.0 technologies.

The Industry 4.0 technologies are divided into base technologies and front-end technologies as in the framework by Frank et al. (2019). The base technologies are: (1) Internet of Things, (2) Cloud, (3) Big Data and (4) Analytics. The base technologies enable the concept of Industry 4.0 and the front-end technologies. These technologies can be used for different kinds of optimization, predictive maintenance etc. The implementation of these technologies includes various challenges, which are in this research, categorized in the following way:

• Managerial • Business-related • Technological

The primary data for this thesis is interviews with case company X. X is a Finnish startup specializing in end-to-end IoT-systems for the manufacturing industry. They have experience from different kinds of projects such as hydro plants and heavy industry machinery. I interviewed two members of X’s board which are both experienced in their own fields of specialization. New aspects to the existing research will be achieved with a semi-structured interview.

Case company X’s successful sales process usually starts from preliminary discussions and leads to a Proof of Concept (PoC). A proof of concept is the best and most common way for the implementation of their solutions, but that is usually where the problems occur¬¬ in the above-mentioned categories. Key challenges of implementation of Industry 4.0 technologies include communication, lack of a clear business case and security issues. New innovative Industry 4.0 solutions mix the digital and physical worlds and enable new business- and revenue models.

The implementation process of Industry 4.0 solutions isn’t yet comprehensively researched and there are many interesting research topics for the future in all of the three categories named in this research. In addition to the named challenges, politics and legislation effect the future of Industry 4.0. Global challenges such as sustainability and labour supply can also be more thoroughly handled with the Industry 4.0 framework in the future.