Change Management

Digital Transformation and Industry 4.0

Digital transformation and industry 4.0 are causing a storm to many manufacturers and factories alike. It has improved their operations a lot. How so? Keep reading below to know.

Digital Transformation and Industry 4.0

Industry 4.0 is the result of digital transformation. When digital transformation rose, it made its way to manufacturing, thus forming Industry 4.0. This is a combination of smart manufacturing and cloud computing.

Digital transformation is a phenomenon that has taken place in the new millennium. It involves upgrading an organization’s business model to better suit the needs of its consumers. This through new technology and innovation.

In the new paradigm, organizations have been able to engage consumers on different levels. Business models have been disrupted by digital marketing and social media marketing strategies. Consumers have become more empowered and can now influence decision-making in organizations.

One example would be the use of social media to create hype around a product. This is the same concept used by speculators to manipulate the price of a commodity. Companies can now produce a product and sell it before the production process is even done.

The journey has also resulted in a new way of doing business. The “lean” method was created to improve quality and cost at the same time. Lean manufacturing has been embraced by many companies due to its flexibility as well as cost-effectiveness.

Thus, the digital transformation is now spreading through manufacturing, forming Industry 4.0. Industry 4.0 has been called digital manufacturing.

What is Industry 4.0?

Industry 4.0 is a term coined by the German government to refer to the fourth industrial revolution. It is a combination of smart manufacturing and cloud computing. It refers to a networked system that allows machines, computers, and facilities to connect through the internet of things (IoT).

This enables them to exchange data automatically. This also allows real-time monitoring of activities taking place inside a factory or facility.

In Industry 4.0, huge volumes of data are collected from connected machines and sensors inside a factory or facility. These data are analyzed using machine learning algorithms before being applied to production facilities for optimization purposes.

How does it differ from Industry 3.0? Industry 3.0 refers more to optimizing efficiency by reducing waste and cutting costs. It was primarily focused on improving organizational productivity, but not on improving customer satisfaction. Also, it didn’t make use of new technology such as IoT and Big Data analysis. It doesn’t use devices such as robots for automation either.

While industry 4.0 is based on cloud computing and the Internet of Things (IoT). These technologies enable companies and factories to be more transparent on what they produce and how they produce it. This results in better quality control on their products as well as services provided. 


As you can see, Industry 4.0 is the result of the digital transformation, which is now spreading through manufacturing. It has improved operations a lot. This is because of the use of smart manufacturing and cloud computing. It allows companies to be more transparent about what they produce and how they produce it.