Industry 4.0 was proposed by Germany in 2011 as the fourth industrial revolution. It has attracted attention as it will bring about major changes to the way people work in the manufacturing industry and what can be achieved. However, in Japan, awareness of Industry 4.0 is still low and there are various issues, so the realization of Industry 4.0 has not yet proceeded smoothly. In this article, we will look at the overview and effects of Industry 4.0, and then explain the current state of Industry 4.0 in Japan, the challenges of its implementation, and the key points for realizing it. If you are a manufacturing manager in the manufacturing industry who would like to know more about Industry 4.0 or are considering implementing it, please use this article as a reference.
What is Industry 4.0?
Until now, there have been three industrial revolutions: the first was driven by water power and steam engines, the second by oil and electricity, and the third by IT technology. The current fourth industrial revolution refers to a revolution in the manufacturing industry, mainly through the smartification of factories.
Specifically, after the third industrial revolution, which promoted IT, it refers to the optimization of the manufacturing process from development to distribution by incorporating IoT, AI, big data, etc. Industry 4.0 goes beyond the simple improvement of business efficiency through IT and also enables mass customization, which simultaneously realizes the contradictory production forms of mass production and made-to-order.
The difference between Industry 4.0 and IoT
When understanding Industry 4.0, it is essential to correctly understand the difference between it and IoT. IoT, translated as Internet of Things, is a mechanism for networking and controlling information on things that were not previously connected to the Internet, such as homes, cars, and home appliances.
In contrast, Industry 4.0 refers to the idea of utilizing the IoT mechanism to network the machinery and business systems used in factories to realize smart factories. In other words, IoT is merely a mechanism, and Industry 4.0 is about using it to reform the way people work and business processes in factories.
For more information on smart factories, please also refer to this article:
What is a smart factory? Explaining the benefits of smart factories that will change the field of production management and key points for implementation | Stratus Blog
What will Industry 4.0 bring?
What will be achieved as Industry 4.0 advances? Specifically, the following can be mentioned:
Mass Customization
"Dynamic cell production," which applies mass production methods directly to custom-made production, will enable the manufacture of products that meet diverse needs without much effort, making mass customization a reality.
Factory automation
As Industry 4.0 advances, it will become possible to give instructions to machines remotely and manufacture products automatically without being present at the factory. It will also be possible to collect various data from the production process and predict machine failures and defects in advance.
Factory automation will improve efficiency and productivity, and if it continues to evolve, it may become possible to automatically adjust production, leading to the realization of full automation.
Current status of Industry 4.0 in Japan
Industry 4.0 originally began in Germany in 2011. More than 10 years have passed since then, but it cannot be said that Industry 4.0 has been as widespread in Japan as in other countries.
For example, in a survey conducted by Nikkei Monozukuri in October 2021, 60.5% of respondents said that Japan's movement toward smart factories is not as advanced as the rest of the world.
Reference: Survey on "Current status and initiatives of smart factories" | Nikkei XTECH
In addition, when looking at efforts toward DX (digital transformation), the Ministry of Internal Affairs and Communications' Information and Communications White Paper (Reiwa 3rd Edition) states that 77.2% of manufacturers responded that they are not taking any steps toward this goal. Over half (57.2%) also responded that they have no plans to implement it in the future.
Reference: Information and Communications White Paper (Reiwa 3rd Edition) | Ministry of Internal Affairs and Communications
One of the reasons why Japan's efforts towards Industry 4.0 are not as advanced as the rest of the world is that companies are taking the lead.
Germany is leading the way with its government working on Industry 4.0 as a nation, and the United States also established the Industrial Internet Consortium in 2014. China also announced a national strategy called "Made in China 2025" in 2015.
In response to this, the Japanese government also strengthened its efforts as a nation in 2017 under the name "Connected Industries," but at present, this has not yet reached the entire manufacturing industry in Japan.
In addition, overseas, the WEF (World Economic Forum) has been working with McKinsey since 2018 to create the "Global Lighthouse Network," which selects the world's leading DX companies. As of July 2022, 103 Global Lighthouse companies have been selected.
As an example of a selected company, let's take a look at Schneider Electric, a French manufacturer of electrical and industrial equipment. The company is promoting DX at its headquarters in France, and based on its case studies, it has deployed its know-how at bases around the world and achieved scale-up. The scope of expansion has expanded from five locations in 2017 to more than 80 locations in 2021, making this an example of digital transformation progressing at an astonishing speed.
Challenges of Industry 4.0 and key points for realizing it
There are several reasons why Industry 4.0 has not progressed as much in Japan as it has in the rest of the world. Apart from the lack of a full-fledged support system in the country, the main issues that can be considered are as follows:
Shortage of cutting-edge IT talent
The Ministry of Economy, Trade and Industry's "Survey on IT Human Resources Supply and Demand" published in March 2019 predicts that there will be a shortage of up to 790,000 IT human resources by 2030. To realize Industry 4.0, it is essential to employ cutting-edge IT human resources who are familiar with AI, IoT and data science, but due to a labor shortage, it is not possible to secure such human resources.
In addition, while there is a cry of a shortage of cutting-edge IT human resources, there is a possibility that the work in factories that has been done manually will be automated, resulting in a surplus of manpower. As a solution, it is important for companies to raise their awareness of developing human resources with support from the government. In addition, it is also important to consider transferring some of the human resources who have worked in factories so far to new highly productive work and cutting-edge IT human resources, depending on their qualities and skills.
Security measures
To realize Industry 4.0, it is essential to utilize the Internet. However, in many cases, factories do not even have an Internet environment in the first place. Even if the Internet is available, in most cases, improvements are required to take into consideration advanced security measures. In addition, to streamline production management, it is essential to cooperate not only within one company but also with the entire supply chain. Therefore, it can be said that the development of an Internet environment and security measures with a bird's-eye view of the supply chain are also major challenges.
As a solution, it is essential to formulate a security measures manual and thoroughly educate employees (including those in the supply chain) on security.
Summary: The key to realizing Industry 4.0 is creating an environment and developing human resources
Industry 4.0 began in Germany in 2011. The realization of smart factories enables various innovations such as efficient production of small quantities of a wide variety of products and high value-added products, and full automation of factories.
However, the problem is that it has not been widely adopted in Japan and is starting to fall behind the global trend. There are many issues such as a shortage of human resources, national support systems, and the development of an Internet environment, but the world has already begun to evolve, so we cannot afford to fall behind any further.
In order to advance Industry 4.0 in Japan from now on, it is important to improve the Internet environment and security measures throughout the manufacturing industry, assuming national support. In addition, hiring and training IT personnel is also essential. First of all, recognizing the importance of Industry 4.0 and promoting both environmental development and human resource development will lead to the realization of Industry 4.0.
