What is Industry 4.0—the Industrial Internet of Things (IIoT)?

Industry 4.0 refers to a new phase in the Industrial Revolution that focuses heavily on interconnectivity, automation, machine learning, and real-time data. Industry 4.0, also sometimes referred to as IIoT or smart manufacturing, marries physical production and operations with smart digital technology, machine learning, and big data to create a more holistic and better connected ecosystem for companies that focus on manufacturing and

supply chain management. While every company and organization operating today is different, they all face a common challenge—the need for connectedness and access to real-time insights across processes, partners, products, and people. That’s where Industry 4.0 comes into play. Industry 4.0 isn’t just about investing in new technology and tools to improve manufacturing efficiency—it’s about revolutionizing the way your entire business operates and grows.

Evolution of Industry from 1.0 to 4.0

Before digging too much deeper into the what, why, and how of Industry 4.0, it’s beneficial to first understand how exactly manufacturing has evolved since the 1800s. There are four distinct industrial revolutions that the world either has experienced or continues to experience today.

The First Industrial Revolution

The first industrial revolution happened between the late 1700s and early 1800s. During this period of time, manufacturing evolved from focusing on manual labor performed by people and aided by work animals to a more optimized form of labor performed by people through the use of water and steam-powered engines and other types of machine tools.

The Second Industrial Revolution

In the early part of the 20th century, the world entered a second industrial revolution with the introduction of steel and use of electricity in factories. The introduction of electricity enabled manufacturers to increase efficiency and helped make factory machinery more mobile. It was during this phase that mass production concepts like the assembly line were introduced as a way to boost productivity.

The Third Industrial Revolution

Starting in the late 1950s, a third industrial revolution slowly began to emerge, as manufacturers began incorporating more electronic—and eventually computer—technology into their factories. During this period, manufacturers began experiencing a shift that put less emphasis on analog and mechanical technology and more on digital technology and automation software.

The Fourth Industrial Revolution, or Industry 4.0

In the past few decades, a fourth industrial revolution has emerged, known as Industry 4.0. Industry 4.0 takes the emphasis on digital technology from recent decades to a whole new level with the help of interconnectivity through the Internet of Things (IoT), access to real-time data, and the introduction of cyber-physical systems. Industry 4.0 offers a more comprehensive, interlinked, and holistic approach to manufacturing. It connects physical with digital, and allows for better collaboration and access across departments, partners, vendors, product, and people. Industry 4.0 empowers business owners to better control and understand every aspect of their operation, and allows them to leverage instant data to boost productivity, improve processes, and drive growth.