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The Future of Manufacturing: Industry 4.0

The Future of Manufacturing: Industry 4.0

Germany today is awash in conversations regarding an initiative known as “Industry 4.0.” I just returned from the Hannover Fair in Germany. As it was explained to me, Industry 4.0 began as a German government initiative to spur the industrial sector, which is very important to the German economy.

We hear all manner of conjectures about the future of manufacturing. Some worry about the new generation of engineers, managers and technicians. Others worry about corporate management’s lack of understanding of manufacturing and the subsequent devaluation of manufacturing as a strategic corporate resource.

I read “The Second Industrial Divide,” a 1986 book in which the authors (Michael Piore and Charles Sabel) argue that there were two industrial “divides,” meaning that we were just then about to enter the third phase of manufacturing.

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The first industrial divide was the Industrial Revolution, where steam- and water-powered mechanical machines assumed much of the work of individual artisans. The first divide happened, and then we found ourselves in the second industrial revolution of mass production. The authors argue there would be a new phase after the second great divide, one in which there would be a combination of the two—sort of a return to artisans, but within the mass-production model.

Germany today is awash in conversations regarding an initiative known as “Industry 4.0.” I just returned from the Hannover Fair in Germany. As it was explained to me, Industry 4.0 began as a German government initiative to spur the industrial sector, which is very important to the German economy. The government even contracted with what we would call a “think tank” to define the concept.

Siegfried Russwurm, member of the executive committee of Siemens AG ( and also CEO of Siemens’ Industry group, defined the 4.0 concept during the company’s press conference in Hannover.

Industry 1.0 was based on the introduction of mechanical production equipment driven by water and steam power, he said. Industry 2.0 was based on mass production achieved by division of labor and the use of electrical energy. Industry 3.0 was based on the use of electronics and IT to further automate production, Russwurm said. Industry 4.0 was based on the use of cyber-physical systems.

“Cyber-physical systems” was defined by the think tank contracted by the German government, Russwurm said. Actually, James Truchard, president and CEO of National Instruments (, promulgated this concept in a presentation in 2006. Those familiar with NI know about its founding concept of a “virtual instrument”; that is, doing instrumentation in software. In this case, he was referring to a virtual representation of a manufacturing process in software. Think simulation, for example.

Humans needed
If this sounds like a lot of automation and computerization, it is. But Russwurm, formerly head of human resources for Siemens, responded that humans will always have a place in manufacturing. “Humans conceptualize, design the product and determine production rules and parameters. CPS (or virtual manufacturing) simulates and compares production options on the basis of instructions, then proposes compliant ‘optimal’ production paths. Step 5 is selection of an optimal production path and implementation of product.”

Festo also emphasized Industry 4.0 in its discussion with me in Hannover. As its spokesman explained, “In the era of Integrated Industry, individual workpieces will themselves determine what functions they need production installations to provide. An important milestone on the road towards Integrated Industry is the concept of integrated automation from Festo, based on the automation platform CPX.”

This represents a shift from rigid, centralized factory control systems to decentralized intelligence. “Tasks that are currently still performed by a central master computer will be taken over by components,” predicted Peter Post, head of corporate research & program strategy at Festo. “These will network with one another in an intelligent way, carry out their own configuration with minimal effort and independently meet the varying requirements of production orders.”

The German companies took great pains to explain how they already have products that meet Industry 4.0. Meanwhile, in the United States, an initiative known as the Smart Manufacturing Leadership Coalition (see is also working on the future of manufacturing and, in my opinion, is seeking a more comprehensive model. We’ll see what happens.

>> Gary Mintchell,, is Founding Editor of Automation World.

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