The fourth industrial revolution, already underway, is changing the way goods are manufactured. 5G will be instrumental in helping it fulfill its vision.
The Internet of Things (IoT), artificial intelligence, ubiquitous wireless connectivity, mixed reality, blockchain, autonomous vehicles, the cloud - these and countless other recent developments are changing the way industries operate. The merger of digital and physical systems into the Industrial Internet of Things (IIoT) – a vast network of connected devices that generate data that is analyzed on the cloud before being somehow acted upon – is one of the fundamental building blocks of the connected industry, or Industry 4.0.
Leveraging advances provided by 4G LTE, industries are embracing these emerging technologies to streamline their operations, increasing their efficiencies, and ultimately, growing their productivity. It’s a trend that will only accelerate as we enter the 5G era.
This transition changes the entire logic on the factory floor, where a heavily fragmented market of wired technologies still dominates today. Today’s manufacturing sites, for example, are made up of an archipelago of “connectivity islands” that are separated by gateways at the field level. Because existing technologies are not designed for interoperability, simply getting different industrial networking technologies to connect requires a series of protocol translations.
Contrast that to Industry 4’s promise of full transparency across all processes and assets at all times, with seamless communication between goods, production systems, supply and distribution chains, people, and processes on the back of robust, and reliable wireless connectivity. The shift from today’s factories to tomorrow’s smart ones sounds like wishful thinking. The fact that several industries, from automotive to aviation to fashion, have already embraced this new paradigm proves that it is not.
Pilot studies, such as 5G‑SMART, carried out by the 5G Infrastructure Public Private Partnership, further substantiate these claims. Bringing together partners from industry (Bosch, ABB, and Ericsson, among others) and research (Lund University, Universitat Politechnica de Valencia, Fraunhofer Institut), the project is evaluating the potential of 5G in real manufacturing environments. u‑blox is engaged in a work package focusing on real‑time workpiece monitoring during machining and adaptive manufacturing, as well as shop floor monitoring for digital twins.
New emerging business models
But it isn’t just operations that are being redefined. Entire business models that underpin industries are being shaken up. The driving force behind the shake up is clear: access to data. With the ongoing industrial revolution, data is rapidly gaining in strategic value as an enabler of real‑time quality control, predictive maintenance, integrated supply and distribution chains, workforce monitoring, and more. At the same time, and across industrial verticals, data is being generated faster than ever before.
Take utilities, where the availability of data is redefining business and has vastly more potential to do so, as McKinsey highlights. Data is instrumental in aligning supply and demand as decentralized power production makes the electrical grid more complex. Data enables condition‑based maintenance of assets, and underpins online energy marketplaces for prosumers. Finally it increases the efficiency of day‑to‑day operations, simply by getting the right data to the right people at the right time.
But it isn’t just business models that are being disrupted. Here are some more ways we see Industry 4.0 changing the way industries operate.
Industry 4.0 is moving production closer to customers. Industry 4.0 is reversing and decades‑old trend of globalization and mass production of goods, starting in the automotive industry. Many of today’s major carmakers operate under new paradigms. “Single piece production” has mass produced goods customized down to the individual unit. And in the case of “Today’s order is tomorrow’s delivery,” the name basically says it all. Now, these ways of operating are moving into other consumer goods, from shoes to furniture to other equipment. The only way to be nimble enough to respond to customer demands is by moving production capacity close to customers.
Industry 4.0 makes the entire product development process fully traceable. Full traceability means that those managing operations can know the exact source of each piece used in the production of every single device. But it doesn’t stop there. By monitoring data and using predictive maintenance, fielded devices can be continually monitored, revealing weaknesses in the manufacturing process that can be addressed to improve the quality of future products. And customers reap the benefits of a new level of data- and insight‑driven service and support.
By embracing wireless technologies, Industry 4.0 makes manufacturing more agile and more versatile. Because they are easier to deploy, wireless technology such as 4G LTE LPWA and 5G reduce the investment involved in gather huge amounts of sensed data. It accelerates implementation in existing and new installations. It provides higher quality information and improves operator safety. And finally, it is much more flexible and easier to scale.
 The Digital Utility: New challenges, capabilities, and opportunities, McKinsey and Company, June 2018