What is industry 4.0?

 

Adaptation and Adoption of Industry 4.0 in Cambodia

The report released in 2020 and written by Jennifer Castañeda-Navarrete, David Leal-Ayala, Carlos López-Gómez and Michele Palladino described what industry 4.0 is.

 

WHAT IS INDUSTRY 4.0?

 

 

Key points of this section

·      Industry 4.0 describes the widespread integration of information and communication technology (ICT), particularly cyber-physical systems (CPS), in industrial manufacturing.

·    The term Industry 4.0 has not been used consistently, because of the diversity of trends, technologies and applications associated with it.

·    While the scope of Industry 4.0 is industrial manufacturing, the term “Fourth Industrial Revolution” is associated with a wider range of technologies (including biotechnology, nanotechnology and new materials) and their application across all sectors of the economy. Meanwhile, “Digital Economy” primarily refers to the trade of goods and services through electronic commerce.

·         The use of sound definitions is necessary to appropriately identify policy areas that are relevant to support the adaptation and adoption of Industry 4.0 and to enable communication and collaboration between the relevant stakeholders.

1.1 Introduction

Technology adaptation and adoption are widely regarded as drivers of industrial and economic progress. These processes have underpinned the catch-up experience of countries such as Japan, Germany, South Korea and Singapore.2 In particular, this project focuses on the opportunities and challenges arising from the adaptation and adoption of “Industry 4.0”, and the policy responses for addressing them.

The term Industry 4.0, or “Industrie 4.0”, was introduced in 2011 as part of the German government’s High-Tech Strategy. Since then, Industry 4.0 has emerged as one of the most important themes in the national industrial and innovation agendas of both developing and developed countries. The term, however, has not been used consistently, because of the diversity of trends, technologies and applications associated with it. The boundaries of Industry 4.0, and its interfaces with concepts such as “Fourth Industrial Revolution” and “Digital Economy”, are not well understood. This has important implications for policy design, as the lack of clarity in definitions results in uncertainty regarding the subject of investigation and the relevant policy areas.

 

To contextualise this investigation, this section discusses the concept of Industry 4.0, including common definitions and associated technology trends. The section also introduces relevant frameworks to characterise the value capture opportunities arising from Industry 4.0; and it describes the “digitalisation journey” that firms need to undergo in order to exploit these opportunities.

1.2 Industry 4.0 – a working definition

Industry 4.0 refers to the widespread integration of information and communication technology (ICT), particularly cyber-physical systems, in industrial manufacturing. Cyber-physical systems use sensors, actuators, control processing units and communication devices to link the “cyber” world (e.g. software, computational algorithms and wireless communication) with the “physical” world (e.g. machines and human users).

In short, Industry 4.0 refers to the widespread integration of information and communication technology (ICT), particularly cyber-physical systems (or CPS), in industrial manufacturing.3 Cyber-physical systems are engineering systems that link the “cyber” world (e.g. software, computational algorithms and wireless communication) with the “physical” world (e.g. machines and human users). These systems comprise a set of networked agents, including: sensors,

actuators, control processing units and communication devices.

 

Because cyber-physical systems generate data that enables “smarter” analysis and decision-making, they constitute the basic principle behind a wide range of so-called “smart” applications that go beyond manufacturing. Cyber-physical system applications used in energy distribution are often labelled “smart grids”, applications in transportation are often called “smart mobility” and those in health care are often known as “smart health” – and so on.

More generally, the application of digital technologies across the whole economy has given rise to terms such as “smart cities”, “digital government”, “digital economy” and “digital society”, and the “Fourth Industrial Revolution”. Figure 1.1 provides a simplified illustration of the interfaces between these terms, and Table 1.1 lists some of the most widely used definitions.

In full: https://www.kh.undp.org/content/dam/cambodia/docs/ResearchAndPublication/2020/Industry%204.0%20Report%20Final.pdf