How German companies seize the chances of Industry 4.0

© Christian Kruppa

More and more machines are connected to the internet setting the course for Industry 4.0 – the fourth industrial revolution. After mechanisation (Industry 1.0), mass production (Industry 2.0) and automation (Industry 3.0), the “internet of things and services” is now becoming an integral part of manufacturing. Industry 4.0  paves the way for personalised products, resource-efficient logistics, new services and a more flexible working environment. To reach its full potential, Industry 4.0 needs an innovation friendly regulatory framework.

Core of Industry 4.0 are intelligent machines that share information with one another, organise themselves and work together to coordinate processes and deadlines. This makes production much more flexible and efficient. In addition, the intelligent machines communicate directly with IT systems in a company. In the interplay with smart products, this technological quantum leap allows for the creation of new business models that create added values for customers. There are already many practical examples in Germany that demonstrate the broad field of application for Industry 4.0 solutions and related services.

German companies among the leaders of the fourth industrial revolution

Germany has the potential to evolve as a leading market and supplier for Industry 4.0. German-based companies are global leaders in important high-tech industries such as machinery, automotive, chemicals, pharmaceuticals, electronics and aerospace. Moreover, German companies are among the world’s leading providers of enterprise software. Some enterprises already employ more IT professionals than traditional engineers. They program operating systems for machinery, convert sensor data into valuable new information and integrate embedded systems in a growing number of products. Customers all over the world benefit from this unrivalled expertise when it comes to developing highly innovative digital solutions for the business-to-business (B2B) sector. 

Digitising industrial production across borders

In order to fully exploit the potentials of Industry 4.0, the German industry is taking an active role in promoting the networking of machines and processes across borders. To this end, companies as well as Industry 4.0-related initiatives exchange best practice solutions with international partners. Moreover, common challenges such as cyber security or standardisation issues are being tackled on a global level. As a precondition for Industry 4.0 throughout the whole supply chain, international cooperation will be among the top priorities of the German industry for the upcoming years, too.

Smart regulation for smart products and services

Companies that invest in Industry 4.0 technologies and the creation of new business models are highly dependent on the regulatory framework, as legal provisions can relieve or impede the adaption of new digital solutions and the cooperation with companies abroad.Therefore, governments have to set the right framework that facilitates innovation and cross-border cooperation in the area of Industry 4.0. Examples are a balanced legislation in the field of data protection and the support of international standardisation efforts. All activities of the Federation of German Industries (BDI) are directed at ensuring an innovation friendly regulatory framework.