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Why Industry 4.0 Means Businesses Must Revolutionize Or Stagnate

Why Industry 4.0 Means Businesses Must Revolutionize Or Stagnate
This post explores why Industry 4.0 means companies must revolutionize. The transition process might not be pleasant, but it is essential.

Industry 4.0 is just around the corner. While murmurings of its existence go back to the early 2000s, it is only now that artificial intelligence is reaching the point where it is becoming possible. Self-directing systems can now carry out vital functions in supply chains, improving the production, movement, transport, and distribution of goods around the planet. 

However, it is a double-edged sword, as it is with any technological innovation. While the net effect is usually positive, these innovations can cause some firms to go out of business. 

This post explores why Industry 4.0 means companies must revolutionize. The transition process might not be pleasant, but it is essential. 

Efficiency And Productivity

The main reason Industry 4.0 is forcing businesses to revolutionize is the efficiency and productivity it offers. Companies that fail to adopt the latest technologies risk seeing their margins squeezed as competitors bring down prices and offer consumers higher-quality services. 

The productivity gains could be tremendous. Estimates suggest that companies could see gains of 100 per cent over the long term, meaning they could be twice as productive with their inputs as they are today. 

Competitive Advantage

Related to this, industry 4.0 also means that firms can gain a new source of competitive advantage. Imagine for a moment your firm suddenly built out its industry 4.0 capabilities. You’d be able to produce and move goods inexpensively compared to competitors, increasing your margins and giving you more opportunities to profit. 

Customers could also benefit. Instead of having to make do with slow delivery times and poor product quality, you could offer them something better for the same price they pay today. 

What’s great about Industry 4.0 is that you don’t need to be 100 percent better than your competitors to shift demand in your direction. Just a 10 percent improvement can result in massive shifts in your direction. 

Data-Driven Decision-Making

Switching to Industry 4.0 can lead to more data-driven decision-making. This is something we are seeing in mining digital transformation. Companies are making more choices based on data and less on experience or intuition. 

Data-driven decision-making helps to take bias out of the equation. It makes it more straightforward for executives to look at their business situation for what it is. 


Another reason Industry 4.0 means businesses must revolutionize is sustainability. Technologies can help firms deliver services to consumers in a planet-friendly manner. 

As many firms are now recognizing, the business case of going green is stronger than ever. Informed, wealthy consumers the world over are demanding it. 

Industry 4.0 assists sustainability by improving efficiency and reducing energy and material inputs. Sophisticated systems make it possible to do more with less. 


Finally, the switch to Industry 4.0 means that businesses are going to have to become more flexible. Business models won’t remain the same once the change occurs. 

For example, consumers will get used to rapid delivery. And industry rivals will implement tactics that let them adjust to changes in demand quickly. 



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