industry 4.0 what is it

It’s no secret how much the world has changed since the First Industrial Revolution. Since then, new technologies have been introduced to automate and improve the activities of companies continuously.

Such transformations, however, always force companies to have to adapt, invest and change their mindset. With Industry 4.0 the story is no different. You need to think of new solutions to survive in the market. The Internet of Things (IoT) is an example of innovating and seizing this moment.

However, it is very challenging, especially for more traditional companies, to put innovative actions into practice, right? But, there are ways to run your business well in a scenario of constant change. Want to know how? So, read on!

Concept and importance of industry 4.0

PTo understand the concept of industry 4.0 it is necessary to keep in mind what sets up a transformation scenario: the existing technology combined with market demand. Therefore, the connectivity model, so characteristic of the current moment, was only possible with the popularization of the internet in the 1990s.

Let’s take a brief journey into history. In 1990, there was World Web Wide, Dial up, TCP/IP and xDSL technology. It also had a market that needed to communicate more quickly and efficiently. Result? Global interactions, new form of entertainment and cheaper communications.

Since then, we have only evolved. In the 2000s, the internet became mobile. In 2015, the internet of things emerged, which is revolutionizing the industrial segments through electronic integration and transaction, optimizing production processes.

In this context, industry 4.0 can develop and consolidate as a new era for companies. Although much is said about this change in the industry, the term only appeared in 2001 at the fair in Hannover (Germany) and covers all technological innovations in the fields of automation, control and information technology. The main purpose of this industry is to connect machines, systems and assets to create smart grids to help production.

Industry 4.0 is guided by five pillars:

optimised operational capacity to receive and analyse data volumes with agility;

  • virtualization of information that allows to faithfully reproduce the operation of factories in the virtual environment to monitor and track processes remotely;

  • decentralisation of work involving the improvement of production processes by means of intelligent modules;

  • targeting services with specific software for this;

  • modularity that aims to make tasks more flexible and change devices easily.

    In addition to these bases, we can note the industry 4.0 in several other fields of technology, such as IoT, which goes beyond the connectivity of objects. The goal of the solutions that emerge in this area will be to supply the retail big data, collecting data and making correlations to guide strategies for the business.

Quais os desafios da indústria 4.0?

Industry 4.0 shows promising numbers. For the IoT market, for example, the projection is that by 2025 there will be fixed and short-range applications for everyone, such as smart watches, devices associated with smartphones, smart Metering (smart electricity meters), among others.

Development will be so rapid in the field of the internet of things that the estimate is that by 2025 there will be seven billion connected devices using IoT and mobile networking.

However, although the entire transformation of the industry is inevitable, many challenges prevent companies from investing in industry 4.0. The biggest one is maintaining data security. As connectivity is essential in this business model, you need to worry about cyber crime.

One of the ways to overcome this obstacle is to invest in appropriate devices to ensure digital security, think about the encryption of information so that everything is properly stored and transported, without third-party intervention.

Another challenge is people. As much as change is necessary, many have resistance to novelties, as they are used to the status quo. It is difficult to convince and change the mindset of employees of your business, including decision makers.

The tip to try to implement a new culture and business vision is to start in smaller sectors and do all actions gradually. Avoiding sudden breakups can be the way to accept transformation. In addition, it is important to empower the team to be prepared with the impacts on their routine.

Finally, the third biggest challenge of Industry 4.0 is diversity. Whatever technology or process is implemented, the company needs to be able to filter the various data that arrives, separating what is most relevant.

How can the entrepreneur be part of this new industry?

Overcoming obstacles and innovating, not only to survive, but to excel in an ever-changing world is not an easy task. However, there are ways to improve your company’s performance: transforming leaders' mindset and work culture.

How to do that? Well, according to Clayton Cristensen, author of "The Innovation Dilemma," there are three ways companies innovate to grow. They are:

desafio das industria 4.0
desafio das industria 4.0

Invest in new markets

Many companies, especially the more traditional ones, fall into the trap of focusing only on one market and cannot see the possibility of exploring other niches.

However, investing in new markets is not simple. It takes a lot of resources, research and development, and can take years to bring results. However, from the moment the main segment grows, it starts to attract potential customers who were not always on the radar of the business. These data, little checked by managers, are fundamental to guide new ventures.

Add value in existing products

If it is difficult to open new branches of the company, how about adding value to existing services or products? This is another way to innovate and follow the development of Industry 4.0.

A good way to value your offers is to better relate to customers and understand what needs have not yet been met. Thus, it is possible to develop actions to improve your portfolio. Although it is an interesting solution, its return may be less than diversifying the market.

Focus on efficiency

The third step to grow in Industry 4.0 is to make the company more efficient, that is, cutting costs to accelerate development. Although it is an option that brings quick return in the short term, it is not enough to transform the company in fact, unless it is allied to other actions.

However, it is no use investing in these paths if the company culture does not undergo transformations. In Industry 4.0, exponential culture is essential for the company to remain in the market.

According to Salim Ismail, author of the book "Exponential Organizations", leaders in large companies will have to stop commanding and controlling their teams. It is necessary that the team has autonomy to create and perform their tasks. For this, companies need to equip employees with tools that stimulate this process, such as multidisciplinary teams and clear goals.

Companies considered the most innovative in the market, such as Google and Spotify, for example, operate in a decentralized manner and give their employees autonomy. With OKR’s and Squads, they have implemented management methods to organize teams simply and efficiently for development in the market.

And why invest in this model? Because they allow quick responses, more adaptability and flexibility in decision making, which are essential characteristics for those who want to innovate. In addition, it stimulates horizontal hierarchies and can offer more efficient solutions to consumers, who are increasingly demanding when it comes to speed and quality, whether in products or service.

Salim Ismail also adds that it is necessary to generate an entrepreneurial mindset to employees, something that is the opposite of management structures in most organizations. For this, managers need to make clear what the purpose of the business, what the author calls MTD (Massive Transformative Purpose or Massive Transformative Purpose).

The MTD is a phrase that shows the direction of the company and that unites the team. Most exponential companies have an MTD: TED’s, for example, is "Ideas worth spreading", Apple’s is "Think Different". They show the essence and aspiration of the company, in addition to proposing radical changes.

The MTD is not only for the people who work in the company, but extends to stakeholders (suppliers and users), bringing more engagement to the brand and, consequently, more access to new ideas.

Whether practicing the exponential culture, investing more in new markets or in technologies such as IoT, the most important thing is to have the perception that industry 4.0 is a reality. Therefore, it calls for disruptive changes, both for society and for business. Driving such transformations is critical for your business to thrive. How about starting to change the mindset and innovate today?

tripulação ET
tripulação ET

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