Industry 4.0: Expectations vs. Reality

In this article, CodeMerx is on a mission to distinguish the Industry 4.0 expectations vs. reality! The Fourth Industrial Revolution, consisting of robots, big data, cloud computing, IoT, and many more smart technologies has created a competitive advantage for their early adopters. We dive deep into the real meaning behind the term and current actions that have been taken by some companies.

Lately, Industry 4.0 has turned out to be a very buzzword. Therefore, it becomes an unclear definition that can trick many. Even though the term may sound too high-tech for some people, in reality, the solutions provided by the Fourth Industrial Revolution are relatively easy to understand and even implement. However, one of the biggest barriers to adopting them is the required cost. But even if the resources are invested, how efficient will it be?

The hype of Industry 4.0

The Fourth Industrial Revolution is considered to bring great business opportunities such as Predictive Manufacturing. In addition to this, it is used for overall optimization to increase productivity and multiply the options for customization. Hence, the implementation of smart technologies and tools becomes a desired action by many businesses to gain a competitive advantage.

The essence of Predictive Manufacturing is to monitor and keep control over the production processes and machines. Further, smart devices representing the Internet of Things (IoT) give insights into the age and physical state of the machinery (Chowdhury, 2021). Thus, their maintenance or replacement can be predicted. Additionally, the cause of the problem in the machines can be identified faster. In this way, the business analyzes its data to optimize its assets and systems with the intention of making them as efficient as possible.

According to the survey of Passinger (2020), the most desired outcomes of Industry 4.0 are related to:

  • employee safety (36,2%)
  • asset/material/product flow (25%)
  • forklift/fleet tracking (23,2%)
  • research (8,3%)
  • tools tracking (3,3%)
  • picking & AR (1,4%)

Their research shows that the second main reason why companies implement smart technologies is due to tracking and optimizing their production processes. Meanwhile, the most important cause why they invest in Industry 4.0 is their employees’ safety. As the technologies can define and predict the state of the machinery, it is beneficial for preventing injuries of the staff.

All of this information excites so many business owners, CEOs, CTOs, CIOs, etc. However, how viable are these promises? Let’s look into what is beyond this hype.

The reality behind Industry 4.0

However, the results of the research showed up to be a bit more different than what the companies expected. According to the study of Passinger (2020), the delivered outcome of the implementation of Industry 4.0 technologies looked like this:

  • asset/material/product flow (40,5%)
  • employee safety (24,3%)
  • forklift/fleet tracking (18,9%)
  • research (8,1%)
  • tools tracking (2,7%)
  • picking & AR (2,7%)

The biggest change is between the first 2 parameters. The results show that smart technologies make the most impact within the asset/material/product flow. Contradictory to the expectations, where employee safety was the most desired outcome. Besides that, there are slight changes in the last 3 parameters, yet they are not so significant. Therefore, the expectations meet the reality in their case.

Further, insufficient data may interrupt the accuracy of the predictions (Chowdhury, 2021). Hence, only age-related factors are available. In this case, the sole solution is the implementation of more sensors in order to be able to access as much data as possible. 

However, not many companies can afford even the basic supply with Industry 4.0 technologies, while the business risks are also big. Also, it cannot be cut on costs, as lower quality sensors equal lower quality data, thus, it decreases the efficiency and usefulness of the whole project (Chowdhury, 2021). In general, the only option is to fully equip the system which as discussed is costly.

Another challenge is that certain businesses require integration with the data of their partners such as suppliers or clients. For instance, a company that produces construction materials needs data from its metal suppliers when they are going to deliver the iron. Thus, cooperation between the business associates is required in order to build synchronized systems. But are their partners have enough resources to implement it?

To summarize, we have created the table below regarding the advantages and disadvantages of the integration of Industry 4.0.

Table 1. Benefits and drawbacks of integrating Industry 4.0 technologies.

Choosing whether to become part of the Fourth Industrial Revolution is a crucial decision for whether you can cope with the competition and clients’ demands. However, some businesses may not be able to afford it without looking for investment partners or withdrawing loans. In this case, the risk and need should be evaluated. For instance, if your company isn’t in the production industry or hasn’t scaled enough, adopting Industry 4.0 is not explicitly necessary as an investment. However, if you experience delays in your custom orders, or the capacity of your production could be more efficient, then smart technologies should be implemented. Also, a good practice is to consult with your partners. In this way, you may lower your costs and achieve a better flow of data.

To conclude, Industry 4.0 meets most of its expectations, but it is a risky and costly investment. Thus, cost-benefit analysis should be made, as well as risk analysis for a better decision-making process.


Chowdhury, H. R. (2021, January 4). Predictive Maintenance in Industry 4.0: Expectations vs Reality. Enquete Group.

Passinger, P. (2020, January 28). [Infographics] Industry 4.0: Expectations vs. Reality. Sewio RTLS.

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