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Industry 4.0 is much more than production automation

Consulting company Ernst & Young has focused on industrial SMEs and found that mechanical engineering invests more than average in digitization. Small industrial companies, however, may be left behind.

07 May. 2018
Industry 4.0 is much more than production automation (Chart: Ernst & Young GmbH)

More than 1,150 medium-sized industrial companies in Germany were surveyed for the “Industry 4.0 in German SMEs” study . 54% of them already produce at least partially digitally controlled . However, only 5% are largely or completely digitally networked. The share of total sales with products manufactured using Industry 4.0 technologies is on average 31% for the companies that use them. It is also significant that for 80% Industry 4.0 simply means production automation. By contrast, robot process automation and artificial intelligence are still not very prevalent at 18% and 11% respectively in SMEs.

The mechanical engineering industry invests an above-average amount in Industry 4.0 with just under 4% of its total turnover, according to another study. On the other hand, in terms of revenue generation, electrical engineering is ahead with 47%, followed by the food industry (42%). However, small industrial companies may be left behind, the consultants warn. They would not have to be first-time users and don’t necessarily need to develop their own solutions. But they would have to find ways to keep up with the big companies, for example, through cooperation with other medium-sized companies, startups or cloud services. Action is needed above all in production, IT, as well as research and development. This was already demonstrated in a study conducted by Computerwoche and other partners last year. Most of the obstacles mentioned there were excessive costs, lack of know-how, and other priorities.