Industry 4.0


Industry 4.0 is the name used for the emerging ’fourth industrial revolution’ and refers to the digitalisation of manufacturing industry technologies and processes. While Industry 3.0 focused on the performance of single machines and processes, Industry 4.0 is concerned with integration across the entire production value chain.

Industry 4.0 is made possible by the convergence of automation and data exchange technologies in manufacturing. Industry 4.0 factories are characterised by wireless connectivity and self-regulation, with end-to-end production possible without any direct human intervention.

Industry 4.0 technologies have potential to enhance competitiveness, and can help address common industry challenges such as high labour costs and distance to markets. Technologies relevant to Industry 4.0 include:

  • smart sensors
  • big data analytics and advanced algorithms
  • advanced robotics
  • Internet of Things (IoT) platforms
  • mobile devices
  • location detection technologies
  • advanced human-machine interfaces
  • 3D printing
  • multilevel customer interaction and customer profiling
  • cloud computing and data visualisation
  • virtual and augmented reality.

Productivity benefits

Industry 4.0 offers opportunities to save energy while improving energy productivity, and may help manufacturers remain competitive in tight markets. The transition to smart, connected industry will enable greater control of energy costs. Industry 4.0 can enhance business productivity by supporting:

  • improved energy efficiency, optimised energy-use, and reduced carbon emissions
  • increased production output and product improvements across the value chain
  • improved plant reliability, better product quality and reduced maintenance costs
  • increased deployment of onsite renewable energy in the manufacturing process
  • better connectivity with customers and supply chains
  • greater flexibility to produce differentiated products
  • enhanced workplace safety and labour utilisation.

Industry 4.0 goes beyond the capabilities of individual technologies. Instead, it embraces new ways technologies can combine to create new business models and modernise production processes.

Many of the measures recommended to optimise energy use in manufacturing, such as energy use monitoring, enable the transition to Industry 4.0. Undertaking an assessment of a company’s digital maturity can help managers understand what’s feasible within existing constraints, and where new resources might be needed.

Extensive monitoring

Improving the energy productivity of processes relies on understanding energy use at each stage of production. Extensive digital monitoring infrastructure is not just an enabler of better energy management. It also allows precise control and enhanced integration – essential foundations of Industry 4.0.

Digital metering and monitoring equipment is increasingly affordable, and provides fine data resolution for assessment and optimisation.

See the Metering and monitoring guide for more information.

Big data analysis

Large manufacturing plants can have hundreds of sensors generating massive amounts of data each day. This data can be now be processed using artificial intelligence techniques. In addition to powerful computer hardware, sophisticated data analysis software is turning huge quantities of data into useful business information.

Digitally enabled equipment

An increasing number of products such as pumps and variable speed drives (VSDs) come equipped with on-board digital monitoring and control features. Such products enable decentralised control and easy integration into the broader production system.

Internet of Things (IoT) production systems

IoT refers to systems of interconnected devices with unique identifiers, enabling secure connection and data exchange. IoT platforms coordinate information from a range of sources through a common language, allowing them to co-operate with each other.

IoT can improve labour productivity and enables production to be monitored remotely for easy oversight via mobile device apps.

Real-time energy management

Industry 4.0 has the potential to instantly identify and address unusual or excessive energy use from various production components. Real-time energy management can help avoid high-standing energy losses from equipment by sensing when it’s not being deployed productively. The resulting corrections will then become business as usual.

Production flexibility

Industry 4.0 systems can be more responsive to customer demand and enable cost-effective operation at smaller production levels. Traditional operations have focused on the economic benefit of high-volume production, while smaller runs meant higher costs per unit.

This inflexibility can be partly addressed through improved monitoring and controls facilitated by Industry 4.0. This can also assist investment in VSD technologies and replacement of large capacity production equipment with multiple smaller units.

Renewables and demand management

Australian manufacturers are increasing investment in solar PV as prices continue to fall, but sometimes neglect optimising the intermittent nature of the generation. Similarly, companies are pursuing renewable power purchase agreements (PPAs) but these provide cheap energy only while generation output is high.

Industry 4.0 technologies help optimise integration of renewables by enabling predictive demand management and storage strategies. This minimises or even negates the need for additional energy sources.

Logistics planning and supply chain optimisation

Digital trends such as electric transport, autonomous systems, and digital warehousing are rapidly converging. This brings the opportunity for improving company logistics and supply chain operation. Industry 4.0 can connect the factory to the supply network, and inform planning and inventory processes. Industry 4.0 can also reveal opportunities for new business models along the entire life cycle, from production through to end-of-life/recycling phases.

Education and upskilling

As Industry 4.0 technologies transform manufacturing systems, the skills needed by workers will also change. Businesses that foster certain skills will be better placed to take advantage of the benefits. Advanced technical knowledge will be of increasing value, while managers will need the capacity to respond strategically to emerging trends.

Higher Apprenticeship Program

The Australian Government’s Industry 4.0 Higher Apprenticeship Program trains technicians to a higher skill level for the economy of the future. As part of the program, apprentices enrol in an associate degree which covers topics including advanced manufacturing processes, automation and robotics, IoT, cloud computing, advanced algorithms and smart sensors.


Digital twin

A key innovation in smart manufacturing is the concept of the digital twin -- a digital model or copy of a physical product, process or operation. The digital twin approach means products can be designed and tested in a virtual environment prior to actual production. This allows rapid performance prototyping and reduced production time and cost. Digital twins can also be used to model various production scenarios and identify the most efficient operational strategies.

Additive manufacturing – 3D printing

Additive manufacturing is so-called as it adds, rather than removes, material to create an object. 3D printing is the most common application of the approach. Additive manufacturing can significantly reduce energy use, waste and materials costs, and production time.

The method also allows for greater design flexibility and increased product individualisation. Additive manufacturing can overcome the need for long-distance transportation of items (such as spare parts or tools) that can instead be 3D-printed at remote sites.


Blockchain technology is designed to facilitate and record digital interactions in a manner that is secure, transparent and labour-efficient. It can be used to track any kind of shipment or transaction and thereby support sustainable procurement and supply chain operations. Blockchain saves costs and time, while streamlining production, assembly and quality control processes.

Advanced Manufacturing Growth Centre

The Advanced Manufacturing Growth Centre (AMGC) is an industry-led, not-for-profit organisation established in 2015 as a key plank of the Australian Government’s Industry Growth Centre Initiative. Its goal is to drive innovation, productivity and competitiveness across Australia’s manufacturing industry.

The AMGC engages with manufacturers and universities in high-impact projects and export hub opportunities on how the industry can transform to become more advanced.

AMGC membership is open and free of charge, with likeminded manufacturers and research institutions encouraged to join. See the AMGC website to become a member.

Innovative Manufacturing Cooperative Research Centre

The Innovative Manufacturing Cooperative Research Centre (IMCRC) is a not-for-profit, independent cooperative research centre that aims to encourage and help manufacturers invest in collaborative research to exploit innovative technologies. A key component of this is assisting companies to leverage digital technologies in order to deliver intellectual property, customisation and business models to sell new products and services to a global market.

In collaboration with companies, research organisations, industry associations, and government, IMCRC co-funds industry-led manufacturing research projects by matching industry cash contributions dollar for dollar. So far, more than $30m of Commonwealth funding has been invested to advance innovative manufacturing in Australia.

See the IMCRC website for more information including how to apply for funding.

CSIRO’s Innovate to Grow Program

CSIRO, Australia’s national science agency, equips small to medium sized businesses (SMEs) with the knowledge and tools required to progress their research and development (R&D) opportunities through its Innovate to Grow Program.

The free 10-week online program provides SMEs access to researcher connections, a self-paced learning platform, networking opportunities, guest speakers and expert feedback. Participants can address business challenges, explore collaborations, and create R&D plans within this supportive environment.

Visit the CSIRO website to find out more. 

Read more

Taking the plunge into Industry 4.0 Australian Government

Advanced digital technologies: Industry 4.0 technologies are transforming global supply chains National Energy Resources Australia

Advanced manufacturing case studies NSW Government

Industry 4.0 Advanced Manufacturing Forum (I4AMF) Australian Industry Group

The Fourth Industrial Revolution: Australian businesses in transition (PDF 30MB) Australian Industry Group

Digitalisation and Energy – Technology Report 2017 International Energy Agency

What is Additive Manufacturing? US Department of Energy

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