How smart people create Smart Factories

From the steam engine all the way through electricity and computers to robots and data: The fourth industrial revolution has arrived. Commonly called Industry 4.0, this concept has entailed cyber-physical systems, Cloud Computing, Big Data analytics, IoT and Data Science taking manufacturing to the next level.

With Industry 4.0 come the so-called “Smart Factories”, where machines transmit data to each other independently, synchronise with each other, adjust production settings automatically, react to events, plan maintenance and obey safety rules; all this with little or no help from humans. 

Business Analyst and Agile Coach advising customers in manufacturing and other industries.

Franziska Grohmann 

Lead Shoring & Delivery, 

Project Manager Industry 4.0.

Carlo Cronauer 

What does intelligent production entail?

Traditionally, this requires a great deal of management oversight and detailed planning either manually or by different systems (think: ERP systems, SCM systems, systems to monitor chemicals or machine PLCs, etc.). Smart Factories, on the other hand, are managed by a system called MES (Manufacturing Execution System).

An MES is defined by the Manufacturing Enterprise Systems Association (MESA) as “a dynamic information system that drives effective execution of manufacturing operations using current and accurate data.” This means that the system guides, triggers and reports on plant activities as various events occur, and can also provide critical information about production activities to stakeholders across the organisation and supply chain.

These systems manage and execute most operations, from placing an order to shipping the finished product to the customer. The MES system does all this by integrating multiple data sources such as the data from sensors attached to the machines, PLC data, ERP data, etc.

In other words, a factory becomes “smart” when it can organise itself almost automatically and with minimal human intervention.

A Smart Factory has the following aspects: 

  • Interoperability 

The computer software, sensors and machines installed in the factory communicate with each other and the workers. 

  • Information transparency 

The systems create a virtual image of the physical world through data sensors to contextualise information. All data is stored. 

  • Technical assistance 

The systems support humans in making decisions and solving problems as well as assisting or replacing them in difficult and unsafe tasks. 

  • Independent decision making 

The cyber-physical systems are able to use the data collected from the factory floor and make simple and complex decisions on their own, becoming as autonomous as possible.

"It is literally about factories being smart."

According to Capgemini’s Digital Transformation Institute, Smart Factories may contribute at least $500 billion annually to the global economy in the next couple of years.

What is the 4th  industrial revolution?

Human muscle was replaced with iron machines, initially powered by water and then by steam engines.

Railroads, the telegraph and 

electricity open the way to 

modern-style mass production.

Robots and sensors connect the Internet of Things to flexibly serve connected customers.

Analog and mechanical devices are replaced by digital controls.


First Industrial Revolution 


Second Industrial Revolution


Third Industrial Revolution


Fourth Industrial Revolution

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