Smart factories and Industry 4.0: the next industrial frontier

Smart factories make use of the latest technology to optimize production. Through technologies such as the Internet of Things, AI, and other forms of digital automation. A factory can produce connected devices to improve efficiency, quality and sustainability.

Read on to learn more about smart factories and their applications.

Have you heard about smart factories and Industry 4.0?

We’ve all heard about the industrial revolution. Smokestacks, mechanisation and steam power… we all have a picture in our heads of a 19th century in a state of constant change.

However, that is not the end of the story. With the advent of mass production, electricity, computers and automation, industry as a whole has undergone several revolutions so far. The latter of which is called Industry 4.0, bringing us marvels like the smart factory.

In recent years, we have re-entered a new realm of industrialization. Dubbed “Industry 4.0”, this impact on the collective system involves the “Internet of Things“, cyber-physical systems and cognitive or cloud computing. In simple terms, Industry 4.0 refers to the way our devices communicate with each other and are able to learn over time, thereby increasing efficiency and decentralisation. In practice, these developments are most clearly manifested in what is known as a smart factory.

What is a smart factory?

Smart factories are factories that emphasise optimisation and adaptation of a complex nature. Through the interconnectedness enabled by the Internet of Things and other cyber-physical systems, and with efficiency in mind, smart factories can integrate with the rest of the supply chain, thus enabling real-time process alteration and improvement.

In practice, the greatest asset of a smart factory is its integration with artificial intelligence (AI). Just because something is automated does not mean it has the ability to make complex decisions, especially those that can radically alter a business and its processes.



With AI, not only are such decision-making powers enabled, but you will experience constant self-correction and improvement. It may sound a bit like the Terminator’s Skynet, but in reality, smart factories are not to be feared. On the contrary, its features, benefits and overall impact should persuade everyone to implement it.

What are the characteristics of a smart factory?

The implementation of smart factory processes has revolutionised the manufacturing industry. In fact, many traditional manufacturers and industry leaders have seen Industry 4.0, smart factories, and their inherent features as the solution to several problems endemic to their line of work. For example decentralisation, optimisation and transparency all play key roles.


Decentralisation, in any context, relies heavily on reliability at all levels, in order to trust that efficiency and overall decision-making are maintained without managerial oversight. The same is true of smart factories, as they require little manual interference and are able to optimise and adjust their processes through automation alone.


In the case of smart factories, transparency refers to the availability of relevant data along the entire supply chain. With information easily accessible to all, both automated processes and human management will be able to take note of trends, make more accurate decisions or detect errors before they arise.


Smart factories, with the right optimisation, leverage their decentralised and transparent automation to become more flexible and dynamic. In this way, the smart factory will not only be able to adapt easily, but also take action against anomalies before they become a threat to the overall infrastructure.

smart factory

What are the benefits of a smart factory?

By their very nature, smart factories result in an optimised, decentralised and transparent production process for both the factory itself and the overall supply chain. However, many companies focus on the tangible benefits, beyond the broader features. To that end, the benefits of a smart factory encompass efficiency, quality and sustainability.


Self-adaptation and its effect on efficiency is the biggest benefit of the smart factory. An efficient smart factory, when fully operational, will have continuous access to a constantly changing stream of data. In this way, a smart factory will always analyse and self-correct to make the production process and its output as efficient as possible.


Thanks to the smart factory’s ability to detect and solve production problems before they can become disruptions, your production is never affected. Therefore, the quality of the final product of any smart factory will be superior to that of any of the products manufactured by non-automated means, which sometimes generate defective products.

Sustainable Production

Within traditional factories and manufacturing spaces, disruptions have been known to occur on occasion, whether due to labour, environmental or accidental factors. The adaptability and self-correcting processes that accompany smart factories eliminate the possibility of human error. Therefore, automation can lead to greater safety and ensure the sustainability of production.

What are the impacts of smart factories?

Smart factories do not simply exist in a vacuum. While their features and benefits have altered production processes in factories around the world, their impact is much broader. What effect does this new industrial revolution have on the workforce, supply chain and safety? The answer may surprise you!

Workforce Disruption

An industry’s processes cannot undergo such a revolution without affecting the worker in some way. As in previous industrial revolutions, the role of the human workforce has changed. Generally speaking, workers will shift from physical labour to technological support, requiring a more technical skill set.

Across the entire supply chain, from manufacturing to quality control and warehouse management, the rise of smart factories has forced adaptation at all levels. As the automation and self-correcting processes of a smart factory operate around the clock, the rest of the supply chain needs to maintain the same level of flexibility.

Security issues

In our digital age, information has become more accessible than ever before, but at the cost of security. Data protection has quickly become a fully-fledged industry as many entities seek to protect information. Smart factories are not inherently exempt from this problem, but they have inspired many companies to prioritise finding a solution.


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