Industry 4.0 poised to disrupt business rules

The evolution of manufacturing in line with Industry 4.0 trends is poised to disrupt business rules and dynamics across existing supplier landscapes, according to a new study by Frost & Sullivan.

The report suggests Industry 4.0 will bring about a fundamental change in the way suppliers offer solutions and services. The emphasis on a heterogeneous value proposition is gaining traction, leading to fresh synergies and partnerships among vendors in industrial automation, information and communication technology, measurement and instrumentation, and banking and financial services.

Frost & Sullivan finds that the new Industry 4.0 supplier ecosystem is set to reach $420 billion in terms of value by 2020.

“The increasing influence of information and communication technology on the shop floor will give rise to novel business scenarios of collaboration, co-opetition and competition in the industrial landscape,” said Karthik Sundaram, Frost & Sullivan industrial automation and process control program manager. “Connectivity and mobility, supported by Ethernet, cloud computing, virtual reality and big data analytic technologies, will form the cornerstone of next-generation manufacturing.”

While the matrix of cross-industry influence shapes future manufacturing and production, the report predicts technology standardization will be critical for the creation of alliances and partnerships among disparate vendors. An uncertain economic environment along with weak consumer demand will be a hurdle for end users seeking to expedite modernization targets.

Further, the digital factory idea will remain incomplete without a coherent return on investment framework. Establishing profit models and go-to-market strategies for different tiers of end users founded on a service approach will help suppliers emerge as an indispensable partner for manufacturers.

“Industrial suppliers, although in a position of privilege due to their expertise, will be faced with a two-fold task,” Sundaram said. “Enhancing existing products through collaborations and diversifying value to customers by delivering end-to-end solutions that go beyond traditional boundaries.”