**1. Introduction**

In recent decades, producers and suppliers of goods and services have improved the quality of their organizations through the use of innovative technologies [1]. This is because the industry is undergoing transformation and evolution toward complete digitization and the intelligence of production processes to ensure high efficiency [2]. To achieve these goals, it is necessary to implement new technologies for the automation of industrial processes. These concepts are the pillars of the fourth industrial revolution called "Industry 4.0" [3]. The fourth industrial revolution was developed in Germany in 2013 but is spreading rapidly in Europe

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. © 2018 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

and the world as a whole [4]. This new work model focuses on the integrated man-machine approach through "sustainable" production.

The Industry 4.0 is based on the concept of smart factory, where the machines are integrated with men through cyber-physical systems (CPS). In other words, Industry 4.0 is a new level of organization that manages and controls the whole value chain of personalized products to satisfy customer needs [5]. Digitalization is the most important element in Industry 4.0 because it allows to connect man and technology [6].

Industry 4.0 covers three fundamental aspects:


The effect is a radical transformation of traditional industries that are changing their "approach" to the work. It means the use of new production technology, new machinery, new materials, and new inputs. In this context, knowledge has become the crucial input. Furthermore, a complete integration between the cyber and physical dimensions is occurred.

of technologies that will enable companies to achieve higher productivity, flexibility, as well as enhanced product and service qualities [11]. Roland Berger [12] also mentioned that there are slow and steady changes in some areas and described some evolutionary effects of this development. However, the majority of experts, including those in leading companies such as McKinsey & Company, Boston Consulting Group, Capgemini Consulting, Accenture, and General Electric have clearly pointed out the fundamental change of this development considering this transformation toward digital manufacturing as a new and considerable industrial revolution with tremendous effects on countries, economics, busi-

Fourth Industrial Revolution: Current Practices, Challenges, and Opportunities

http://dx.doi.org/10.5772/intechopen.72304

3

The current industrial revolution is characterized by the collaboration of intelligent machines, storage systems, and production systems into intelligent networks, merging the real and virtual worlds in cyber-physical systems (CPS) [13]. CPS are the integration of IT system with mechanical and electronic components connected to online networks that allow the communication between machines in a similar way to social networks [14]. These innovative technologies enable factories to become "smart," resulting in productions of customized products on an industrial scale while providing many opportunities for improvements in operational flexibility and efficiency. Japan begins to talk about the fifth industrial revolution coming,

The rest of the chapter is organized as follows: Section 2 presents state of the art on the "Industry 4.0"; Section 3 analyzes the main principles of digital technologies and industrial transformations. In Section 4 the main opportunities related to Industry 4.0 are analyzed. Then, Section 5 presents qualification and skills operator required for Industry 4.0. Finally, in

which will be based on cooperation between man and machine.

Section 6 the main conclusions of the chapter are presented.

nesses, and human labor.

**Figure 1.** Industrial revolutions.

Western civilization has passed through three stages of the industrial revolution, and the fourth revolution is in progress. An industrial revolution can be defined as a disruptive leap in the industrial process [7], a development that produces fundamental changes in the society and the economy [8].

**Figure 1** describes the main phases that characterized industrial revolutions. The first industrial revolution was developed in the eighteenth century due to mechanical production obtained by water and steam, with the development of machine tools and an improvement of their efficiency. The second industrial revolution developed with the arrival of electricity and mass production, theorized by Smith and Taylor and implemented by Henry Ford in his Detroit factory for the production of the Model T. The third revolution was characterized by machine automation through the use of electronics and IT applied in the production processes [9].

The fourth industrial revolution integrates IT systems with physical systems to get a cyberphysical system that brings the real world in a virtual reality. There are also several opposing opinions. For example, *The Economist* [10] stated that the fourth industrial revolution is only an evolution of the third industrial revolution. Harald Krüger, Chief Production Officer at the BMW Group, instead, considers this development not as a fundamental revolution taking a huge digital leap forward. He explained that it is a constant development Fourth Industrial Revolution: Current Practices, Challenges, and Opportunities http://dx.doi.org/10.5772/intechopen.72304 3

**Figure 1.** Industrial revolutions.

and the world as a whole [4]. This new work model focuses on the integrated man-machine

The Industry 4.0 is based on the concept of smart factory, where the machines are integrated with men through cyber-physical systems (CPS). In other words, Industry 4.0 is a new level of organization that manages and controls the whole value chain of personalized products to satisfy customer needs [5]. Digitalization is the most important element in Industry 4.0

**1.** *Digitization and increased integration of vertical and horizontal value chains*: development of custom products, customer's digital orders, automatic data transfer, and integrated cus-

**2.** *Digitization of product and service offerings*: complete descriptions of the product and its re-

**3.** *Introduction of innovative digital business models*: the high level of interaction between systems and technology opportunities develops new and integrated digital solutions. The basis of industrial Internet is the integrated and real-time availability and control of systems

The effect is a radical transformation of traditional industries that are changing their "approach" to the work. It means the use of new production technology, new machinery, new materials, and new inputs. In this context, knowledge has become the crucial input. Furthermore, a complete integration between the cyber and physical dimensions is occurred. Western civilization has passed through three stages of the industrial revolution, and the fourth revolution is in progress. An industrial revolution can be defined as a disruptive leap in the industrial process [7], a development that produces fundamental changes in the society

**Figure 1** describes the main phases that characterized industrial revolutions. The first industrial revolution was developed in the eighteenth century due to mechanical production obtained by water and steam, with the development of machine tools and an improvement of their efficiency. The second industrial revolution developed with the arrival of electricity and mass production, theorized by Smith and Taylor and implemented by Henry Ford in his Detroit factory for the production of the Model T. The third revolution was characterized by machine automation through the use of electronics and IT applied in the production

The fourth industrial revolution integrates IT systems with physical systems to get a cyberphysical system that brings the real world in a virtual reality. There are also several opposing opinions. For example, *The Economist* [10] stated that the fourth industrial revolution is only an evolution of the third industrial revolution. Harald Krüger, Chief Production Officer at the BMW Group, instead, considers this development not as a fundamental revolution taking a huge digital leap forward. He explained that it is a constant development

approach through "sustainable" production.

2 Digital Transformation in Smart Manufacturing

because it allows to connect man and technology [6].

Industry 4.0 covers three fundamental aspects:

lated services through intelligent networks.

tomer service systems.

across the enterprise.

and the economy [8].

processes [9].

of technologies that will enable companies to achieve higher productivity, flexibility, as well as enhanced product and service qualities [11]. Roland Berger [12] also mentioned that there are slow and steady changes in some areas and described some evolutionary effects of this development. However, the majority of experts, including those in leading companies such as McKinsey & Company, Boston Consulting Group, Capgemini Consulting, Accenture, and General Electric have clearly pointed out the fundamental change of this development considering this transformation toward digital manufacturing as a new and considerable industrial revolution with tremendous effects on countries, economics, businesses, and human labor.

The current industrial revolution is characterized by the collaboration of intelligent machines, storage systems, and production systems into intelligent networks, merging the real and virtual worlds in cyber-physical systems (CPS) [13]. CPS are the integration of IT system with mechanical and electronic components connected to online networks that allow the communication between machines in a similar way to social networks [14]. These innovative technologies enable factories to become "smart," resulting in productions of customized products on an industrial scale while providing many opportunities for improvements in operational flexibility and efficiency. Japan begins to talk about the fifth industrial revolution coming, which will be based on cooperation between man and machine.

The rest of the chapter is organized as follows: Section 2 presents state of the art on the "Industry 4.0"; Section 3 analyzes the main principles of digital technologies and industrial transformations. In Section 4 the main opportunities related to Industry 4.0 are analyzed. Then, Section 5 presents qualification and skills operator required for Industry 4.0. Finally, in Section 6 the main conclusions of the chapter are presented.
