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2018 | Book

Industry 4.0: Managing The Digital Transformation


About this book

This book provides a comprehensive guide to Industry 4.0 applications, not only introducing implementation aspects but also proposing a conceptual framework with respect to the design principles. In addition, it discusses the effects of Industry 4.0, which are reflected in new business models and workforce transformation. The book then examines the key technological advances that form the pillars of Industry 4.0 and explores their potential technical and economic benefits using examples of real-world applications. The changing dynamics of global production, such as more complex and automated processes, high-level competitiveness and emerging technologies, have paved the way for a new generation of goods, products and services. Moreover, manufacturers are increasingly realizing the value of the data that their processes and products generate. Such trends are transforming manufacturing industry to the next generation, namely Industry 4.0, which is based on the integration of information and communication technologies and industrial technology.The book provides a conceptual framework and roadmap for decision-makers for this transformation

Table of Contents


Understanding Industry 4.0

Chapter 1. A Conceptual Framework for Industry 4.0
Industrial Revolution emerged many improvements in manufacturing and service systems. Because of remarkable and rapid changes appeared in manufacturing and information technology, synergy aroused from the integration of the advancements in information technology, services and manufacturing were realized. These advancements conduced to the increasing productivity both in service systems and manufacturing environment. In recent years, manufacturing companies and service systems have been faced substantial challenges due to the necessity in the coordination and connection of disruptive concepts such as communication and networking (Industrial Internet), embedded systems (Cyber Physical Systems), adaptive robotics, cyber security, data analytics and artificial intelligence, and additive manufacturing. These advancements caused the extension of the developments in manufacturing and information technology, and these coordinated and communicative technologies are constituted to the term, Industry 4.0 which was first announced from German government as one of the key initiatives and highlights a new industrial revolution. As a result, Industry 4.0 indicates more productive systems; companies have been searching the right adaptation of this term. On the other hand, the achievement criteria and performance measurements of the transformation to Industry 4.0 are still uncertain. Additionally, a structured and systematic implementation roadmap is still not clear. Thus, in this study, the fundamental relevance between design principles and technologies is given and conceptual framework for Industry 4.0 is proposed concerning fundamentals of smart products and smart processes development.
Ceren Salkin, Mahir Oner, Alp Ustundag, Emre Cevikcan
Chapter 2. Smart and Connected Product Business Models
A business model describes the value offered by the company. Business models have a significant impact on the success of the business. Smart and connected products, which connect the physical objects by using sensors and communication technology, change the nature of traditional businesses and business models. The value propositions, revenue streams, and technologies offered with these smart and connected products are different from the traditional business models. In this chapter, we define the key features of smart and connected product business models and reveal the successful real life cases with this framework.
Sezi Cevik Onar, Alp Ustundag
Chapter 3. Lean Production Systems for Industry 4.0
Succeeding a cultural and people oriented transformation, Lean Producers adopts the philosophy of doing more with less by eliminating non-value-added activities from production processes to maintain effectiveness, flexibility, and profitability. With the context of Industry 4.0, new solutions are available for combining automation technology with Lean Production. Moreover, when effective resource (finance, labour, material, machine/equipment) usage is concerned, it is obvious that Industry 4.0 should be applied on lean processes. In this context, this chapter attempts to emphasize the interaction between Lean Production and Industry 4.0 and proposes a methodology which provides guidance for Industry 4.0 under lean production environment. Moreover, Industry 4.0 technologies and automation oriented Lean Production applications are also included.
Sule Satoglu, Alp Ustundag, Emre Cevikcan, Mehmet Bulent Durmusoglu
Chapter 4. Maturity and Readiness Model for Industry 4.0 Strategy
Companies that transform their businesses and operations regarding to Industry 4.0 principles face complex processes and high budgets due to dependent technologies that effect process inputs and outputs. In addition, since Industry 4.0 transformation creates a change in a business manner and value proposition, it becomes highly important concept that requires support of top management for the projects and investments. Therefore, it requires a broad perspective on the company’s strategy, organization, operations and products. So, the maturity model is suitable for companies planning to transform their businesses and operations for Industry 4.0. It is a very important technique for Industry 4.0 in terms of companies seeking for assessing their processes, products and organizations and understanding their maturity level. In this chapter, existing maturity models for Industry 4.0 transformation are reviewed and a new Industry 4.0 maturity model is proposed.
Kartal Yagiz Akdil, Alp Ustundag, Emre Cevikcan
Chapter 5. Technology Roadmap for Industry 4.0
From both strategic and technologic perspectives, the Industry 4.0 roadmap visualizes every further step on the route towards an entirely digital enterprise. In order to achieve success in the digital transformation process, it is necessary to prepare the technology roadmap in the most accurate way. The intent of this chapter is to present a technology roadmap for Industry 4.0 transformation to facilitate the planning and implementation process.
Peiman Alipour Sarvari, Alp Ustundag, Emre Cevikcan, Ihsan Kaya, Selcuk Cebi
Chapter 6. Project Portfolio Selection for the Digital Transformation Era
By bringing various technological advances together, Industry 4.0 promises production systems to boost in productivity. The transformation of the existing production systems into an Industry 4.0 factory is a strategic and long-term undertaking which needs a high capital investment, training of personnel and change of the environment and the culture in almost all of the functions of the value chain. Thus, it is required to be planned well by the companies. To be successful in the Industry 4.0 era, companies will not only have to simultaneously execute interdependent projects, but also require to perform project portfolio selection task in multi-dimensional environments in the presence of high uncertainty. Since determining optimal project portfolio for digital transformation among various project alternatives demands the consideration of multiple constraints and interdependencies, an integer programming model is proposed to address this problem in this chapter. To demonstrate its effectiveness and practicality, the proposed optimization model is applied to the Industry 4.0 project alternatives of an automotive manufacturer.
Erkan Isikli, Seda Yanik, Emre Cevikcan, Alp Ustundag
Chapter 7. Talent Development for Industry 4.0
In today’s global environment, sustainability and competitive advantage of companies depend mostly on their capability of adaptation to changing business requirements. The Fourth Industrial Revolution, driving from the advancements in new digital technologies known collectively as Industry 4.0, has been profoundly changing dynamics of most industries. Automation of business processes together with emergence of novel business models impose new digital skill requirements for workforce. Creating future workforce involves not only attracting and developing new talent needed, but also re-skilling current employees through training programs as well as re-designing work processes for reducing the skill mismatch between jobs and employees. This chapter examines how Industry 4.0 will alter the landscape for talent development.
Gaye Karacay
Chapter 8. The Changing Role of Engineering Education in Industry 4.0 Era
The new industry 4.0 era necessities new cross-functional roles with different knowledge and skills that combine IT and production knowledge. The universities and their engineering departments have a vital role in fulfilling this need. There are a number of departments offering these new engineering education requirements, but the characteristics of these departments and how they converge to and diverge from each other are yet to be revealed through objective evaluation. Such evaluation should be based on a precise classification of knowledge and skills areas offered in these departments. Therefore, it is important to understand the characteristics of knowledge and skills provided in these departments to determine the emerging patterns in the delivery of new education requirements of Industry 4.0. The main objectives of this chapter is to define the new education requirements incorporated into Industry 4.0, and reveal the emerging patterns and similarities in engineering education to cover this need. In order to address these issues we study a sample of 124 engineering departments.
Sezi Cevik Onar, Alp Ustundag, Çigdem Kadaifci, Basar Oztaysi

Technologies and Applications

Chapter 9. Data Analytics in Manufacturing
Development of technology has emerged a new concept, Industry 4.0. It has come with two technological improvements, Cyber-Physical System (CPS) and Internet of Things (IoT) that drive manufacturing companies to Data Analytics by generating the huge amount data. In terms of Industry 4.0, data analytics focus on “what will happen” rather than “what has happened”. These problems are entitled as predictive analytics and aims at building models for forecasting future possibilities or unknown events. The aim of this paper is to give insight about these techniques, provide applications from the literature and show a real world case study from a manufacturing company.
M. Sami Sivri, Basar Oztaysi
Chapter 10. Internet of Things and New Value Proposition
Internet of Things (IoTs) are the new wave in technological innovation that fundamentally shift the dynamics of businesses all around the world. Contrary to popular belief, IoTs are not just about sensors or machine intelligence embedded in variety of things that are part of our business or personal lives, but these are the tools that provide the primary base for doing business in a novel and integrated way by “creating value” as social, personal, and economic return. Value creation triggered by IoT via provision of variety of data is the core of these novel business systems. Gradually every industry will be disrupted by the emergence of new data which become easily available by means of IoTs and their various applications. These novel technologies will bring about not only new hardwares, new applications, and new services; but also will fundamentally change the processes or the ways of doing work. This chapter looks at how IoTs enable creation of new value in business life by examining real life IoT applications within different sectors.
Gaye Karacay, Burak Aydın
Chapter 11. Advances in Robotics in the Era of Industry 4.0
The industrial robots in factories have been recently designed and utilized to handle dangerous tasks for humans, to achieve faster and more accurate production processes, and to reduce the cost of the products. Since the competitiveness in today’s business environment increases, manufacturers require more intelligent systems making smarter decisions. In the light of Industry 4.0 revolution, the advances in information technology like artificial intelligence, cloud and Big Data change the use and design of robots in the industry. The potential industrial robotic applications and the next generation of robotics planned to be utilized in the Industry 4.0 factories are discussed.
Barış Bayram, Gökhan İnce
Chapter 12. The Role of Augmented Reality in the Age of Industry 4.0
Augmented Reality (AR) has increased its popularity in both industry and academia since its introduction two decades ago. The AR has carried the way of accessing and manipulating the information to another level by enhancing perception of the real world with virtual information. In this chapter, the basic technical components of AR are introduced as well as its practical uses in the industry especially in manufacturing, maintenance, assembly, training and collaborative operations. After describing the underlying hardware and software systems establishing AR, recent applications of AR in the industry are reviewed.
Mustafa Esengün, Gökhan İnce
Chapter 13. Additive Manufacturing Technologies and Applications
Additive Manufacturing (AM) Technologies is has become widely popular manufacturing technique in the last 30 years. Additive manufacturing uses 3D Computer Aided Design (CAD) model to manufacture parts layer by layer through adding materials. Additive Manufacturing allows to manufacture complex geometries that cannot be manufactured using conventional manufacturing techniques. Additive manufacturing permits customized designs and prototypes to be produced easily. Over the past three decades thorough research has been done to commercialize AM techniques in varied areas. As a result of these research, AM techniques are being used in automotive, aerospace, biomedical, medicine, energy and in many other areas. Due to its advantage over the traditional manufacturing techniques, additive manufacturing is seen as one of the enablers that started fourth industrial revolution. In this chapter, we will review additive manufacturing processes by introducing its history, presenting different technologies of AM, giving examples of AM usage in different application areas and its impact on our society.
Omer Faruk Beyca, Gulsah Hancerliogullari, Ibrahim Yazici
Chapter 14. Advances in Virtual Factory Research and Applications
Simulation is a powerful tool to observe the performance of the manufacturing systems in variable demand and dynamic factory conditions in virtual environments. Recently, modeling and analysis of the factory objects in a 3-dimensional Simulation software emerged that is called a Virtual Factory (VF). The VF provides an integrated simulation model by representing all major aspects of a factory. It helps to consider the factory as a whole and provides decision support (Jain et al. in Winter simulation conference (WSC). IEEE, Piscataway, 2015). In other words, a VF Framework is a virtual advanced software environment that aims assisting the design and management of all physical factory entities during the all phases of the factory life-cycle (Azevedo et al. in Management and Control of Production and Logistics:320–325, 2010). In this chapter, the research projects and academic papers that focus on the Virtual Factories are reviewed. Besides, the commercial VF software are investigated, their distinguishing aspects are assessed, and their limitations are discussed. Finally, future work suggestions are presented.
Alperen Bal, Sule I. Satoglu
Chapter 15. Digital Traceability Through Production Value Chain
The value of Digital Traceability technologies are critical for the production systems, due to the high levels of complicated manufacturing processes and logistics operations. In this chapter, digital traceability technologies are discussed to analyze manufacturing processes, such as: tracking work-in-progress, tracking inventories, counting stock, receiving, picking, and shipping of semi finished products. To do this, an architectural framework of the technologies in production industry was designed. A roadmap for digital traceability design, configuration and deployment is presented in order to design an integrated approach as pointed out in the literature and in former projects. It can be clearly pointed out that, by using digital traceability technologies in production value chain, redundant inventory and production costs, redundant labour costs caused by inefficient production activities, inaccuracies of records, incorrect order deliveries and penalty costs incurred by customers could be significantly reduced, which provides invaluable advantages in the real life competition of the productions systems.
Aysenur Budak, Alp Ustundag, Mehmet Serdar Kilinc, Emre Cevikcan
Chapter 16. Overview of Cyber Security in the Industry 4.0 Era
The global development industry is in the midst of a transformation to meet today’s more complex and highly competitive industry demands. With the rapid advances in technology, a new phenomenon has emerged in the current era, Industry 4.0. The integration of information technology and operational technology brings newer challenges, especially cyber security. In this chapter, one of the most popular topics of recent times, cyber security issue, has been investigated. The occurrence of the Internet of Things (IoT), has also dramatically altered the appearance of cyber threat. Security threats and vulnerabilities of IoT, industrial challenges, main reasons of cyber-attacks, cyber security requirement and some cyber security measures/methods are discussed with a global perspective involving both the public and private sector in the IoT context.
Beyzanur Cayir Ervural, Bilal Ervural
Industry 4.0: Managing The Digital Transformation
Alp Ustundag
Emre Cevikcan
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