Adopting Industry 4.0 – The Challenges

Through the blog series on Industry 4.0, we have taken a close look at what Industry 4.0 is, how it promises to transform manufacturing, and how it shall impact warehousing. Before we conclude this fascinating series, we shall look at the major challenges manufacturers face in their pursuit of Industry 4.0. We have made sure that we provide a few tips to work around the challenges. Hope you                                                                                    find the following piece useful.

According to a white paper from the World Economic Forum, 70% of the manufacturers are involved in one or the other Industry 4.0 related activity. While this is a good sign, not all investor companies are at the same level when it comes to their adoption lifecycle. The extent of their investment differs significantly. Factors such as awareness, capabilities, budgets, etc. play a significant role in manufacturers’ decision of adopting Industry 4.0 initiatives. Evidently, that makes it a marathon rather than a sprint.

No journey is without hurdles, and adopting Industry 4.0 is no exception. Manufacturers face serious challenges which, in some cases, forces them to fall behind their peers in the adoption lifecycle. Let us look at some of the major challenges:

Challenge #1: Using legacy and outdated systems

Manufacturers, predominantly, lean on many legacy data-systems, from Excel sheets to ERP systems, MES systems and others. One of their major concerns while adopting Industry 4.0 technology is whether the new data systems will integrate seamlessly with the existing databases. Seamless integration saves heavy investment in new tools and precious time in shifting all the data from old to new systems. Thus, manufacturers must look for solutions that integrate with existing databases. Also, solution providers must take note of this challenge and design solutions accordingly.

Challenge #2: Estimating the ROI of Industry 4.0 solutions

Manufacturers, understandably, wish to have a fair idea of the possible returns on their investments beforehand. They want to understand precisely what business value shall be generated through the adoption of Industry 4.0 solutions. However, it is quite tricky to estimate the ROI of Industry 4.0 solutions.

To truly estimate, one must translate the impact of technologies into increases in efficiency, productivity, reduction in quality-related issues, worker productivity enhancement, etc. Thus, manufacturers must opt for solution providers that provide an exact estimation of the ‘real’ impact that their solutions promise. They must ensure not only the Proof of Concept (POC) but also Proof of Value (PoV).

Challenge #3: Where to begin?

While Industry 4.0 solutions change entirely the way processes work, they can be quite overwhelming to understand, let alone invest in. For manufacturers that are just starting their Industry 4.0 journey, it can be quite confusing to pin-point which areas they should first work on, which problems to solve etc. Should it be material management and saving? Perhaps tool and inventory management? Or quality control and process optimization?

Here, manufacturers must begin by identifying the most critical areas to their businesses and that are lacking behind their expectations of performance. They should focus on solving just one major problem first and then rolling out the solutions to other areas. Start small, succeed fast and then build!

Challenge #4: Putting data to the required use

Collecting data from a wide variety of sources is only the first step. Next, data must be put to use to monitor the most critical KPIs t to your business. This is where most manufacturers are stuck. IIoT allows them to acquire massive data, but they find it challenging to benefit from the data.

Companies must opt for solutions that enable them to leverage the data for achieving their business goals. Backend analysis, reporting and visualization are critical in that pursuit.

Challenge #5: Finding the right fit

There are as many Industry 4.0 solutions in the market as you can think of. But one must understand that not all of them are suited to solving your business problems. Each manufacturer’s needs may be different, and the challenges they face must be unique in its way. Thus, finding the solution that perfectly aligns with your business goals is critical.

Manufacturers must spend a good deal of time analyzing as many solutions as possible before opting for one. They must start with understanding their business needs and then look for solutions. Saving huge costs, reinvestments and losses later.


The above list does not cover all the possible challenges. However, it tries to warn manufacturers of all the major challenges they may face on the way to Industry 4.0 adoption. The ever-changing nature and fast pace of Industry 4.0 technologies also mean that this list of  challenges will continue to evolve. Therefore, companies must prepare well before embarking on the journey, and understand that each challenge has a solution.

In the next blog we shall outline how, at Yantra, we incorporate several Industry 4.0 technologies to provide the best and modern benefits to our customers. Stay tuned to our Knowledge Corner!

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