Computers, Materials & Continua Tech Science Press

DOI:10.32604/cmc.2020.012587
Article

Industry 4.0: Architecture and Equipment Revolution

Ahmed Bashar Fakhri1, Saleem Latteef Mohammed1, Imran Khan2, Ali Safaa Sadiq3,4,
Basem Alkazemi5, Prashant Pillai4 and Bong Jun Choi6,*

1
Department of Medical Instrumentation Techniques Engineering, Electrical Engineering Technical College, Middle Technical
University, Baghdad, Iraq
2
Department of Electrical Engineering, University of Engineering and Technology Peshawar, Peshawar, Pakistan
3
School of Mathematics and Computer Science, University of Wolverhempton, Wulfruna Street, Wolverhempton, UK
4
Center of Artificial Intelligence Research and Optimization, Torrens University, Brisbane, Australia
5
Department of Computer Science, College of Computer & Information Systems, Umm Al-Qura University, Mecca, Saudi Arabia
6
School of Computer Science and Engineering, Soongsil University, Seoul, South Korea

Corresponding Author: Bong Jun Choi. Email: [email protected]
Received: 05 July 2020; Accepted: 26 July 2020

Abstract: The development of science and technology has led to the era of Indus-
try 4.0. The core concept is the combination of “material and informationization”.
In the supply chain and manufacturing process, the “material” of the physical
entity world is realized by data, identity, intelligence, and information. Industry
4.0 is a disruptive transformation and upgrade of intelligent industrialization
based on the Internet-of-Things and Big Data in traditional industrialization.
The goal is “maximizing production efficiency, minimizing production costs,
and maximizing the individual needs of human beings for products and services.”
Achieving this goal will surely bring about a major leap in the history of the
industry, which will lead to the “Fourth Industrial Revolution.” This paper pre-
sents a detailed discussion of industrial big data, strategic roles, architectures,
characteristics, and four types of innovative business models that can generate
profits for enterprises. The key revolutionary aspect of Industry 4.0 is explained,
which is the equipment revolution. Six important attributes of equipment are
explained under the Industry 4.0 perspective.

Keywords: Industry 4.0; big data; smart manufacturing; business model;

equipment revolution

1 Introduction
We are now experiencing events that may indicate the arrival of a fourth industrial revolution, in which
the objects in a factory begin to transform into intelligent objects capable of interacting with each other and
communicating data about the state of production or about their own state. This fourth revolution has
generated the concept of Industry 4.0, which began in Germany a few years ago and has increasingly
spread throughout the world, especially in Europe [1–3]. Industry 4.0 will help improve efficiency in
factories, achieve higher productivity, and optimize time, costs, materials, or energy. We are faced with an

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increasingly globalized world, a more changing market, and more stringent requirements from customers.
Thus, another great advantage is that this system allows us to achieve the desired size of one lot; that is,
to be able to manufacture different individual products for each client in the same series of production,
depending on the needs, tastes, or general requirements of the client.
In Germany, Industry 4.0 refers to all products and services that need technology and communication by
2020 and has a market potential of 10.9 million Euros, with an annual added value of 1.7% [4–7]. The term
Industry 4.0 was created by the German government [8]. This concept is part of the so-called Fourth
Industrial Revolution, in which the physical real world and the virtual world unite in a system called a
Cyber-Physical System (CPS), which is possible through the Internet of Things (IoT). IoT is defined as a
new complementary concept of the evolution of communications and computing applied to objects,
which allows better interaction between them [9–10]. It refers to a network of things that are
interconnected daily through the Internet. CPS is defined as the integration of computing, networks, and
physical processes, with embedded computing and monitoring in networks for the control of physical
processes, as well as feedback loops where the physical processes affect the computational ones, and vice
versa [11]. CPS integrates embedded systems into devices that allow interaction with the dynamics of
physical processes, providing abstractions, models, designs, and analysis techniques for their integration.
Dregger et al. posed the characteristics of future industrial production in terms of the following aspects:
greater individualization of the product (with a highly flexible mass production); greater and better
integration of customers and suppliers in processes of business with high-quality products and services
resulting from hybrid products; optimization for standardization and reference architectures in the control
of complex systems, the internet infrastructure, and its coverage in terms of security for the industry; the
organization and design of training of new jobs and the development of applications that meet the
conditions of legal studies; the efficiencies of resources; vertical integration under added value to
networks; the digitalization of the supply chain; and vertical integration with systems connected
production [12]. As the core of intelligent manufacturing, industrial big data plays an important role in
the integrated application in the whole process of enterprise R&D, manufacturing, operation management,
sales service, and the whole industry chain. It also supports manufacturing innovation and promotes
transformation and upgrading.
The rest of the paper is organized as follows. Section 2 presents related work. Section 3 provides the
definition and characteristics of industrial big data. Section 4 discusses the industrial big data reference
architecture. Section 5 elaborates on the governance of industrial big data. Section 6 explains the strategic
role of industrial big data. Section 7 explains the big data and business model. Section 8 provides the
proposed research analysis of different enterprises, and Section 9 concludes the paper.

2 Related Work
In 2011, representatives from the business, political, and academic circles jointly proposed an Industry
4.0 initiative to enhance the competitiveness of German manufacturing. The German federal government
incorporated the initiative into the “Germany 2020 High-Tech Strategy” [1–4]. The Industry 4.0 Working
Group was formed, and the Industry 4.0 Roadmap [5–10] was released in 2013. Unlike the previous three
industrial revolutions, Industry 4.0 is not a post-summer summary but a predictive industrial revolution,
so companies involved can shape and influence future development models. Industry 4.0 will have a huge
impact according to forecasts. By 2025, it will bring Germany a contribution of 78 billion euros in GDP
[13]. As a joint initiative between government and business, it is no accident that Industry 4.0 appeared
in Germany. It is based on the advanced level of equipment manufacturing in Germany. The Industry
4.0 Working Group describes Industry 4.0 as follows. In the future, business will be built to cover
mechanical equipment, storage systems, and a network based on an information physical system, such as
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a production device. In the manufacturing sector, information physics systems will include intelligent
machines, warehousing systems, and production facilities that automatically exchange information, trigger
actions, and coordinate control. Thus, the production, design, material consumption, supply chain, and
lifecycle management are qualitatively improved, among others.
Smart factories have been using new production methods, and smart products are uniquely labeled to
trace their history throughout their life cycle while seeing the current status and future processing
methods. The embedded production system will form a horizontal network with a vertical network and
scattered value chain of the factory or enterprise business process. It will also form real-time management
from the procurement of raw materials [14]. To achieve this vision, Industry 4.0 needs to include the
following elements: a Cyber-Physical System (CPS), IoT, Cloud Storage, Big Data, Smart Factories, and
so on. The realization of these elements depends on the application of advanced equipment, so Industry
4.0 will be a new format driven by advanced equipment. Based on this prospect, the basic equipment
under Industry 4.0 needs new changes [15].
The industry is an activity of vital importance in a region since it can maintain both the labor market in
that region and the added value or skills that employees can provide. A weak industry is even translated into
modifications in the social estates of a region since it can affect the middle class and polarize the society more
and more. Europe, among other powers, has plunged in recent years in terms of the percentage of the global
industry share. According to one study [16–17], this has been due to two major industrial fractures that have
occurred in recent years. The first of these came as a result of emerging countries such as BRIC or some
countries in Eastern Europe. Between 1990 and 2011, the growth of added manufacturing value in these
emerging countries was 10 times higher than in other countries with traditional industry.
The second major industrial fracture is occurring within Europe, where some countries have managed to
maintain their industrial added value, while in others, it has declined considerably. But currently, there have
been changes taking place to turn this situation around. For this, it is necessary to adapt to the current volatile
markets. One study argues that the key to competitiveness is currently flexibility and that the current trend
towards shorter terms, fluctuations in the quantities ordered, or increasingly personalized products require a
much more flexible supply chain [18]. For this reason, the term Industry 4.0 was born.

2.1 Background and Definition

To arrive at Industry 4.0, we must first remember the industrial revolutions that have taken place
throughout history. The first of them began in the eighteenth century and developed throughout the
nineteenth century. It introduced mechanical elements that facilitate production tasks through the use of
hydraulic energy, steam, or machine tools. The second industrial revolution took place in the late
nineteenth century when electricity began to be used in production, mass production was introduced, and
a system was started to organize the tasks and assigned times. The third revolution came more recently in
approximately 1970 when electronics and information technologies began to be used with the aim of
automating production tasks [19]. This revolution is also called the digital revolution, and its use has
extended to this day. The fourth and last industrial revolution is currently taking place. Fig. 1 shows the
development of these industrial revolutions along the time axis in addition to key features of each of them.
This fourth industrial revolution is still taking place, and there are sectors that are changing more sharply
and faster than others, which are evolving more constantly and slowly [20]. In all areas, physical objects,
machines, processes, or production systems are being introduced within an information network
connected to the Internet. Linked to this fourth industrial revolution the concept of “Industry 4.0” was
born in 2011. The term was born as a result of the initiative “Industrie 4.0,” an association that emerged
in Germany with the aim of improving the global competitiveness of Germany in the productive
landscape, which was formed by great people from the worlds of business, politics, and education, among
others. This initiative ended up leading to a project of great importance whose objective is to achieve
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leadership in technological innovation, with major objectives to be met from the moment of its creation until
2020 [20]. One of the principles of Industry 4.0 is to collect and share information in real-time [21].
According to the Ministry of Education and Research of Germany, the term Industry 4.0 includes cyber-
physical systems that help improve the flexibility of networks, which translates into machines and plants
that are capable of modifying their behavior before orders or different conditions. These systems are able
to receive information, analyze it, and modify its way of acting depending on the information.

4. Industrial
Revolution
-Based on Cyber-
Physical Systems
Complexity

3. Industrial
Revolution
-Uses electronics and IT
to achieve further
2. Industrial automation of
Revolution manufacturing
-Introduction of
electrically-powered
1. Industrial mass production based
Revolution on the division of labor
-Introduction of water
-Steam-Powered
Mechanical
Manufacturing Facilities
End of 18th Start of 20 th Start of Today Time
Century Century 1970s

Figure 1: Industrial revolutions

2.2 Key Factors

The factors that have influenced the birth of Industry 4.0 basically serve two different aspects [22]. First,
there are factors more related to a social or economic perspective:
 Short development periods: Shortening the time it takes a product from the moment it is thought of
until it reaches the customer starts to be an important competitive advantage for many companies.
 Individualization of the demand: There is a clear tendency towards a lot size of one since many
customers look for a product that is differentiated from the rest or personalized.
 Flexibility: As previously mentioned, flexibility is the key to being competitive since the system must
be able to adapt to changes effectively.
 Decentralization: For greater speed when making decisions, hierarchical scales should be reduced
within the company.
 The efficiency of resources: Optimization of resources is required to achieve sustainability in the
context of the industry.
Other factors are related to technology:
 Mechanization and automation: More and more technical aids are used to facilitate manufacturing
tasks. In addition, there is a clear trend towards the automation of productive tasks through the use
of automated workstations.
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 Digitization: The growing installation of sensors in the field of manufacturing results in a large
amount of digital data that must be controlled and analyzed. This trend also leads to the birth of
other complementary technologies, such as digital protection or other technologies such as
augmented reality.
 Miniaturization: The technological trend to achieve better performance in smaller spaces results in
more complex products whose manufacture cannot be approached with only human labor.

2.3 Steps for Implementation

One proposed model includes a series of steps with which to guide companies in their search for a
strategy or objective related to Industry 4.0 [23]. This model is composed of three stages:
 Visualize: This stage consists of first familiarizing oneself with general concepts of Industry 4.0 to
relate them to the specific objectives of the company. This stage consists of two phases. In the
entry phase, a series of key concepts are explained, usually by external experts, and after that, the
company’s shareholders expose the current state of the company. With this, shareholders can be
advised on how to evolve the company, which can be done collaboratively given that key
theoretical terms have been stated. In the exit phase, people try to form ideas with a clear drawing
in mind at all times about how they want the company to be in the future.
 Enable: At this stage, we reach a greater level of detail and make a roadmap in which to translate a
series of strategies in a clear and orderly manner. In this roadmap, there is a horizontal axis of time, in
which there is a difference between the short, medium, and long term, and a vertical axis with different
perspectives such as market, product, process, and network perspectives. Fig. 2 shows an example of
what this roadmap would look like.

Short-term Mid-term Long-term

Market

Company-specific Industry 4.0 Vision

Product
Process
Network

Figure 2: Example of a roadmap for industry 4.0

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Once this is done, objectives for each perspective and term begin to be defined, beginning with the
market perspective, in which market segments are defined according to the evolution of future demand.
From this market study, the products to be manufactured are obtained to satisfy that future demand. After
this, the processes to manufacture the products are defined while considering the technology that will be
needed in the production system. Finally, in the network perspective, a structure is defined with the
necessary partners to be able to develop the final product. The objectives contained in the cells are related
by arrows, which can be continuous or discontinuous. The continuous arrows represent the requirements
of the initial (top) perspective for the final (bottom) perspective. The discontinuous ones show possible
success factors for the final perspective. All of this gives a global perspective on the strategy that is
pursued to achieve Industry 4.0.
 Represent: The objective of this point is to move from the strategies previously defined to projects.
Therefore, objectives, work teams, deadlines, priorities, or risks must be defined. At this stage,
there must also be collaboration since the departments affected by the adoption of a project should
make suggestions to adapt it to the maximum. At the end of this stage, the results should be
contrasted with what was stated in the two previous stages.

2.4 Benefits
The creation of factories in the context of Industry 4.0 gives them a series of features and benefits. Some
of these benefits or general characteristics are [24]:
 Mass customization: The new production lines must be able to vary the processes that must be
followed for each production order. The advantage of this is that you can customize each product
while getting a lot size one.
 Flexibility: An intelligent system must be able to adapt to changes, which are made by considering
variables such as time or cost.
 Visibility and optimized decision making: Industry 4.0 provides transparency throughout the chain in
real-time, so decisions can be made much more agile and accurate, thus achieving greater efficiency in
the production process.
 New planning methods: Other variables that are not as common as the efficiency of resources or
energy have a greater weight when optimizing manufacturing processes.
 Create a value from data: Big Data allows the collection of a large amount of data, and its analysis
can generate many improvements at the plant or product level. This data comes from devices
such as sensors.
 Create new services: Industry 4.0 will even create new services before and after the sale of a
product. An example of this is the service offered by the beacons before the sale (some case
studies will later be presented).
 Automation: Increasingly, the production lines will be increasingly automated, providing greater
efficiency, effectiveness and fewer errors.
 Proactive maintenance: The collection of data from the system in real-time by means of sensors will
allow people to know the status of the machines and perform maintenance on them when they begin to
detect unusual data, which may mean that there is some type of failure, for example.
 Connected supply chain: In addition to internal factory transparency, the information will also
be shared in real-time throughout the entire supply chain, thus improving the efficiency of
the supply chain.
 Energy management: For there to be an improvement in terms of energy efficiency, smart meters can
be used to provide real-time consumption and make decisions accordingly.
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2.5 Security
A large amount of data that is generated in the environment of an Industry 4.0 through devices such as
sensors and the fact that part of this data is shared between companies to achieve greater efficiency in the
supply chain make vital factor importance in this field is that of security. One general vision on this topic
presents both the main actors and some aspects to consider [25]. The main actors are:
 People: Those who must manage security, define safety standards, and measure their effectiveness.
 Processes: To meet certain security requirements throughout the development of certain tasks in an
Industry 4.0 environment.
 Object: One of the most important parts is the object itself, which is endowed with “intelligence”
thanks to sensors. Since it is capable of issuing and receiving information, correct security must
be ensured.
 Technological ecosystem: The environment created and the decision mode to ensure the security of
the system.
Some aspects to consider to ensure security in the system is:
 Identification: This point considers the security that objects must have in order to defend themselves
against people.
 Confidence: The level of security that the technological ecosystem can bring to the intelligent object.
 Privacy: This aspect relates people to the ecosystem. Privacy must be considered when collecting,
sharing, and managing data.
 Responsibility: Responsibilities must be defined to avoid problems when an object regulates a
process. Access rights must also be defined in processes that share resources between objects.
 Autoimmunity: This point refers to the objects themselves, which must detect failures or attacks
in the system.
 Security: People must define processes that reduce the chances of failure in the system.
 Reliability: Reliability relates processes to the ecosystem. The availability of certain information must
be ensured over time.

3 Definition and Characteristics of Industrial Big Data

Industrial big data refers to the typical intelligent manufacturing model in the industrial sector, from
customer demand to aspects such as sales, orders, planning, research and development, design, processes,
manufacturing, procurement, supply, inventory, delivery, after-sales service, operation and maintenance,
and scrapping or recycling. Industrial big data is the general term for all kinds of data and related
technologies and applications generated in all aspects of the whole life cycle. With product data at the
core, it has greatly extended its biography. Industrial data has related technologies and applications with
large data capacity, large variety, and fast speed, and in low-value density features, it also features high
accuracy and closed loop. Industrial big data mainly comes from business data related to the production
and operation of enterprises, industrial equipment, production activities, and product-related external
Internet data.
Industrial big data technology is a series of technologies and methods that enable the value embedded in
industrial big data to be mined and displayed, including data planning, acquisition, pre-processing, storage,
analysis mining, visualization, and intelligent control. Industrial big data applications are popular for specific
industries’ datasets, the process of integrating the application of industry big data series technologies, and
methods to obtain valuable information. The essential goal of research and breakthroughs in industrial big
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data technology is to discover new patterns and knowledge from complex datasets and to mine valuable new
information to promote manufacturing companies for industry product innovation, improving the business
level, production operation efficiency, and expanding new business models.

4 Industrial Big Data Reference Architecture

4.1 Industrial 4.0 Reference Architecture
Industry 4.0 was proposed by the German Academy of Science and Technology (Acatech) in the agenda
CPS research project, which is the application of CPS in manufacturing. Germany is a manufacturing country
with a high level of technology in embedded systems and automation engineering. In order to consolidate its
leading position in manufacturing, in 2015, the German Engineering Institute led the release of the “German
Industry 4.0 Strategic Planning Report,” which clearly proposed the basic framework system based on
RAMI4.0. The goal was to start from the manufacturing industry and rely on its excellent equipment
manufacturing strength to use information technology and other means for the “bottom-up”
transformation of manufacturing. The core content shows the Industry 4.0 architecture and the Industry
4.0 component model from the three dimensions of information technology, life cycle, and the value
stream and enterprise vertical layer [26].

4.2 Industrial Internet Architecture

In 2011, the President of General Electric put forward the concept of “Industrial Internet.” In 2012, the
United States launched the Industrial Internet Strategy. Unlike the manufacturing powerhouse of Germany,
the United States is the leader in information technology. Therefore, the United States hopes to reshape the
manufacturing industry from the top of the bottom, such as through CPUs, systems, software, the Internet,
and tools such as big data analysis. In 2015, the US Industrial Internet Alliance IIC proposed the Industrial
Internet Reference Architecture, whose core content is a reference architecture for the industrial Internet with
cross-industry applicability [27].

4.3 Industrial Value Chain Reference Architecture (IVRA)

On December 8, 2016, the official release, of the Japan Industrial Value Chain Reference Architecture
(IVRA) marked the formation of a basic model for the interconnection and interoperability of smart factories
in Japan. In response to the global manufacturing upgrade strategy represented by German Industry 4.0,
Japan has adopted three series of implementation actions to promote the upgrading of manufacturing.
First, they promote the development of IVI in the industrial value chain and establish a consortium
kingdom made in Japan. Second, through the robot revolution plan agreement, they use industrial
machinery and small and medium-sized enterprises to explore ways of field coordination and enterprise
cooperation. Third, they use IoT to promote the laboratory, which has intensified innovations in new
business cooperation with other fields [28].

4.4 Intelligent Manufacturing System Architecture

“Made in China 2025” is the action plan of the Chinese government to implement the first decade of
a strategy to become a strong manufacturing country. Through the in-depth integration of
informationization and industrialization, the development of the entire manufacturing industry will be
driven to achieve the goal of “Made in China 2025” and realize the integration of technology,
products, services, and industry derivatives. This is being done through the construction of smart
factories to achieve intelligent production and intelligent manufacturing, to achieve the transformation
from centralized production to networked off-site collaborative production, the transformation of
traditional manufacturing companies that want cross-border integration enterprises and the
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transformation from large-scale mass production to mass customization. In 2015, the China National
Standardization Administration Committee built the intelligent manufacturing system architecture in
three dimensions: life cycle, system-level, and intelligent function.

4.5 Industrial Big Data Architecture

The core of the term “architecture” is carrying the pressure of the upper layer through a series of
component combinations in a system. The system architecture is “the basic components of a system and
the design principles to follow, as well as systems, components, and external environments.” In order to
better understand the connotation of industrial big data, there is a communication tool used by industrial
big data related practitioners. Based on the German Industry 4.0 Reference Architecture, the US
Industrial Internet Architecture, and the China Manufacturing 2025 Standard System, the industrial data
architecture diagram presents an industrial big data reference architecture that provides versatility and
consistency for cross-industry big data applications.
The architecture consists of three dimensions: the life cycle and value stream, the enterprise vertical
layer, and the IT value chain. The life cycle and value stream dimensions are divided into three phases:
R&D and design; production and supply chain management; and operation, maintenance, and services.
According to the type, application, and value innovation, the enterprise vertical layer includes a CPS,
management information system (MIS), and interconnection platform from bottom to top. System Internet
+ discusses the work required by all layers of the enterprise to achieve industrial big data applications
and industrial transformation IT value chain refers to leading the business architecture, information
system architecture, and technical architecture of industrial big data. In the technical framework, targeting
industrial big data and industrial enterprise characteristics, the technical components required to
implement industrial big data applications are discussed. The industrial big data architecture is shown in
Fig. 3 [29].

Figure 3: Reference architecture for industrial big data [29]

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5 Governance of Industrial Big Data

Industrial big data governance is an institutional framework for assessing, guiding, and monitoring an
organization’s industrial big data management and utilization. It passes a strategic policy, the establishment of
organizational structure, a clear division of responsibilities, etc., to achieve risk control, safety compliance,
performance improvement, and value creation of industrial big data, as well as provide innovative big data
services [30]. Industrial big data governance is critical to ensuring the optimization, sharing, and security of
industrial big data. An effective industrial big data governance program can return value to the business by
improving decision making, reducing costs, reducing risk, and improving security compliance, ultimately
reflecting increased revenue and profit. The role of industrial big data governance can be summarized as four points:
1. Effective industrial big data governance can promote industrial big data service innovation and value
manufacturing
2. The scientific industrial big data governance framework helps to improve the organization’s
industrial big data management and decision-making levels
3. Effective industrial big data governance can produce high-quality data, enhance data credibility and
reduce costs
4. Effective industrial big data governance helps improve compliance and security controls and reduce risk
Industrial big data governance should adhere to the principles of strategic consistency, risk control,
operational compliance, and performance improvement. Its governance areas include Strategy,
organization, industrial big data quality, industrial big data security, industrial big data innovation
applications, industrial big data lifecycle, and industrial big data architecture.
As an important strategy for manufacturing enterprises, industrial big data can be used not only to
improve the operational efficiency of enterprises, but also to support business process and business model
innovation, which is embodied in intelligent production, network collaboration, personalized
customization, remote services, platforms, and many application scenarios. By planning and building an
enterprise architecture for an industrial big data business, the value of industrial big data is obtained. The
value obtained is compared with the expectations and prospects of the business strategy to form a closed
loop of sustainable improvement, as shown in Fig. 4.

Industrial Big
Company Enterprise Industrial Big
Data Business
Strategy Architecture Data Value
Strategy

Industrial Data Application Scenario

Business Architecture
Intellectual
Personalization
Production
Information System Architecture
Operational
Increase Standby Governance
Dimension
Effectiveness Network Remote Innovation Application Data System
System
Association Service Architecture Architecture

Platform Application
Technology Architecture

Figure 4: Proposed industrial big data business strategies and enterprise architecture
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Manufacturing companies need to collect, organize, analyze, and summarize aspects of their business,
such as the organizational structure and products provided according to their own competitive advantages.
They establish a clear relationship with services, markets, customers, resources, business potential,
stakeholders, the relationships between these functions, and entities in the industrial big data business
architecture and its informationization strategy.

6 The Strategic Role of Industrial Big Data

For a manufacturing enterprise, big data cannot only be used to improve the operational efficiency of
enterprises but more importantly, it can show how to change business processes and business models
through the capabilities provided by next-generation information technologies such as big data. From the
perspective of enterprise strategic management, we analyze the three main relationships between big data
and related technologies and corporate strategies, as shown in Fig. 5.

Figure 5: Industrial big data strategic role

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 Big data and core competencies: Big data can be used to improve the operational efficiency of an
enterprise and enhance its core competencies.
 Big data and value chains: Big data and related technologies can help companies run-flat and
accelerate the flow of information in the manufacturing process.
 Big data and manufacturing models: Big data can help change manufacturing patterns and form new
business models. Among them, the typical intelligent manufacturing modes include automated
production, personalized manufacturing, network coordination, and service transformation.
The core competency of an enterprise refers to a combination of complementary skills and knowledge
within an enterprise. It has the ability to bring one or more businesses to the best level in a competitive field.
Core competencies consist of insightful predictive capabilities and frontline execution capabilities. Insights
are mainly based on scientific and technical knowledge, unique data, product creativity, superior analysis,
and reasoning skills. Frontline execution capabilities arise from situations where the quality of the final
product or service will change due to the quality of the frontline staff’s work. The core competency of an
enterprise is the overall resources of the enterprise. It involves all aspects of the company’s technology,
talents, management, culture, and cohesiveness. It is the common behavior of all departments and all
employees. Only one enterprise has the ability to operate on the requirements of success. An enterprise’s
strategic capabilities and corresponding organizational resources can survive, and big data can play a role
in improving the insights of senior executives and the ability to work and serve at the enterprise
executive level.

7 Big Data and Business Model

Big data can be used not only to improve the operational efficiency of enterprises but also to support
business processes and business model changes [31]. There are four modes: “personalization,” “intelligent
manufacturing,” “cooperative production,” and “service extension.”

7.1 Personalization
As an important symbol of the transition from traditional industry to the intelligent manufacturing stage,
personalized customization utilizes an Internet platform and smart factory construction to directly translate
user needs into production orders, as well as carry out user-centered personalized customization and on-
demand production to effectively meet market diversity demand, solve the long-standing inventory and
capacity problems in the manufacturing industry, and achieve a dynamic balance between production and
sales. Personalization is the automation of data flow. The application of industrial big data technology can
automate data flow. With the accumulation of data accumulated by various design tools, simulation
models, management software, and production equipment, information physics systems can be developed
in enterprises. Testing, production, logistics, management, services, etc., in the horizontal, vertical, and
product lifecycle data integration process of the enterprise, data exchange, interoperability,
interoperability, or invisible automation, for human intervention.

7.2 Intelligent Production

The development trend of intelligent production is to integrate a series of manufacturing resources such
as materials, energy, equipment, capital, technology, information, and manpower and to produce high quality
and high efficiency through advanced manufacturing technology, advanced management techniques, and
advanced manufacturing processes. Highly flexible, low cost, low labor, low consumption, multi-variety,
full-size products. Intelligent equipment and modern production techniques are becoming more and more
popular in key industries, and the informationization of production processes is developing in-depth.
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Industrial big data technology can be used to perform various analyses on various state parameters
collected on industrial manufacturing production lines, such as equipment diagnosis, power
consumption analysis, energy consumption analysis, and quality accident analysis (including violation
of production regulations and component failure). First, using big data, one can analyze the entire
production process and understand how each link is executed. Once a process deviates from the
standard process, an alarm signal is generated to detect errors or bottlenecks more quickly. It will also
be easier to solve the problem. Second, using big data technology, one can also create virtual models of
the production process, simulate and optimize the production process, and help manufacturers improve
their production processes. For example, in energy consumption analysis, sensors are used to monitor
all production processes in the production process of the equipment, and it is possible to find abnormal
or peak energy consumption and optimize the energy consumption in the production process through
big data analysis techniques.
For multi-variety and small-batch production modes, refined real-time data collection methods (such as
MES, DCS, and other systems) and variability will lead to a sharp increase in data, plus more than a decade of
information historical data. For APS, which needs a quick response, this is a huge opportunity. Big data can
give enterprises more detailed data information, find historical predictions and actual deviation probabilities,
combine various constraints, develop pre-planned scheduling through intelligent optimization algorithms,
monitor actual deviations between plans and sites, and dynamically adjust plans. In order to help
enterprises, avoid the defects of “portraits,” they directly assign group characteristics to individuals (work
center data is directly changed to specific equipment, personnel, molds, etc.), and through data correlation
analysis and monitoring, enterprises can plan for the future.

7.3 Networked Collaboration

The core of networked collaborative manufacturing is the synergy between R&D and supply chain
management among enterprises. The horizontal integration of two-in-one integration is an important
indicator for enterprises to enter the stage of comprehensive integration. Networked collaborative
manufacturing is not a new concept. The aviation and automobile industries have been engaged in
networked collaborative manufacturing for decades. For example, the C919 large passenger aircraft
developed by China Commercial Aircraft Corporation has realized the cross-domain and multi-agent
globalization of suppliers through a networked collaborative manufacturing platform. Synergistic
innovation has shortened the development cycle, reduced the development cost, and improved the
development quality and development efficiency.
The development of a new generation of information and communication technology has given new
meaning to networked collaborative manufacturing. With the help of the Internet or an industrial cloud
platform, enterprises can develop new modes such as collaborative R&D, crowdsourcing design, and
supply chain coordination among enterprises, which can effectively reduce the cost of resource
acquisition, greatly extend the scope of resource utilization, break the closed boundary, accelerate the
coordination from single to industrial cooperation, and transform promote the overall competitiveness of
the industry.

7.4 Service Extension

Manufacturing service is the transformation of manufacturing companies from a manufacturing-centric
to a service-oriented in order to gain a competitive advantage. Manufacturing service has two meanings.
First, the efficiency of internal services is increasingly important for the competitiveness of manufacturing
companies. Second, external products related to products are becoming more complex and important to
customers. Industrial big data can promote the efficiency of internal and external services and enhance the
value of services through intelligent services. The essence of intelligent services in the industrial field is
1188 CMC, 2021, vol.66, no.2

intelligent products plus perceptual control capabilities and big data analysis. Online health detection and
faults can be provided by collecting and analyzing data such as self-work conditions, the surrounding
environment, and user operation behaviors during product use. Services such as diagnosis and warning,
as well as support new service models such as online rental and pay-per-use, create new value for
products and realize the service transformation of manufacturing enterprises.

8 Proposed Analysis
8.1 Equipment Characteristics under Industry 4.0
In order to meet the requirements of various factors of Industry 4.0, the basic equipment of Industry
4.0 should have six characteristics: interoperability, virtualization, distribution, real-time, service
orientation, and modularization.
 Interoperability
Interoperability means that all devices in a plant can communicate with each other through open
networks and compatible technical standards. Device interoperability is at the heart of plant intelligence
and automation. In the intelligent factory, between different equipment, between equipment and people,
between people and other people through the Internet of Things and the service network, so as to realize
the interconnection and intelligent interaction of all links, which requires mutual equipment. Compatible,
accurate communication, consistent communication standards, and even design, production, quality
standards, so this will be a major change in the entire equipment industry.
 Virtualization
Virtualization refers to the ability of a device to monitor physical processes, monitor data, and connect to
a virtual plant model to create a virtual version of the real world. At the same time, each device has its own
virtualization features that can be virtualized as part of the plant model. The virtual model can simulate
various virtual scenarios based on monitoring data to identify risks, reduce errors, and reduce
improvement costs.
 Distributed layout
A distributed layout refers to embedded computers that enable individual control and independent
decision making of devices. With the development of customer customization and product diversification,
flexible production lines will be more and more widely used, and the way to control the entire production
line neatly is no longer desirable. The embedded control system can make every device or device unit
have the ability to make independent decisions and identify which work steps or actions should be taken
under which instructions. Therefore, in the future, centralization will be more suitable for the setting of
production targets, and a distributed layout will be applied more to the production process.
 Real-Time Capability
Real-time capability is the immediacy of data collection and analysis. Of course, this also includes the
real-time nature of the data sent by devices. The state of the smart factory requires real-time, uninterrupted
monitoring and analysis, and externally entered information requires real-time feedback to detect anomalies
and meet new demands.
 Service Orientation
Service-oriented means that a device meets the needs of users through service networking, and the
service can be either internal or open-facing. Every industrial revolution in history is ultimately aimed at
meeting human needs, and Industry 4.0 is no exception. Products will extend from a single item to a
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product and service. The equipment must consider human factors from the beginning of the design, including
user-friendliness, convenience of maintenance, etc. Through the network of services, the equipment is
integrated into an organism, so that the internal production demand and external customer needs can be
reacted to immediately. Industry 4.0 is more able to meet these requirements.
 Modular
Modular means that equipment or equipment components are manufactured to standards and can be
assembled, replaced, and expanded as needed, including standardized hardware and software. New
modules can be automatically identified for added versatility and flexibility. In view of the Industry
4.0 requirements for advanced equipment, the overall replacement of smart devices’ cost is quite high.
Modular and flexible manufacturing solutions that can be rapidly expanded will become research
priorities and trends.

8.2 Equipment Application Case under Industry 4.0

According to the description of the Industry 4.0 Working Group, objectively, there is currently no smart
factory that can fully meet the standards of Industry 4.0, but some equipment or certain parts of the factory
have met the requirements.
 Tesla Battery
Tesla is currently the leader in the electric vehicle industry, and its core is the battery power system.
Tesla’s power system is actually a system of more than 7,000 small cylindrical lithium “18650” batteries
(18 mm in diameter. 65 mm long) provided by Panasonic. The voltages of these batteries remain exactly
the same, providing strong power, stable safety, and low levels of wear. A large number of sensors are
used in the battery system, and the sensors transmit data to the battery management system for battery
state calculation, energy management, thermal management, safety management, equalization control, and
communication functions.
Tesla batteries are a typical example of modular equipment. They consist of thousands of modular
micro-batteries, consisting of micro-battery integrated battery packs, that are integrated into a Tesla
battery. The integrated battery is a module of the electric vehicle. Each micro battery has its own running
feedback system to prevent damage to the battery pack caused by single battery failure and realize the
distribution of battery pack control. The Tesla battery replaces the fuel/gas engine of an ordinary car and
forms a perfect intercommunication system with other linkage units of the car. The battery management
system performs simulation calculation and analysis through real-time feedback from sensor data and
issues instructions to keep the battery running smoothly. At the same time, the battery management
system controls the output of the battery current to accurately provide the necessary power for the car to
travel according to the requirements of the power system.
 German Brau Brewing Company Logistics Management Solution
Brau is a famous beer brand in Germany, and the Brau Brewing Company combines sensors and virtual
software to form a logistics management system. This combination effectively reduces the probability of
empty running of the forklift, increases storage space utilization, and reduces gas consumption and CO2
emissions. By simulating the entities involved in the warehousing activities in the real world in the
software system, the production process can be automatically scanned into the warehouse. The functions
are warehousing space planning, transportation instruction presentation, disordered storage of goods,
misoperation correction, truck filling, and other functions.
1190 CMC, 2021, vol.66, no.2

8.3 Analysis with Respect to China’s Equipment Manufacturing Industry

Given that Industry 4.0 is still in its infancy and its requirements are very high-end, the realization of
mature smart factories may still have a long way to go, and the mechanical equipment that is the basis of
smart factories has been widely used in some factories and products. Since the concept of Industry
4.0 was put forward, the focus of the industry has focused on the ambiguity of the vision of Industry 4.0,
and there are few specific discussions on its implementation. This paper summarizes the six
characteristics of basic equipment, gives the basic and specific standards for equipment that meets the
requirements of Industry 4.0, and provides a reference for the development of equipment manufacturing
in the future.
From the two application cases listed in this article, it can be seen that the difference between Industry
4.0 and the previous three industrial revolutions is that it is not an energy revolution, nor a technological
subversion, but a comprehensive innovation of technology combinations (admittedly, technology in this
process is also evolving, so creativity will dominate the development of Industry 4.0 in the future).
China’s equipment manufacturing industry started late, but it has accumulated rich experience and a
considerable technical level in the decades of development. It is necessary to make full use of the
opportunities of Industry 4.0 to narrow down and even catch up with the equipment manufacturing level
in developed countries.
Equipment manufacturers must lay a solid foundation and make excellent products. They should not be
in the midst of the tide of Industry 4.0, “scarring flowers and fascinating eyes,” blindly speculating concepts,
and pursuing high-tech. The level of intelligence that Industry 4.0 expects to achieve is realized by the
organic combination of basic functions and components of basic equipment. These basic functions and
components have been mastered by equipment manufacturers in China to a certain extent. Equipment
manufacturing enterprises should base their own products on the requirements of Industry 4.0. Product
quality, optimize product features and create upgraded intelligent devices. Second, the equipment
manufacturing industry should strengthen the integration of other elements of Industry 4.0, such as IoT,
cloud storage, and big data. Third, the state should promptly introduce relevant policies, guide the
support of equipment manufacturing enterprises to transform and upgrade them, and proactively promote
the development of equipment manufacturing in general and compatibility standards.

8.4 Industry 4.0 Case Analysis under Big Data

Luo Xiang designed a personalized customized intelligent platform using the four business models of
industrial big data: personalized customization, intelligent manufacturing, collaborative production, and
service extension, which realize enterprise cost reduction and enterprise efficiency improvement. This is
an example of creating value. Suzhou Luoxiang Software Co., Ltd. (Roman) is an IT company that
provides information management solutions for manufacturing companies. Based on parametric design,
the customized intelligent platform can realize the manufacturing and service management of the whole
life cycle based on product parameters, such as sales, design, manufacturing, supply chain, delivery, and
service, as well as create customized products for the equipment manufacturing industry. Luo Xiang
developed a personalized customized intelligent platform for Yingwo through informationization planning
using the network to transmit the needs and data of elevator terminal customers to the platform center
database, as well as cloud computing and IoT technologies to realize quotations, design, manufacture,
and services. The intelligent, automated, data-based, and network-based processing of the entire process
completes the customized production and service for elevator terminal customers.
The platform internally uses product parametric graphical modeling and networked supply chain
coordination and establishes personalized customer requirements to automatically connect and interact
with factory manufacturing resources end-to-end, as well as externally through crowdsourcing models
CMC, 2021, vol.66, no.2 1191

and platforms for better market integration and service resources. Therefore, it can better help enterprises to
build a modern business model of C2M and realize rapid product and service response, professional
manufacturing capability, and high-cost performance to meet the needs of large-scale customized production.
The C2M elevator personalized customized intelligent platform is leading Yingwo Elevator from a
traditional elevator production process to an intelligent production process to realize the whole lifecycle
management of elevator products. It provides a typical demonstration role for elevator enterprises so that
it can be promoted and applied throughout the industry. For example, in the manufacturing process, the
product drawings, structure, process information, production procurement plan, and workshop scheduling
plan are automatically generated by collecting the product parameters and user requirements to realize the
integration of the supply chain. Information such as the quantity, progress, and quality of the product, and
the status of a device is grasped by collecting data such as equipment data. Real-time dynamic reflection
of production processes, adjustment of production plans, control of processing quality, recording of
processing costs, and other functions
In addition, in the after-sales maintenance process, focus on elevator after-sales and maintenance
processing and recording, record the corresponding operating parameters, parts or packaging parts are
prone to use problems and problems, to determine whether there are design-related problems and
parameters, so that optimize the design and reduce operational failures. The system integrates with the
IoT system to collect the product operating status and operating parameter data, monitor the product
operation status, generate preventive maintenance plans, prepare spare parts for repair and maintenance
according to the plan, record maintenance execution, and master customer service. Complaint handling,
maintenance information traceability, maintenance service processing time, cost, quality, and other
information. The C2M elevator personalized customized intelligent platform can achieve the user-
centered intelligent analysis of the elevator industry through continuous data accumulation, research and
development, production, quality, service, operation big data, and building an elevator industry data
center. Tab. 1 shows the application value achieved by Yingwo Elevator by implementing the C2M
elevator personalized customized intelligent platform.

Table 1: Application value of the personalized customized intelligent platform

Indicator item Value point Before going online After going online
Delivery period Contract processing time 7 days 2 days (down 71%)
Order breakdown and planning time 3 days 0.5 days (down 83 %)
Production and procurement cycle 10 days 7 days (down 30%)
Contract handler 6 people 2 people (down 67%)
Workload Planner 4 people 1 people (down 75%)
Related statisticians 5 people 2 people (down 60%)
Planned error rate 10% 1% (down 90%)
Quality control Packaging and shipping missing parts 20% 1% (down 94%)
Cost calculation accuracy 0 90% (up 90% increase)
Cash flow Annual inventory turnover 5 times 10 times (up 100%)

9 Conclusions
This paper highlighted the role of Industry 4.0 in the future manufacturing and production process. The
key performance indicators and remarkable features were discussed in detail. Manufacturing enterprises are
1192 CMC, 2021, vol.66, no.2

facing the challenge of transformation and upgrading. The core issue that enterprises should pay attention to
is how to use the advanced technology represented by industrial big data to realize enterprise value. This
paper clarified the value and realization of industrial big data to enterprises and demonstrated that
innovation through big data business models can help enterprises achieve value. We hope that these
results can provide a reference for readers who are concerned about industrial big data and its value.
The value of big data is still a relatively new concept. It is worthwhile for experts and enterprises in the
field of big data to communicate and work together to realize the transformation and upgrading of the
manufacturing industry. With the surge of Industry 4.0 under the influence of multiple factors such as
policy, capital, and human resources, it is more prudent to meet the requirements of Industry 4.0. The
popularity of the equipment will become an irreversible trend while Industry 4.0 is still in its infancy, and
the equipment manufacturing industry is meeting the requirements of Industry 4.0.
There is a lack of clear understanding, so through the literature summary, this article described the six
characteristics of equipment that meet the requirements of Industry 4.0, namely interoperability,
virtualization, distribution, real-time processes, service-orientation, and modularity. We hope to have
some inspiration for equipment manufacturing. To achieve these characteristics, equipment manufacturing
enterprises need to focus on their own optimization and upgrading, as well as learning to transcend. They
also need the guidance and support of relevant national policies to promote great changes in the
equipment industry and thus realize the rapid development of the equipment manufacturing industry. This
work can further be extended by focusing on the impact of the dual-channel supply chain under Industry
4.0 and considering offline and online retailers’ trade-offs in this context.

Acknowledgement: The authors (Basem Alkazemi, [email protected]; Ali Safaa Sadiq, ali.sadiq@wlv.
ac.uk) would like to thank deanship of scientific research (DSR) at umm Al-Qura University for their partial
funding the work (Grant# 17-COM-1-01-0007).

Funding Statement: This research was supported under the National Research Foundation (NRF), Korea
(2019R1C1C1007277) funded by the Ministry of Science and ICT (MSIT), Korea.

Conflicts of Interest: The authors declare that they have no conflicts of interest to report regarding the
present study.

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