Industrial development work towards Industry 4.0 and 5.0

Industry 4.0 and Industry 5.0 promise opportunities through digitalization and advanced technology. The problem is that many companies are far from having the client expertise that would provide the long-awaited benefits. This article provides suggestions on how you can move forward if you want to develop industrial companies.

DigiCORE, a lab and a demo facility at RISE.

Industry 4.0 and Industry 5.0 promise opportunities through digitalization and advanced technologies such as artificial intelligence and collaborative robots. The problem is that many companies are far from being able to describe, order and implement the digitalization solutions that would really provide the long-awaited benefits. This is covered in a podcast episode Designing the Robot Revolution: How to Get Along with your Robot Co-Worker, With Sandra Mattsson from RI.SE i Apple Podcasts that highlights the challenges of implementing bots. To grow as a company together with technology, a deeper understanding of what corporate culture and motivation mean, how continuous improvement can be achieved and expertise in automation and digitalization is needed. This article explains these three points further and gives suggestions on how you who want to develop industrial companies can move forward.

An introduction, Industry 4.0 vs Industri 5.0

The vision of Industry 5.0 is to include people and society more than has been done in Industry 4.0. The European Commission has said: "Industry 5.0 provides an approach to industry that goes beyond efficiency and productivity as its sole objective, reinforcing its role and contribution to society.

It puts workers' well-being at the heart of the production process and uses new technologies to bring prosperity beyond jobs and growth while respecting planetary production boundaries." (translated from English). Industry 4.0 or digitalisation was very much about putting smart technology at the centre. This meant using, for example, the Industrial Internet of Things, smart sensors or digitized systems in a smart way to increase the value of production companies' processes. Please read about examples of digitalization through focus areas on digital copies, visualization, smart working methods, the connected factory, additive manufacturing, attractive work, new business models, collaboration people and automation, environmentally smart production, digital value chains, innovation and artificial intelligence. You will find links to training courses at the end of this article.

Industry 5.0 rests on three pillars: sustainability, resilience, and human-centered production, see Figure 1. Within each area, there is previous research, but in many cases there is still a lack of application or good examples within companies. Companies thus find it difficult to meet the challenge practically. We have identified three areas we believe are important to work on that contribute to the companies' Industry 5.0:

  • Agile/green processes
  • Lifelong learning
  • Safe workplaces
Figure 1: Industry 5.0’s three pillars.

Due to the fact that we already have major challenges in demographic development in Sweden (distribution between age groups), it is important to ensure technology that is easy to adapt to people and that is easy to understand. These technologies should be developed together with a lifelong learning strategy throughout working life. Virtual Reality, VR (Virtual Reality) and Augmented Reality (AR) can be important technologies for Industry 5.0. In terms of sustainability, the development of new materials and circular flows were mentioned. To reach resilience, flexible production systems are needed that can be adapted to the challenges that exist, such as pandemic and war. Technologies that are important to consider here are additive manufacturing, digital copies and industrial IoT. To become a resilient company, you need to develop working methods that strengthen the ability to detect disruptions at an early stage, manage changes while developing the capability.

Corporate culture and motivation

Many must be motivated, both management and employees must be involved in the company's change work, if everyone is motivated, it leads to the socio-technical system to be developed actually being used. Culture and motivation are difficult and therefore many companies underestimate the time it takes and also the power available. When it comes to diversity and minorities, there is an incredible amount to work on that creates a difference for the company. Some examples where increased diversity makes a monetary difference (World Economic Forum 2020):

• Increased profitability by 25-36%

• Up to 20% higher innovation rate

• 19% more revenue for innovation

• Up to 30% greater ability to find and reduce business risks

• Statistically significantly higher engagement and retention of staff

The question is how companies can do to succeed. The difficult thing is not to say what is to be done, but to implement what has been said. To succeed, it is important to release the untapped power that exists within all organizations.

Learn to break down the challenges rather than break down the goals. Goal breakdown, MBO – Management By Objectives, usually means breaking down goals of the same type down to group or even individual level. For example, a productivity target of +10% might mean that each group gets its own goal of x%. But it may be completely different types of goals that are most relevant in an individual group to achieve the total goal. In a group, for example, it may be a machine that malfunctions and the goal may then be to increase accessibility instead. Therefore, it is better to break down the challenges instead ("What is most important to us if we are to contribute to meeting the overall challenge?") and then set goals on what is most important locally. In addition, goals that are established closer to the group are usually more relevant, accepted, flexible and challenging. Don't forget to visualize!

By including the staff in all decisions, it is possible to create a higher commitment that in the long run gives higher returns and greater opportunities to reduce risks (business and production). Something that is relevant to consider is the difference between extrinsic and intrinsic motivation:

Figure 2: Extrinsic and intrinsic motivation in the form of an extrinsic drive to make money versus an intrinsic drive to create a better environment for all people.

Extrinsic motivation can be described as an individual being driven by external factors such as rewards, pressures, demands or to live up to their own self-image. It can be about making money as in Figure 2. Intrinsic motivation is instead about having an inner drive to get an outlet through what we do and that that behavior leads to satisfaction. It can cause an individual to voluntarily take on tasks that are challenging. The inner drive increases when we use our own skills and provide an experience of self-control. Here, leadership is important. A leader wants to make his employees feel (Lundberg, 2019):

• that they like what they do

• that they have interesting tasks

• that they feel that they are developing

• that they matter

• that they can influence their work

• that they are part of a larger purpose

• that they receive attention for work done and valued feedback. These are powerful motivational tools – the same tools that the leader himself must learn to use to influence employees.

Continuous improvement

If improvement work takes place periodically, we learn to work as usual between sessions. If improvement work takes place daily, we learn a way of working that includes continuous improvement.

We see that operational staff at both large and small companies do not always keep up with all new digital technology and that it risks complicating the business instead of streamlining / improving. The solution to this is to see what function the digital solution should provide and then simplify the system first and digitize later. In parallel with the simplification of the system, it is usually also effective to work on developing the staff's digital competence. Not only with the current technology but also practice digital training and development tools to enable more distance and e-learning and support. Furthermore, when it comes to sustainability, we have also seen that digital support of the production system (lean, six sigma or similar) can provide indirect support for sustainable development.

In which direction should the company work with its improvements? Here we would like to recommend the discussion papers, the automation staircase and the digitization staircase that provide support in that discussion. What skills will be required in our next development step, how do we access it?

Figure 3: The digitalisation staircase is used as a support to companies to create consensus in a digitalisation journey. We discuss where we are today, what step we want to reach and what it takes to climb to that step.

To succeed in long-term improvement and change work requires that many pieces of the puzzle fall into place. There will only be power in the work when both leadership and employees have the conditions to work in a common direction. If we do not have vision, competence, motivation, resources and action plan in place, we risk failing, compare figure 4.

Figure 4: Conditions that need to be met to succeed with a change, and the situation that may arise if any prerequisite is not met.

Competence in digitalization and automation

We need to have access to the right skills at the right time as development is fast. Some skills will no longer be needed, other knowledge needs to be upgraded and others are completely new knowledge. Tailor-made training is highlighted as something that is increasingly important.

In order to reach the opportunities of digitalization, it is required:

  • Good support so that you as a company can grow together with the technology where companies can go from understanding-application to ability
  • Motivation from leaders and support for continuous improvement
  • Knowledge in automation and digitalization

What we see as keys is in addition to corporate culture and motivation that we have told you about further up:

  1. Networks that convey the current situation, opportunities, lessons learned from others, study visits and opportunities to try before investing
  2. A coach who suits your company, who understands the production flows of material and information, and identifies problem areas, and who actively drives the issue together in the company
  3. The ability to identify digitalization and automation candidates who lead the company in the right direction

These keys can be part of a larger context where companies can develop their skills together with experts, universities, other companies etc., see Figure 5.

Figure 5: Picture of the development of firms from understanding to ability. *edig (Industrial digitalisation in practise | edig).

RISE is involved in number of programs for SMEs that can provide a cost-effective initial resource in development work. We are also happy to guide you to other actors who can contribute to your development.

Below we develop the above keys further.

Key 1: Networks that convey the current situation, opportunities and lessons learned from others

Challenges and opportunities for industry are increasingly sustainability and circularity. This includes own production resources, supply chains and products. Electrification and electromobility have a particular emphasis now and in the future. There are driving forces here for building flexible and efficient production, where automation and digitalisation are enablers. There are several networks and initiatives underway where companies can learn more, as:

Key 2: A coach that fits your business

There are many issues to take care of in order to successfully navigate correctly for the future, whether it is about developing business, strengthening the value stream or creating even more attractive workplaces. In addition, we will keep up the pace of improvement work while production is ongoing at a high pace. Experience shows that it can be valuable to get help from an external resource that you trust. The advantage is a new pair of eyes that have experience from more businesses, and that you can juggle with to even better value your own business.

Being able to follow up activities and reflect on what is happening is a skill that you need to acquire, request / choose a coach that suits your company and that continuously encourages a certain pace, and that requires commitment from both management and employees. There are several types of development programs in the country for SMEs that you can take part in, and that have cost-effective arrangements. Here's an example: (Swedish).

Key 3: Identify your automation candidates

Do you have the right conditions for your automation investment? Do you have the right client competence? The project Robotlyftet resulted in an accurate prerequisite study with a proposal for an action plan. Get help from an experienced coach to conduct a prerequisite study and you will get the most out of it. Robotlyftet ended in 2021, but here you can see examples from some of the companies that participated: Tillverkningsindustrier i Sverige berättar om sin medverkan Robotlyftet och vad det har givit dem. - YouTube (Swedish).

There is easily accessible knowledge here

Get inspired, do your business intelligence, be trained or create your own workshops with the help of the knowledge platform edig Industrial digitalisation in practise | edig. Here you will find more than 200 articles, podcasts and movies that give you and colleagues input in the direction Industry 4.0 och 5.0.

Lundberg, T, 2019. Motivationskoden


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This article is categorised as Intermediate  |  Published 2023-10-17  |  Authored by Sandra Mattsson