Industry 4.0 : transforming business processes in manufacturing

Melissa Teo, DigitalCFO Asia | 30 March 2022

Industry 4.0 boosts robotization on top of cyber physical systems and Internet of Things (IoT)

The manufacturing plant of today is a sea of robotic arms diving around conveyer belts, sensors identifying and classifying products. Plant operators roam about monitoring the process by looking at handheld digital screens. Industry 4.0 boosts robotization on top of cyber physical systems and Internet of Things (IoT). Automated machines controlled by algorithms are autonomous workers able to make decisions independently, while being interconnected with the entire plant’s ecosystem of devices and data. Human operators can adopt a ‘hands-off’ approach, while also overseeing the machines’ comprehensive data output. 

Cyber physical systems and IoT collects massive amounts of data. It includes operational data (number of machines one personnel is monitoring, or material wastage amounts), manufacturing floor output data (number of items made per minute), financial data (number of items ordered and dispatched). When adequately leveraged, these data will uncover strategic insights on analysing operational costs to maximise profits. 


Acquiring industrial data with real-time value

A hurdle, and also an aim, in utilising data for monetisation is to build data architecture which is scalable in flexibility. Meaning, a data system which can adapt to the requirements of the operator such as changes in production volume which entails changes in data storage space needed. A scalable solution would be industrial cloud infrastructure. The service provider handles backend issues, so users can focus on apply the cloud tools to operations and company’s growth plans. 

Siemens, IBM and Red Hat have collaborated to launch a hybrid cloud programme for manufacturers to derive real-time value from operational data. Siemens’ software will adopt IBM’s open hybrid cloud approach, which is built on Red Hat OpenShift, to expand the functions of MindSphere®, Siemens’ industrial IoT as a service solution.

There are two notable advantages to utilising open cloud industrial infrastructure. Firstly, isolated apps exclusively used at certain parts of plant operations can be changed to open source apps on plant-wide data platforms. This allows for data from all plant sectors to be merged into one. Secondly, data is freed from isolated silos to obtain machine learning predicative insights, which helps pre-empt hiccups in supply chain processes. These advantages work hand-in-hand to provide a comprehensive overview of plant operations for pinpointing areas needing optimisation.

An agile CFO 4.0 for industry 4.0 

CFOs in manufacturing sectors will be met with researching and planning the costs of digitalising manufacturing process. The cost involved goes beyond purchasing new machines and cloud infrastructure services. 24/7 reliable IT support is required to ensure operations run smoothly. Regular maintenance of machines and software updates is also important for securing data privacy. 

Investment in IT manufacturing goods is often perceived as high risk with volatile returns. With an ever-changing digital landscape, selecting the right machines and cloud services capable of growing with one’s company vision, becomes an uphill battle. Controlling manufacturing costs with traditional financial metrics is no longer a viable option. 

A solution for testing potential components in the manufacturing process before planning a purchase, is to use a digital twin. Alternatively known as a digital replica, it is a virtual copy modelled on a real-life component, mirroring it’s functions and interactions with other devices. Such stimulations can predict how it will perform and integrate with existing components. 

According to a report by SYSPRO on the outlook of a manufacturing industry CFO 4.0, 48% of those surveyed agree the capability to build a business case on return on investment is a necessary skill. 57% also support the idea that it is crucial to be a digitalized and automated manufacturer. Skills that has always been in-demand such as strategic business knowledge and insights on management risk, are all the more necessary to remain competitive in industry 4.0. 


Being agile is key to weathering through disruptions and emerging stronger. The modern CFO 4.0 works in a time of exciting changes and discoveries. Harnessing lessons learned from progressing from industry 3.0 to industry 4.0 will enable CFOs to meet the hurdles of industry 4.0 head-on.


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