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Manufacturers are missing the point of i4.0


According to new research from KPMG International, the fourth industrial revolution (Industry 4.0 or i4.0) requires transformational change at a pace the majority of manufacturers are not matching. If manufacturers continue on the current trajectory, KPMG warns they are likely be disrupted by competitors and new market entrants. KPMG is calling for CEOs to form a top-down strategy and implement large scale change now in order to meet the realities of manufacturing in today’s market.

Commenting on the research, Doug Gates, Global Head of Industrial Manufacturing at KPMG, said, “Few organizations have developed holistic, end-to-end interconnectivity – our definition of the highest level of i4.0 maturity – among today’s breakthrough i4.0 tools and technologies. Most are still at the beginning stages, where investment is made due to projected cost savings. The digital revolution is about so much more than efficiency, and manufacturers not embracing a new business model will likely face threats to their survival in the very near future.”

In the new report, A Reality Check for Today’s C-suite on Industry 4.0 – experimentation is ending, KPMG has identified a false sense of security held at the top levels of many manufacturers. As organizations implement single-project, bottom-up approaches to transformation – from physical plant changes, to integration of big data – the cost efficiencies are cited as proof of i4.0 transformation.

Companies may see their bottom lines increase in the short term, but KPMG has found that individual initiatives are proving to cost more and yield less in the longer term when business has to course correct due to the incredible pace of change experienced by the manufacturing industry.


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