Industry 4.0 in Germany - The Obstacles Regarding Smart Production in the Manufacturing Industry

133 Pages Posted: 15 Aug 2018

See all articles by Eric Frère

Eric Frère

FOM University of Applied Sciences - ESSEN

Alexander Zureck

FOM University of Applied Sciences - ESSEN; Masaryk University - Faculty of Economics and Administration

Katharina Röhrig

FOM University of Applied Sciences - ESSEN

Date Written: July 31, 2018

Abstract

The digital transformation in the manufacturing industry is referred to as Industry 4.0. The concept includes real-time data transfer and networking along the entire value chain and, with this, vertical and horizontal integration as well as end-to-end engineering through cyber-physical systems, sensors, actuators and human-machine interfaces. Seven years after its inception however, Industry 4.0 technologies have thus far been predominantly limited to certain test applications and pilot projects. In light of this, the present study aims to provide a detailed insight into the concept of Industry 4.0 and highlight the main obstacles that hinder its implementation. The study also seeks to answer the question of whether the concept of Industry 4.0 will ever be implemented to its full capacity in the German manufacturing industry. The research design of the present study is divided into a theoretical and empirical investigation. The theoretical part is based on extensive literature research and aims to provide the reader with an introduction to the technical characteristics and requirements of Industry 4.0, and in particular to highlight as many aspects as possible that hampers the implementation in Germany. The following empirical part is based on the analysis of expert interviews. For the investigation n=13 experts were selected based on their reputation and experience in the field of Industry 4.0 technologies. In order to supplement the theoretical results with practical experience, the experts were chosen from industrial associations as well as, in particular, from those occupying leading positions in the manufacturing industry and IT-consulting. The empirical part therefore will focus to identify the main inhibitory factors to implementing Industry 4.0, that are referred to as 'obstacles' in the course of this thesis. The findings of the present study indicate that, principally, two major obstacles hinder the implementation of Industry 4.0. The first major obstacle relates to the high complexity of the concept, a result of the interacting consequences of a lack of standards and interoperability, of security and legal aspects, as well as the lack of employees suitably qualified in the field of informatics. The other major obstacle concerns psychological reservations, which arise from a reluctance to open up company boundaries for the associated real-time data transfer along the entire value chain. The findings further indicate however, that despite these major obstacles, the German manufacturing industry still has a reasonable chance of succeeding with Industry 4.0 implementation over the long term.

Keywords: Industry 4.0, Smart Production, Manufacturing Industry

JEL Classification: L23, L60, M15

Suggested Citation

Frère, Eric and Zureck, Alexander and Röhrig, Katharina, Industry 4.0 in Germany - The Obstacles Regarding Smart Production in the Manufacturing Industry (July 31, 2018). Available at SSRN: https://ssrn.com/abstract=3223765 or http://dx.doi.org/10.2139/ssrn.3223765

Eric Frère

FOM University of Applied Sciences - ESSEN ( email )

Leimkugelstarsse 6
Essen, 45141
Germany

Alexander Zureck

FOM University of Applied Sciences - ESSEN ( email )

Leimkugelstarsse 6
Essen, 45141
Germany

Masaryk University - Faculty of Economics and Administration ( email )

Lipova 41a
Brno, 60200
Czech Republic

Katharina Röhrig (Contact Author)

FOM University of Applied Sciences - ESSEN ( email )

Leimkugelstarsse 6
Essen, 45141
Germany

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