Economic Development Corporation of Shasta County Supporting Expansion of Manufacturing in our Community
How Industry 4.0 is Morphing and How Does Blockchain Fit By Tony Giovaniello, President, Shasta EDC

Setting the Stage

There are many components of Industry 4.0, some of which are not yet fully defined, or fully understood. Other components may emerge as technology is continually emerging. These new tools are sure to amplify the prospective results of Smart Manufacturing solutions.

There has been much learning from both the initial sales interactions and actual installations. In the sales cycles, providers of Smart Manufacturing components or integrators of complete 4.0 systems have encountered resistance. Some of the push-back is driven by the fear of disruption of production, loss of revenue or customer dissatisfaction. Others are concerned about not attaining the “expected” ROI. However, one of the biggest areas of resistance has to do with the workforce and the prospective impacts on company culture.

Some of the learning is leading to different ways of approaching the selling activity. Many are using a more inclusive sales approach where there is coaching and support regarding the adoption and integration of these new technologies as tools which support the overall company goals and objectives.

When the sales are eventually made, the most successful deployments are where the technology supports the work efforts of the existing workforce. Quality, productivity, reduced cycle times and safety improvements are the focus, not workforce replacement/reduction.

What’s Included in Today’s Industry 4.0 Solutions

As of today, Industry 4.0, or Smart Manufacturing systems deploy some or all of the following: Internet of Things (IoT), Automation/Robotics, AM (Additive Manufacturing), AI (Artificial Intelligence), and now, AR (Augmented Reality).

The Internet of Things (IoT) is the deployment of sensors of all types that are integrated into the manufacturing process that provide for the collection of data. These devices are referred to as being on the “Edge.” To put this into context, all data collected which may reside and is processed locally, on your premise or on your private network, is referred to as in the “Fog”. Data Transmitted, stored and/or processed over the public networks resides in the “Cloud”. The term “Big Data” is the ability and infrastructure to process, store, analyze, and report on a high number of complex data sets.

These sensors can measure things like movement, heat, pressure, moisture or humidity, and vibration. The information can be collected, stored, and analyzed on a real-time basis or in batches of statistically relevant quantities. The sensors are relatively inexpensive and many of them can be installed without disabling your current capital equipment.

There may be challenges with wiring these devices into your existing networks. There may be considerations related to the cost to store collected information and to process/analyze this data. Determining what is relevant and valuable to collect is critical in managing the ongoing cost. Ensuring that the data collected is actionable seems to be where many that are implementing IoT have landed.

There are other considerations, too. These include the network that is used to transmit the data from the sensor to the storage unit, and then to the system that will perform the analysis. If the data is moved over a private network, there is less concern. The cloud offers many advantages including low-cost storage, low-cost processing power and the ability to pay for only what is consumed. However, the risk in using the cloud comes from putting your data on a public network. In a lawsuit, that data may be subject to subpoena. In addition, in this world where corporate espionage and intellectual property theft are common, this risk is increased.

Automation/Robotics have been around for decades. Automation in high volume production lines in consumer products, pharmaceuticals, and other sections are the norm. Large robots capable of moving heavy sub-assemblies or large final products are also the norm in places such as automotive factories. The difference is that automation is being further enhanced with digital control and analytics. There are many companies offering automation solutions that can support low volume/high mix and/or mass- customization production environments. Robots are now being combined with IoT, so that the sensors are seamlessly integrated. Collaborative robots are working alongside workers and are now being used to perform functions like inspection to eliminate any subjectivity a human might otherwise inject into the process. As an example, cameras available to do visual inspection are now being combined with robots. The combination of these technologies can yield better results than traditional methods.

Additive Manufacturing (AM) applications continue to grow. New materials, device improvements, and cycle time reductions are emerging every day. Some of the most important progress is occurring in improving post-production processes. This includes better surface quality and new varieties in surface texturing. One device uses heat, vapor and pressure to provide improved surfaces in plastic products, in any range from textured to glossy. This device can also add color in the finishing product. In the area of metal additive manufacturing, HP has showcased a device that it will release in 2021 that is a fully integrated 3D Printing device that incorporates the sintering process in the same machine. They have installed a small number in service bureaus to better understand how the machine is performing and identify other opportunities to improve the performance and feature set of the metal printing device. We’ll see more integrated devices in the future making 3D production more affordable.

Artificial Intelligence (AI) applications in the initial installations are focused primarily on “predictive” maintenance. We are starting to see more “predictive” analytics applications emerging. This holds a lot of promise for deriving the most benefit from AI. The “predictive” maintenance applications help to anticipate how and when production equipment will slow or fail. This provides the insight to address these issues before they materialize, thereby ensuring the least amount of disruption and the maximization of up-time. AI in many applications is very much tied to IoT. The information that is collected from IoT devices is only valuable if it is put into context related to the operation, and secondly, if it’s “actionable”, allowing for the creation of value.

As manufacturing equipment continues to evolve in its digital transformation, new sources of data will emerge which will continue to extend the possibilities of producing increasingly improved results from AI. Where it will end no one knows. It appears that there is a never-ending opportunity for uncovering new paths to growth, productivity, quality, and safety.

Augmented Reality (AR) is a sister to “virtual reality.” However, in AR your reality is not replaced, but additional useful information is presented to assist workers in their manufacturing or maintenance tasks. There are two primary vehicles available today to “augment” the workers environment. These are projectors which are mounted in the workspace. Placement of the worker and the material being converted in the process must both be placed in position. The projectors would then present actionable information on the material which would help guide the work in the specific operation. This could include highlighting the order of operation, torque specifications, matching components with places where an operation should occur. The opportunities are endless. If implemented properly this can eliminate or minimize the need to refer to written documents. These tend to slow down the process and add the potential for injury due to shifting focal points. In complex operations or where there are many different options or configurations, this can greatly simplify the operation, improving speed, accuracy, and safety. It is also a great tool for training new people and greatly reducing the learning curve.

Another way of implementing AR is through the use of simple glasses. These are not the same as the dark VR glasses you see people using with their mobile phones. They are more like the Google glasses, which never caught on. Microsoft has an AR product called, Hololens. Work instructions can be made visible on the inside of these glasses. Your visibility of the area remains intact. However, it is augmented with the type of information we discussed above in the projection case.

Use of sensors, cameras, and barcode in the work environment can help to ensure that the workers and the material have the appropriate registration or positioning for the AR to be effective. Feedback can be provided until the proper positions are attained.

These methodologies need to be perfected and there is code to be written. One manufacturer says that if you can create an advanced PowerPoint, you can program in their AR environment.

Rapid Deployment is helping to eliminate the fear, uncertainty and doubt related to Industry 4.0 implementations. There is fear coming from the employees – will this cause my job to be eliminated. Management is afraid of failure from both a financial perspective including not meeting ROI goals, unforeseen costs, and mainly will this delay deliveries to my clients due to complex installations and disruption to the workflow during setup and test. Sometimes, it is better to start simple and get some results. Sensors and cameras are inexpensive today. Many can be easily added to the work environment with minimal disruption. If you collect data on a separate network and system, that eliminates another point of failure. Going for a quick result rather than the maximum potential benefit can offer two advantages. First, it clearly indicates that there is upside when integrating 4.0 solutions into the environment. Secondly, the workforce can get a better understanding of how this new technology works and can improve their company’s performance while supporting their efforts, not replacing them.

Successful Larger Implementations require similar approaches that you’d use in deploying continuous improvement programs such as lean. You need management buy-in, a project owner/leader, subject matter expertise (internal or external), employee engagement, and so forth, However, you also need to explore adjustments/enhancements to your company’s culture. These refinements may include the commitment to these new techniques, but also to your workforce. If new technologies are viewed as a means to replace your workforce, you may be doomed from the start. On the other hand, if your goal is to eliminate repetitive tasks, improve quality and speed, and create a safer workplace, this is a different story. Some 4.0 implementations are using mobile phones so that the workers get an immediate comfort level from working with a device used in their daily lives. Imagine creating a workplace that is highly efficient and uses your people in the best possible ways. They can focus on process improvement and training new employees. These are activities supportive of your growth and can be derived from your new-found efficiencies. Using this approach, your people can clearly see that there is a place with a purpose for everyone in a growth-oriented company which will create new and exciting jobs for its current and new workers.

Blockchain and its value in Industry 4.0 are yet to be fully defined. However, there are some areas in which blockchain provides prospective benefits. Many of us have already heard about applications in financial transactions where trust can be derived from the use of blockchains. Foreign currencies and fiat currency issues are eliminated and there can be a monitored continuum in supply transaction where multiple levels in the supply base are involved. These are all great ways of managing transactions. There are a few other areas where blockchain may add value in Industry 4.0. One of the areas could be where the blockchains include product, assembly, or component identifying information. This could help in quantifying and managing quality problems with a higher level of specificity.

A perfect example of this is in regard to recalls. Many times, recalls are far and wide because the problem could cause harm and the ability to specifically identify products exhibiting the defect cannot be readily identified. With blockchain, all of the information about a product, its sub-assemblies, components, and its distribution path to market can all be included in the blockchain. Obviously, you do not want to burden the blockchain with unnecessary data, but there is a set of data at every step in the supply chain that can greatly reduce the cost and disruption related to recalls in the current environment.

There are three other areas that are even more specific to Industry 4.0 for blockchain applications and benefits. The first one relates to the above scenario but adds the possibility to more readily track necessary management and product information for market that require even more traceability such as healthcare or military products. Blockchains can be constructed with the new information collected by cameras and sensors, more information than could possibly be collected by a human in a short amount of time.

Another potential application is in using the inherent encryption of a blockchain. This could potentially protect some of the data sent over a public network from unauthorized viewing or manipulation. Although potential protections may be provided, these may not eliminate the possibility of your data transmitted over a public network being subpoenaed, and therefore exposed in that way. Digital designs such as those used in AM – 3D Printing create a whole issue around intellectual property management and control. In many ways, some of the designs out there on the public network are available for hackers to confiscate and use at will. Blockchain could help protect the IP of authors of digital designs. A blockchain can be used to manage financial transactions but also control the usage of the digital property. Let’s use the case of a purchase of use of a design for a specific number of products to be produced. Theoretically, a blockchain can be created that can track the amount of products produced to ensure that there is no piracy above the agreed upon and purchased quantity.


As I write about this every year, usually after the MD&M West Trade Show in Anaheim, it is evident that Industry 4.0 is not a specific thing. It is a number of emerging and evolving technologies with endless possibilities. Many of these can work in concert to produce amplified results or work separately to offer incremental operational improvements.

Both large and small companies can benefit from deploying some of these new systems. Smaller companies should not shy aware. There are affordable aspects of Industry 4.0 which can be easily and readily implemented. There is no doubt that the competitive landscape shifts every time one of your competitors adopts a 4.0 enhancement. Don’t get left behind. Don’t embrace the belief that these capabilities are not applicable to your manufacturing business. Start somewhere! Start now….