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What does Industry 4.0 mean for your industrial or manufacturing workforce?

Put simply, ‘Industry 4.0’ means machines communicating with each other. Processes are automated using smart technology, making use of big data and machine learning. Such modernisation can reduce the need for human intervention or allow for advance machine prediction of human involvement.

Examples of Industry 4.0 in action include robotics to manoeuvre inventory or parts through a warehouse or factory, data analytics on manufacturing schedules to predict and better estimate the service requirements of key machines (reducing bottlenecks) and supply chain management through tracking the movement of parts. Such advancements are likely to increase productivity when rolled out correctly.

Put simply, ‘Industry 4.0’ means machines communicating with each other.

Evolving skills

The above examples are specific to industrial and manufacturing processes and clearly some human roles (or jobs, as we would call them) will become automated as a result. This will not necessarily result in a smaller workforce but it will mean that new skills will be required. Employees will need to implement, understand and refine the technology that is performing these functions and, whilst some resource will invariably come from people with greater tech skills, training will be needed for members of traditional production lines to refine their skillset.

The process of people development becomes an ongoing one as employees develop skills in multiple disciplines, and the technology continues to evolve. Investment in training is therefore necessary to ensure the business is ready to supplement the recruitment of specialists (such as software engineers and cybersecurity technicians) with advancing the knowledge of the remaining members of the team.

Embracing change

A fully functioning learning and development team should ensure that the future needs of the business are met through the recruitment of apprentices in specialist areas, formalising their training and work experience programme so that the company can utilise the Apprenticeship Levy to part-fund the training and save on National Insurance contributions.

At the same time, businesses that invest in the technological advancement of their manufacturing processes may qualify for research and development tax credits, further reducing the base cost of embracing change.

Adapting the business will also need investment in capital expenditure. The extension of the Annual Investment Allowance for another year, meaning that the first £1m of capital expenditure in 2021 could attract a Corporation Tax deduction, offers additional opportunity to invest. Further investment in management information systems will allow for better trend analysis and tracking the improvement in margins from embracing these changes.

Would you like to know more?

If you would like to discuss your industrial or manufacturing business’ digital transformation, and what funding or measures there are available to enable this, please get in touch with one of the contacts to the right.