Industry 4.0

There is a lot of buzz around “Industry 4.0,” “The Fourth Industrial Revolution,” and “smart factories.” Much of it is great, so, before we get started, please take less than 5 minutes to watch this excellent video from Bosch.

Even if you don’t watch the video, I will briefly note the points in it that are relevant to this article (but, seriously, watch the video).

  • People are at the center.
  • This will not change.
  • People want more choices.
  • People want more personalization.

In response to those perceptions about people and their needs, Industry 4.0:

  • can adapt quickly in a changing world.
  • provides connectivity across companies.
  • utilizes data mobility and virtual design.
  • listens to preferences to define how the factory will be assembled
  • is composed of modular production units which are autonomous but also trainable.
  • monitors the entire value chain in the “Internet of Things” (IoT) cloud.

In other “Industry 4.0,” “The Fourth Industrial Revolution,” and “smart factories” resources, we find similar revelations. The Internet of Things will be self-describing; value-chains will auto-update, and networks of sensors will enable production systems to be aware of themselves and their components at all times.

Why Industry 4.0 Matters

So, if the promise of Industry 4.0 is legitimate, then we should end up with happier people because of better matching between their preferences and their consumption options. This is certainly not terrible, but it doesn’t really address the questions surrounding:

  • too much production
  • too many people
  • too many choices

My belief is that the reason for this oversight, apparent in much of the Industry 4.0 material, is that all of it originates from and is produced within an outmoded economic context. In other words, it attempts to fit all of these amazing new changes into an old economic paradigm rather than ask how these new technologies and connectivity resonate with, and in fact drive, a new economic paradigm.

In other words, the real revolutionary potential for Industry 4.0 is not that can improve efficiency in the old paradigm, but that it can do something radically new.

I believe that Industry 4.0 can (and should) play a key role in solving the economic crises of late capitalism, and in turn, solve climate change, pollution, poverty, and inequality, by changing economics at its base.

Here’s how.

The Economics of Over-Production and Demand

First, a quick flashback:

  1. The Economy is driven by a production-to-consumption feedback loop, called supply and demand.
  2. The Market is where consumers exercise their preferences to provide the feedback that producers need.

While there is not enough room here to expound all of the features of the 20th century global economy, there are a few of relevance. Notably, the economy exists in a state of perpetual overproduction. This overproduction exists and is supported and stimulated for a variety of systemic reasons, but reason that is useful here concerns the relation between consumer choice and options as noted in the above video.
Specifically, if consumers want choices then a key way for producers to provide those choices is to produce many variations of a particular product or product type. This means making cars of every color because the market does not know what color a particular consumer will want. It means making an endless variety of media, games, and entertainment, because the market does not know what the audience desires. (Much of the activity in 20th century economics has revolved around the problem of anticipating consumer demand and preferences.) This production/consumption ambiguity generates 2 different kinds of waste:

  1. Waste that is generated during overproduction processes themselves (pollution, labor, etc.), and
  2. Waste that is generated from all of the already produced things that go unconsumed (food, media, etc.).

The consequence of all of this ambiguity about consumer demand and preferences is overproduction in advance. And a key consequence of that overproduction is that it creates a necessity to artificially stimulate overconsumption in return. Furthermore, overproduction

  1. consumes more resources than appropriate, generating intolerable strains on our environmental wealth, and
  2. produces more waste than appropriate, generating pollution, climate change, and other global impacts.

This cycle is a vicious downward spiral, and everyone knows it, but the economic and political conversations that we see in the world are all still about how to “stimulate consumption” to “foster economic growth” and to “boost production.” This is backwards.

Make. Less. More

Meanwhile, the solution to the spiraling runaway 20th century economy is not “more more more” but “less less less.” More to the point, as my colleague Richard Adler and I agreed, we need to “Make. Less. More.”

We need to make things ourselves; we need to make less of it by making the right things; and we need to get more out of what we do make by connecting things together into shared commons.

There are two particular factors in Industry 4.0 (and in the video) that point us in the right direction.

  1. The factory is composed of many smaller autonomous, trainable, production modules, and
  2. The information layer is in the cloud. Global, accessible.

In other words, because of the information layer is accessible from the noosphere, the actual factory modules do not have to all be in the same place. Instead, clusters of modules involved in comprehensive sub-processes, can (in general) be spread globally, closer to their resource inputs and/or closer to where their outputs will be needed next. This doesn’t have to be just information either because physical machines occupy an “ambient commons.” So, for example, heat from one set of processes can be used to benefit elsewhere in the system. The change is learning to think ecologically.
Industry 4.0 points out the potential that we have to connect networks of smaller makers into a global web that shares information. (I have written about this global maker web in Pioneering The Thing Commons). Consequently, by capturing and resolving the ambiguity of consumer demand and preferences into a data infrastructure that is inherently portable, we can transform the what/when/where in order to make:

  1. what is needed: via consumer customization which is simply the expression of consumer demand and preferences in advance, and
  2. when it is needed: via on-demand production and modular flexible production
  3. where it is needed: via open source peer-to-peer connections that deliver production design specifications to local production devices

The resulting economic circle of “Make. Less. More.” means less production, less consumption of resources, less waste, etc. because we create to demand on demand and at demand. This is a virtuous circle, not a downward spiral.

Industry 4.0 and the principle of “Make. Less. More.” lets us create 1) to demand (what), 2) on demand (when), and 3) at demand (where).

(This is much like putting a solar panel on a street lamp, but that exploration will have to wait for my article on The Energy Commons…)

To engage with the original please go to Make. Less. More. — Why Adaptive Production Can Save The Planet by Paul B. Hartzog

Lead image: screenshot from “Future production with Industry 4.0” from Bosch Global (see below)

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