Water 4.0: An Integrated Business Model from an Industry 4.
0 Approach
M. O. Alabi1, A. Telukdarie1, N. Janse van Rensburg2
1
Post Graduate School of Engineering Management, University of Johannesburg, Johannesburg, South Africa
2
Process, Energy & Environmental Technology Station, University of Johannesburg, South Africa
(micalabs@gmail.com, arnesht@uj.ac.za , nickeyjvr@uj.ac.za)
Abstract – Water is one of the most valuable natural
resource used for everyday living. The era of Fourth
Industrial Revolution (4IR); also referred to as Industry 4.0
has brought about different “Smart thinking” such as smart
city, smart mobility, smart manufacturing and smart
factory. In the water industry, the Germany Water
Partnership is championing the Water 4.0 initiative since
2016. The essence of Water 4.0 initiative is to harness the
digital revolution or decentralization of the water industry.
This paper takes a close look at the business side of Water
4.0 from an 4IR perspective and aimed to develop an
“Integrated Business Model” for Water 4.0 revolution. This
paper is expected to answer this research question “can
water industry be regarded as an integrated business?”. This
paper started with a comprehensive literature reviews
around the title of the research and integrated business
model in relation to water industry. The literature reviews
were analyzed and examined, and relevant factors
considered suitable for integrated business model which are
carefully selected for Water 4.0 paradigm.
Keywords – Water 4.0, Water Digitalization, Integrated
Business, Business Model, Industry 4.0.
I. INTRODUCTION
Water is a fundamental valuable natural resource
which provides significant support to people, health,
manufacturing, agriculture, food processing and most
important the growth of national economy [1]. In recent
times, there is an increase in the demand for water supply,
especially in urban cities due to urban sprawl, that is,
extensive increase in population in the city. Globally, the
water industry is being confronted with different
challenges [3]. To address these issues, many water
corporations are aiming towards water digitalization and
integrated water management system.
The advent of Industry 4.0 since 2013 has brought
different “Smart Thinking” initiatives both from the
industry and academia; such initiatives are “Smart
Factory”, “Smart City”, “Smart Water”, “Smart
Manufacturing”, “Smart Logistics” and “Smart
Enterprise”. Recently, the water industry has embraced
the Industry 4.0 revolution which is referred to as Water
4.0 or Smart Water. The Water 4.0 initiative is a Germany
Water Partnership brainchild and aims to transform the
current conventional water systems into 21st century water
infrastructure systems and management [3]. This will
allow the water management systems to be decentralized.
The daily available data set within the water industry with
be utilized effectively and to make informed decision that
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enhances the smooth operation of the water supply and
demand [4].
In summary, Water 4.0 is simply a digital
transformation of the water sector which aims to disrupt
the different aspect of the water industry and make it
more efficient [3][6]. Helmbrecht and Pastor-Justo [5]
describes some of the significant benefits of Water 4.0 in
the era of digital transformation, aside the economic
benefits which are “more efficient water and energy
management; increase water security; greater public
awareness about the environment and the water cycle;
increased service quality and user satisfaction and transfer
of knowledge and improved corporate image” [5].
Most of the current water management systems are
using centralized system. There is a need for the water
industry to transit to digital water management system
(decentralized and data-driven). For a successful water
digitalization, the business aspect of the water industry
transformation needs to be address. The water industry is
regarded as complex systems that requires intensive
planning before the entire water networks can be fully
digitalized or decentralized [3].
Based on literature review, currently, there is no
study that consider Water as an integrated business
model, especially from an Industry 4.0 context, i.e.
bringing together different aspects of the 21 st century
digital technologies suitable for the water digitalization
processes or revolution.
Therefore, Water 4.0 concept needs an “Integrated
Business Model”. To develop a fully integrated business
model that comprises of all the critical factors and
technologies that will lead to the ultimate success of
Water 4.0 revolution. Significantly, this paper is expected
to answer the following research questions:
x What is Water 4.0 paradigms and the current
technologies associated with this revolution?
x Is there an existing Integrated Business Model for
Water 4.0 revolution?
x Can water industry be regarded as an integrated
business?
II. LITERATURE REVIEW
A. Industry 4.0
One of the significant features of Industry 4.0 is the
exponential rapid growth of so-called “Smart Factories”
[6]. The ‘Smart Factories’ initiative is gaining the
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attention of industries, academia, and individual. This
implies that Industry 4.0 allows digitalization across the
whole value chain, embedding digital processes,
optimizing and tracking into every area of the
manufacturing process [6].
Helmbrecht and Pastor-Justo [5] article entitled -
Water 4.0: Towards a New Ecosystem. The article
describes the concept of Industry 4.0 as “an
ecosystem, where the relationships and connections
between different elements in the system become as
important as the independent chain links in the water
cycle”.
B. Water 4.0 Paradigm
Water 4.0 is a recent concept being coined from the
Industry 4.0. It is regarded as the future of water industry;
which is also referred to as “Smart Water” or “Digital
Water” Industry. According to Bufler et al [3] “Water 4.0
puts digitalization and automation at the center of a
strategy for resource-efficient, flexible and competitive
water management. As a result of this, Water 4.0
incorporates the same main features and terms of Industry
4.0, such as ‘networking of machines, processes, storage
systems and resources’, ‘smart grids’, ‘Internet of Things
and Services’, and brings them together in a systemic,
water management context”. Furthermore, Water 4.0
provides a greater level of transparency for water end-
users, and to address the current need of water demand
and creates opportunities for sustainable water
management system in the 21st century [3].
The four stages of Water 4.0 revolution are presented
in Fig. 1. The first water revolution utilized local and ad-
hoc systems, i.e. using steel to handle high water pressure.
The second water revolution used large centralised water
infrastructure [2][3]. The third water revolution utilized
computers and control systems where IT enabled systems
are used to integrate site sensors into the IT infrastructure.
Lastly, the fourth water revolution is using Cyber-
physical enabled systems which combines real and virtual
water systems [2][3].
Fig. 1: The four stages of Water 4.0 revolution. [2]
Based on the literature study, this paper identifies
some Industry 4.0 technologies which are carefully
considered as the current technologies for Water 4.0
paradigm as shown in Fig. 2. Internet of Things is a
promising technology for the Water 4.0, and it allows
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water related issues to be monitor in real-time remotely.
Big Data and Analytics technologies is expected to
transform the water industry to a complete data-driven
sector. Cyber-security technology is considered important
to the water industry and the digital world. This is due to
the persistence cyber-attacks on water industry and the
technology assisting to avoid breach of digital security
[6]. The Cloud platform assisting the water industry to
address their current challenges. This technology is
helping the water industry to store, analyse and visualise
large amount of data collected through sensors and water
pumps [24]. Artificial Intelligence and Machine Learning
are other technologies/techniques being used in the water
industry to create leverage for quality water treatment
process by exposing the water related issues ahead of time
and notify the water field engineer in real-time [4].
Fig. 2. Current Water 4.0 technologies.
Source: Authors’ Own Construction
C. Digitalization in Water Industry
Digitalization can be described as “the pervasive
integration of different digital technologies into a system
with the aim to have a great impact across all the business
verticals as increasing numbers of digital technologies or
innovations are being implemented in business processes”
[6]. The core of digitalization in the water industry is the
general adoption of the connected new digital devices and
applications across the entire aspects of the water
networks, infrastructure and management. The new trend
of digitalization in the water industry is commonly
referred to as the Water 4.0; which is highly characterised
by the increasing digitization and interconnection of
various integrated business processes [6].
Krause et al [7] explains that digitalization of water
will lead to improved water infrastructure, minimal waste
and increase water availability. It is expected that the
economic and social gains of water digitalization will be
exceptional for the business growth, communities and
social well-being of the people. Digitalization of water
sector promises to assist in transforming the water
infrastructure in both emerging and developed economies
or countries [7]. One of the benefits that digitalization will
bring to the developed economies is to assist in upgrading
and improving many centralized water systems and find
solutions to system failures and long-term inefficiencies.
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In emerging economies, digital technologies will allow
the adoption of distributed, decentralized, and off-grid
water treatment and enhances water usage in agriculture,
and general surface and groundwater management [7].
D. Integrated Business Model/Architecture
In this age of Industry 4.0 and Water 4.0, Integrated
Business Model or Architecture primarily centers on
enabling a culture within the business that encourage
continuous improvement and innovation [6]. Doleski [8]
describes “Integrated Business Model as a process that
ensures all factors critical to success are considered in
full, with clearly defined, structured components”.
Furthermore, a successful business model must take into
account the entire organization and how it communicates
with its environment. Only by integrating all relevant
influencing factors and restrictions can a business model
lead to processes and ultimately goods and services that
pass market testing even in a more complex environments
such as the water industry [8]. Smart water management
system or Water 4.0 drives a process of integration and
alignment that allows more unified water infrastructure
and its associated processes. The smart water revolution
or digital solutions is expected to enable water industry to
integrate and manage both their vertical and horizontal
value chains within the water business or operations [6].
E. Horizontal and Vertical Water Integrated Business
Approach
Effective water digitalization will allow the water
industry to adopt new and disruptive business models that
enhances the horizontal cooperation across the water
value chains and foster the integrated application of data
and analytics [6]. The horizontal and vertical integration
business in the context of Water 4.0 will require
interaction between the implemented systems which are
based on highly specialized software and user interface
which are integrated into the digital networks to produce
an entire new platform of systems functionality [9].
x Horizontal Integration: In the water industry,
horizontal integration of business model refers to
as the integration of different Information
Technology (IT) systems across various water
infrastructural networks and business process
planning. This requires an exchange of
information, energy and resources. From a
digital water integrated business approach. The
different systems include Customer Relationship
Management, Supply Chain Management,
Vendor Management, etc. The essence of
horizontal integration for Water 4.0
implementation is to provide a complete end-to-
end value chain [6][9][10].
x Vertical Integration: Vertical integration in
water digitalization context refers to the
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integration of different Information Technology
(IT) systems at varying hierarchical levels within
the organization. This includes the Sensors,
Enterprise Resource Planning, Business
Intelligence, etc. Vertical integration
implementation will provide Water 4.0
revolution a complete, single view of entire
processes and allows a central dashboard that is
applicable for monitoring and controlling of
every aspect of water demand and supply across
the different water networks [6][9][10].
III. RESEARCH METHODOLOGY
The essence of this paper is to develop an integrated
business model for the Water 4.0 revolution with the aim
to connect and integrate all the Industry 4.0 technologies
in relation to water industry. This allows the business
aspect of the water 4.0 to be seen as single entity or
system. The system would be able to work together to
achieve the primary aim of Water 4.0. This research
commences by studying recent literature pertaining to
Industry 4.0, water industry, digital water, business
model/strategy and process in relation to Water 4.0
revolution. The knowledge gained from the extensive
literature reviews were investigated and analyzed. Certain
variables and factors relating Water 4.0 business model
identified and used to develop a fully integrated business
model for the Water 4.0 revolution in this study.
The first step in the construction of the integrated
business model for Water 4.0 was to identify recent 4IR
technologies associated with water industry such as Big
Data, Mobile, Virtual Reality, Cloud, etc. More so, the
second step in methodology involves investigation of
business stack of system within the water 4.0 context, i.e.
the business systems (such as ERP, Manufacturing
System, Business Intelligence, etc.) that will relate to the
identified technologies in the first step. The data analytic
is at the core or center of the business stack; since the
entire systems will generate daily data. This data needs to
be analyzed to assist water industry to make informed
decisions. The third step in the methodology involves
examining the business planning and logistic strategy
(such as Human Resource, Maintenance Management,
etc.) that are relevant to water business. Lastly, for clarity
purposes, the paper does not focus on the implementation
processes/strategies of the integrated business model for
water; rather future study in this area will consider this.
IV. RESULTS AND DISCUSSION
The results of this study yielded the development of a
fully “Integrated Business Model” for Water 4.0 based on
Industry 4.0 paradigms approach. The Integrated Business
Model consists of three aspects: The technologies aspect,
the business stack of the systems and the business strategy
aspect as shown in Fig. 3. The proposed business model is
further illustrated into detail and how these three
components work together in this section. The business
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stack of systems and business strategy components are
regarded as “Water Balance” as shown in Fig. 3.
Fig. 3: Proposed integrated business model for water 4.0 revolution.
Source: Authors’ own construction.
A. The Technologies Component
The technologies component of the Integrated
Business Model for Water 4.0 are technologies within the
Industry 4.0 revolution. These technologies were selected
based on extensive literature review of the recent studies
on Industry 4.0. The essence of these technologies are to
assist the water corporations to connect with the
technologies within the Business Stack of Systems
component. To analyze the data generated using recent
data analytic tools and make accurate decision for both
internal (staff) and external (client) purposes. The water
organizations are not expected to use all the technologies,
but to utilize either one or two technologies that suit their
working environment or system. Table I provides brief
benefits of each of the technology to the water industry
and the relevance in the proposed Integrated Business
Model.
TABLE I
THE BENEFITS AND RELEVANCE OF EACH TECHNOLOGY
COMPONENT TO WATER 4.0 AND THE INTEGRATED BUSINESS MODEL
Technologies Benefits of the Technology in Integrated Business
Component Model for Water 4.0 Revolution
Mobility - Mobile technology is assisting the water industry
in their day-to-day water operations.
- Closely connected with communication and coop-
eration between machines and people at real-time
through wireless network/Internet.
- Data or information can be received and analyzed
and necessary action can be taken in real-time [12].
Virtual - It allows the supply chain, pump station layout,
Reality asset management and owner operators to collabo-
rate in the same virtual environment.
- The problems/defect/health and safety risks can be
identified earlier before the final design, planning,
implementation and operation assets.
- Application of virtual simulators i.e. (3D CAD
Models) or 3D Visualization [13][14].
GPS - An important technology for precision monitoring
and controlling in the water industry.
- Provides accessibility to water networks and to
detect leak or pump damage.
- Identifies insufficient water operation in real time
through different GPS locations [12][13].
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Advanced - It assists the water utilities in solving various water
Analytics challenges such as aging infrastructure, climate
change and urbanization.
- Promoting Water 4.0 paradigm through the use of
advanced analytic techniques such as Machine
learning and Deep Learning.
Big Data - Assists the water utilities to effectively utilize the
data received through different sources such as
Supervisory Control and Data Acquisition System
- Big Data technology can assist the water industry
to gather, monitor and analyse the data in real time.
- Helping the water industry to save cost, identify
issues in due time and support accurate decision
making [15].
Cyber - Cyber-physical systems (CPSs) are defined “as the
Physical combination of physical processes with computa-
Systems tion and networking” [16].
(CPS) - It can be embedded with sensors, actuators and
processors that could senses and communicate with
the water environment.
Water - Water model is a technique used in science to
Models simulate and thermodynamically calculate water
cluster, aqueous solution and liquid water with
explicit solvent [17]
- The advent of 4IR is assisting the water industry
in creating water model using Machine Learning
techniques to make accurate prediction [18].
B. The Business Stack of System Component
This section would assist the water industry to
manage their business system in real-time. It helps to
integrate the system and data generated from the active
systems into a more meaningful insight that will support
decision making processes in the water industry using the
data science best practices. As shown in Fig. 3, Data
analytics is at the center of the “Business Stack of
System” component. This indicates that data is the core
component of business of Industry 4.0 revolution. Table II
provides brief benefits of each of the system in the
business stack of system in relation to water industry and
their relevance in the proposed Integrated Business
Model.
TABLE II
THE BENEFITS AND RELEVANCE OF EACH BUSINESS STACK OF
SYSTEMS TO WATER 4.0 AND THE INTEGRATED BUSINESS MODEL
Business Stack Benefits of the Business Stack of System in
of Systems Integrated Business Model for Water 4.0
component revolution.
ERP - ERP innovative solutions are part of the important
drivers of digital water business of the 4IR.
- Managing structured business data designed
primarily to be used within CPS environment and
decentralized system.
Operational - Monitor the operational management of the water
Networks water distribution networks i.e. maintenance of
the entire networks.
- Assists the water industry to generate data, stored
and analyze that could be used to manage water
infrastructure, locate area of issues and to prevent
future occurrence.
Manufacturing - Perform several activities and operations that can
System be monitored and controlled at different levels of
operation [21].
- Help to deliver quality water supply/services
Through the diverse operational activities in the
water network
- Effective monitoring and controlling of the infor-
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mation generated during different operational
activities and assist in carrying out predictive
maintenance.
Sensor - Used to collect large amount data set since the
technology water sector is generating water data daily.
- Water 4.0 revolution is extensively exploring
sensor technology in different ways, such as leak
detection, pipe and pump damage.
- It has different application areas for the water
industry such as multi-sensor remote sensing,
wireless sensor networks and smart water sensor.
Business - Technology-driven process for analyzing data and
Intelligence presenting actionable information to make
(BI) informed business decisions.
- BI application assist in saving cost, grow the
financial and market base.
- Increase competitiveness and support good
business decisions-making.
Automated - Assist the water industry to deliver relevant
Reporting/ business report or information at specific time
Strategic intervals.
- Automatically fetch data from each system and
integrated the data using automated data analytic
software.
Automated - Provide the computer systems, smart networks
Reporting/ and machines/equipment with the capability to
Operational function without human involvement [22].
- Assist to reduce the complexity of labour
intensive tasks, save time, and cost, increase prec-
ision and accuracy of the current tasks [22].
Data Analytics - Data analytic is at center of the business stack of
system, which implies that, the core aim of the
entire business stack of system is to be data-driven
- Provide the ability to analyze the available data to
support effective running of the system.
C. Business Strategy/Management Component
The Business Strategy/Management” is an important
component of the organization system. Business strategy
is very crucial for the Water 4.0 revolution to achieve the
long-term objectives. Business strategy/management is
the art or science of formulating, implementing and
evaluating cross-functional decisions that allows the
organizations to achieve their desired ends or goals [11].
This will serve as the backbone of decision making for the
water business. The business strategy component is
presented in Table III.
TABLE III
THE BENEFITS AND RELEVANCE OF EACH BUSINESS
STRATEGY/MANAGEMENT COMPONENT TO WATER 4.0 AND THE
INTEGRATED BUSINESS MODEL
Business Benefits of the Business Strategy in Integrated
Strategy/ Business Model for Water 4.0 revolution.
Management
SCM - The digital supply chain management system
(Supply Chain 4.0) will assist the water industry
faster, efficient and accurate in carrying out their
daily operations using 4IR innovations such as
IoT, robotics, etc.
Vendor - A digital-based system that serves as a mechan-
Management ism for the water industry in managing and
optimizing relationship with external suppliers for
projects and business process purposes.
HR and - This system would assist the water industry in
Capacity sourcing for right talents/graduates with sound
Management knowledge of Industry 4.0 technologies.
- Human Resource Management serves as good
business strategy to source for rightful talent with
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4IR.
- The digital HR system assists in training new set
of staff and create a platform to keep the talent
sourced for.
Operations - Digitalized management system that designs and
Management. controls the process of water network operations
- Assist in converting both materials and labour
into good and services effectively.
- Maximize profit for the organization.
Finance/Billing - Involving organizing, controlling, planning,
Management evaluating and monitoring the financial resources
of the company that allows them to achieve the
overall goals.
- Industry 4.0 technologies such as cloud, Big Data
and Analytics, and Blockchain technology will be
useful in this regard.
Maintenance - New maintenance techniques such as - Intelligent
Management Maintenance and Predictive Maintenance System
will assist the water network system.
- Sensor technologies (i.e. series of sensor) can be
integrated into the Computerized Maintenance
Management System (CMMS) to store and
analyze data gathered from the sensors
- Predictive algorithm can be developed to address
the problem identifies via the sensor data [23].
CRM - Assist to manage the organization relationships
and communications with customers and
potential customers.
- 4IR technologies such as cloud, and IoT allows
current customers and potential customers to
interact with the organization.
V. CONCLUSION
This study presents an overview of Water 4.0
revolution and the digitalization of water industry. In this
study, water industry is regarded as an integrated business
environment due to the complexity of the systems.
Therefore, an effective integrated business model is
important in order to achieve the long-term goals of the
Water 4.0 paradigm and its sustainability from a business
perspective. This paper has been able to answer the three
research questions earlier stated. This paper has been able
described Water 4.0 revolution and the associated
technologies. Currently, based on the literature reviews
conducted, there is no existing Integrated Business Model
for Water 4.0, which implies that this paper proposed the
first integrated business model for Water 4.0 revolution.
The proposed model comprises of three components
which are expected to work together to achieve the
overall success of Water 4.0 revolution.
This paper focus on the development of integrated
business model for Water 4.0, and do not address the
implementation processes/strategy. The limitation of this
study is the inability of the authors to physical implement
the proposed integrated business model at a water
site/corporation. Therefore, future research in this area
should propose an effective implementation processes or
strategies for the integrated business model using a water
site. As part of the future study, a pilot study should be
conducted among water industries to identify and measure
their present involvement in water digitalization/Water
4.0.
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ACKNOWLEDGMENT
The research team would like to thank the University of
Johannesburg, Process, Energy and Environmental
Technology Station (PEETS) and the Technology
Innovation Agency of South Africa for supporting this
research.
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