INDUSTRY 4.

0
Industry 4.0 has been defined as “A name for the current trend of
automation and data exchange in manufacturing technologies, including
cyber-physical systems, the Internet of things, cloud computing
and cognitive computing and creating the smart factory”.
Industry 4.0 is the digital transformation of manufacturing /production
and related industries and value creation processes.
The goal is to enable autonomous decision-making processes, monitor
assets and processes in real-time, and enable equally real-time
connected value creation networks.
Industry 4.0 is often used interchangeably with the notion of the fourth
industrial revolution. It is characterized by
• even more automation than in the third industrial revolution,
• the bridging of the physical and digital world through cyber-physical
systems, enabled by Industrial IoT,
• a shift from a central industrial control system to one where smart
products define the production steps,
• closed-loop data models (the system whose operation is controlled by its output is
known as a closed-loop control system). and control systems and
• personalization/customization of products.
What is the Fourth Industrial Revolution?
The first industrial revolution came with the advent of
mechanization, steam power and water power.
This was followed by the second industrial revolution,
which revolved around mass production and assembly lines using
electricity.
The third industrial revolution came with electronics, I.T. systems
and automation, which led to the fourth industrial revolution that is
associated with cyber physical systems.
Industry 4.0 applications
Identify opportunities: Industry 4.0 offers the opportunity for
manufacturers to optimize their operations quickly and efficiently by
knowing what needs attention. By using the data from sensors in its
equipment, an African gold mine identified a problem with the oxygen
levels during leaching. Once fixed, they were able to increase their yield
by 3.7%, which saved them $20 million annually.
Optimize logistics and supply chains: A connected supply chain can
adjust and accommodate when new information is presented. If a weather
delay ties up a shipment, a connected system can proactively adjust to that
reality and modify manufacturing priorities.
Autonomous equipment and vehicles: There are shipping yards that are
leveraging autonomous cranes and trucks to streamline operations as they
accept shipping containers from the ships.
Robots: Once only possible for large enterprises with equally large
budgets, robotics are now more affordable and available to organizations
of every size. From picking products at a warehouse to getting them ready
to ship, autonomous robots can quickly and safely support
manufacturers. Robots move goods around Amazon warehouse and also
reduce costs and allow better use of floor space for the online retailer.
Latest Technologies / Trends
Artificial intelligence
AI describes computers that can “think” like humans. They can recognize
complex patterns, process information, draw conclusions, and make
recommendations. AI is used in many ways, from spotting patterns in huge
piles of unstructured data to powering the autocorrect on your phone.
Blockchain
Blockchain is a system of recording information in a way that makes it difficult
or impossible to change, hack, or cheat the system. A blockchain is essentially
a digital ledger of transactions that is duplicated and distributed across the
entire network of computer systems on the blockchain.
Faster computer processing
New computational technologies are making computers smarter. They enable
computers to process vast amounts of data faster than ever before, while the
advent of the cloud has allowed businesses to safely store and access their
information from anywhere with internet access.
Virtual reality and augmented reality
VR offers immersive digital experiences (using a VR headset) that simulate the
real world, while augmented reality (AR) merges the digital and physical
worlds.
Biotechnology
It includes the practice of using microrganisms or components of cells like enzymes, to
generate industrially useful products in sectors such as chemicals, food, textiles and
biofuels. Examples include vaccines, antibiotics.
Robotics
Robotics refers to the design, manufacture, and use of robots for personal and commercial
use. It is yet to see robot assistants in every home, technological advances have made
robots increasingly complex and sophisticated. They are used in fields as wide-ranging as
manufacturing, health and safety, and human assistance.
The Internet of Things
The IoT describes everyday items — from medical wearables that monitor users’ physical
condition, to cars and tracking devices inserted into parcels — connected to the internet
and identifiable by other devices. A big plus for businesses is that they can collect customer
data from constantly connected products, allowing them to better gauge how customers use
products and tailor marketing campaigns accordingly.
A thing in the internet of things can be a person with a heart monitor implant, a farm
animal with a biochip transponder, an automobile that has built-in sensors to alert the driver
when tire pressure is low or any other natural or man-made object that can be assigned an
Internet Protocol (IP) address and is able to transfer data over a network.
3D printing
3D printing allows manufacturing businesses to print or build their own parts, with less
tooling, at a lower cost, and faster than traditional processes. Plus, designs can be
customized to ensure a perfect fit.
DIFFERENT FACTORS
DRIVING CHANGE IN
INTERNATIONAL
BUSINESS
MANAGEMENT
Political Factors
• Tariffs
Tariffs are taxes imposed. Taxes may be levied as a fixed charge, and are
calculated as a percentage of the value. Many governments still charge ad valorem
tariffs (tax which is based on selling price or other specified value of the
goods/articles) as a way to regulate imports and raise revenues.
• Subsidies
A subsidy is a form of government payment to a producer. Types of subsidies
include tax breaks or low-interest loans both of which are common. Subsidies can
also be cash grants and government-equity participation, which are less common
because they require a direct use of government resources.
• Import quotas and VER
Import quotas and voluntary export restraints (VER) are two strategies to limit
the amount of imports into a country. The importing government directs import
quotas, while VER are imposed at the discretion of the exporting nation in
conjunction with the importing one.
• Currency controls
Exchange controls are government-imposed limitations on the purchase and/or
sale of currencies. These controls allow countries to better stabilize their
economies by limiting in-flows and out-flows of currency, which can create
exchange rate volatility.
• Local content requirements
Many countries continue to require that a certain percentage of a product
or an item be manufactured or “assembled” locally. Some countries specify
that a local firm must be used as the domestic partner to conduct business.
• Antidumping rules
Dumping occurs when a company sells product below market price often
in order to win market share and weaken a competitor.
• Export financing
Governments provide financing to domestic companies to promote
exports.
• Free-trade zone
Many countries designate certain geographic areas as free-trade zones.
These areas enjoy reduced tariffs, taxes, customs, procedures, or
restrictions in an effort to promote trade with other countries.
• Administrative policies
These are the bureaucratic policies and procedures governments may use
to deter imports by making entry or operations more difficult and time
consuming.
Economic Factors
• Interest Rate
Interest Rate is a major factor affects the liquidity of cash in the economy. A
higher return on investment will attract investors. But if the interest rate on loan
increase, cash flow in country decrease and result in a decrease in liquidity of
country. So, the interest rate affects the economy.
• Inflation
With the increase in demand, price of goods or service increase which results in
inflation and with inflation money supply in the market increases.
• Labor
Labor and it is cost or wage is always an important economic factor that affects
the economy. Many countries have started outsourcing of labor from other
countries. The company starts its plant or production where labor is cheap.
• Demand / Supply
Demand or supply of goods or services affects the economy as with the increase
in demand, price of goods or service increase which results in inflation and with
inflation money supply in economy increases and with increases in the supply of
goods or services price of the same decreases. Demand and supply are depended
on each other.
• Natural Resources
Natural resources available like a tree, water, soil, oil, coal, metal, etc.
affect the growth of the country as if resources are available in-
country one will not to pay for its export and existing resources will
help in job creation and increase in wealth of country which will
increase overall economy.
• Power and Energy Resources
Power and energy resources are the main resources required for the
functioning of industry, company, and country. Resources can be
man-made like biogas and natural resources like petrol, coal, gas, etc.
These powers are required for the development of the country and
hence will affect the economy and develop it.
 SOCIO –
CULTURAL
FACTORS
Language
The importance of language differences cannot be ignored. Languages spoken in
a country have an impact on marketing, brand names, the collection of
information through surveys & interviews and advertising. For example, Canada
has two official languages labels must be in both English and French.

Colors
Colors also have different meanings in different cultures. For example, In Japan,
black and white are colors of mourning and should not be used on a product’s
package.

Religion
Religion is a major cultural influencer that can affect many aspects of life,
including the role of women in society, rules about food and beverage
consumption, clothing habits and holiday activities.

Ethics and values

These can have an impact on international business, especially when conducted
from within another country. However, it is important for researchers to
remember that the same ethics and values are not held by everyone in a target
market. They are always dependent on status, region, ethnicity and religion.
Education
The typical level of completed education in a region can indicate the quality of a
potential work force and the status of consumers.

Cultural preferences
Each international market will have varying preferences for products, foods,
product/food quality levels, and even brands. The meaning of shapes, colours and
iconic features can also have different cultural significance. For example, Fanta
soda is orange flavoured for the North American market. However, the Coca-Cola
company, which produces Fanta, has adapted the flavouring for certain markets to
take cultural taste preferences into account. Fanta is peach flavoured in Botswana,
tastes of passion fruit in France and is flavoured to taste like flowers in Japan.

Material culture
This includes the technological goods used by the majority of the population,
personal transport (including car ownership) and the availability of resources such
as electricity, natural gas, telephone, Internet and wireless communication.
TECHNOLOGICAL
FACTORS
Automation
The automation of many unskilled tasks can allow companies to replace human
production lines with entirely machine ones. This can reduce costs for
manufacturers, distributors, supermarkets, and many other different businesses.

Internet connectivity
It’s undoubtable that in recent years global internet connectivity has been on
the rise. This presents an even larger market for many companies who use the
internet to connect with their customers.

Technological factors include production techniques, information and

communication resources, production, logistics, marketing, and e-commerce
technologies.
Changing Era of
Globalization
The Next Era of Globalization Will Be Shaped by Customers,
Technology, and Value Chains
Geography of global demand has radically changed over the past decade. China,
India, and other emerging economies originally plugged into global value chains
by making labor-intensive manufactured goods and exporting them to advanced
economies are now finding their billion new consumers as a powerful force. It’s
an outdated assumption to think of them as “low-cost factories to the world.”
They are lucrative consumer markets in their own right, and their companies are a
new source of competition. The developing world’s share of global consumption
has risen by roughly 50% over the past decade. Collectively, emerging economies
will likely consume almost two-thirds of the world’s manufactured goods by
2025, with products such as cars, building products, and machinery leading the
way. In knowledge-intensive services, including IT services, financial services,
and business services, 45% of all exports from advanced economies already go to
the developing world. While local demand is rising, emerging economies are also
reaching a new level of industrial maturity. They are building out domestic supply
chains and importing fewer of the intermediate inputs they need to keep their
factories running. China, in particular, is modernizing multiple industries and
developing its capabilities in design, engineering, and high-tech manufacturing.
Industry value chains are also making use of digital platforms and logistics
applications, to reduce the costs, delays, and frictions of trade. Ultrafast 5G
networks will provide a backbone for the IoT, autonomous vehicles, and virtual
reality to realize more of their potential.
Now a days multinationals have new technologies that reduce the importance of
labor costs. Deciding factors like where to locate operations and where to invest in
new capacity is changing, particularly in light of new automation technologies.
Trade intensity (that is, the share of global output that is sold across borders) is
dropping as more of what gets made is consumed locally. Factors such as
proximity to customers, the quality of infrastructure, and the availability of a more
highly skilled workforce are assuming greater weight than the drive to find the
lowest possible global labor costs.
Service flows are also growing 60% faster than trade in goods. Technology is
making it viable to deliver services such as industrial maintenance and
telemedicine remotely. Across multiple value chains (including manufacturing),
more value is coming from services, whether software, design, intellectual
property, distribution, marketing, or after-sales services. Companies in every
industry are adding new service lines or experimenting with subscription and
“goods-as-a-service” business models.
Now is a moment to re-evaluate where to compete along the value chain and where
to operate around the globe in the future.
 Changing nature
of
Regulatory Environment
India’s regulatory state has grown in the context of international
standard-setting. International regulatory standards have become
instruments of governance, and most standards come from non-market
private bodies, often international nongovernmental organizations that
have the backing of governments. Prominent examples are the
International Organization for Standardization (ISO) and the
International Electrotechnical Commission (IEC), which jointly
account for about 80 per cent of all international product standards.
Global standard-setting has emerged in the context of the Agreement
on Technical Barriers to Trade, that obliges all WTO member states to
use international standards as the technical basis of domestic laws and
regulations whenever international standards exist. A prominent
example is India’s airline industry, which expanded rapidly, but raised
major safety concerns after a 2012 audit by the International Civil
Aviation Organization (ICAO). This led to the Indian rules
being aligned to the ICAO’s norms, and thus external pressure forced
changes that the Indian regulator was either unwilling or unable to do
on its own accord.
Regulatory environment in Covid 19 crisis
International regulatory framework is fundamental to ensure countries achieve an
adequate regulatory response to this global crisis, and ensure resilience of their
regulations for the longer term. Regulations are adopted by each country following their
national processes. However, given the global nature of the current crisis, the potential
impact of the regulations designed to address it will have a global reach.
Regulatory framework promotes work sharing, mutual learning and pooling of
resources between governments.
1. Dialogue between regulators and exchange of information.
Facing the COVID-19 crisis, countries have promoted and accelerated exchange of data
and information on different fronts. Typically, regulators can agree with their peers
(bilaterally or internationally) by gathering in conferences, or other settings to exchange
information and experiences on regulatory issues, and help each other in the
development of measures.
2. Exchange of scientific information can anticipate and build the ground for
subsequent regulatory co-operation to enable the development and wide
availability of COVID-19 diagnostic kits, therapeutics and vaccines.
The review and approval of diagnostic kits, treatments and vaccines take place at a
national level. Co-ordination can include agreements to use standardised protocols, fast-
track procedures to clear treatments, tests and vaccines; and expedite regulatory
approval pathways for new diagnostic and immunity tests. The EU Guidelines on
COVID-19 in vitro diagnostic tests are a good example of this approach (European
Commission, 2020).
Regulatory co-operation to make a new vaccine available can also involve further
transparency and sharing of information on intellectual property rights in order to
foster innovation and enable equal access to the vaccine.
3. Regulators pool together their experience and expertise to reduce the risk of
regulatory failure and promote good regulation.
As countries face outbreaks, shared information analyses the effectiveness of
containment and mitigation measures, implementation and enforcement,
compliance data, and communications strategies, to name a few.
4. Sharing of experiences can prove especially useful to adopt and review
emergency regulations.
Many governments have passed special regulations in reaction to the crisis
following normal rulemaking processes or through fast-track procedures enabled by
emergency laws. A number of these regulatory efforts lift, adjust or simplify
existing rules and technical regulations dealing with medical products and
disinfectants.
5. Pooling of expertise and intelligence sharing can also help countries as they
adapt their usual regulatory activities to unprecedented conditions.
Governments have reorganised rulemaking and regulatory delivery across policy
areas. They have modified compliance requirements to allow business adjust and/or
prioritise crisis-related activities; adapted a number of administrative procedures as
well as inspections activities to account for new health and safety measures; and
rolled out communication strategies to guide consumers and industry in
Natural Business
Environment
Climate can have an impact on business that goes well beyond. Heating and cooling
have costs attached, but extremes of heat or cold can directly affect operations. At 40
below on a morning, vehicles may not start and any employees working outside will
need protective clothing and frequent breaks. When the heat and humidity rise to high
enough levels, crews face potentially fatal heatstroke unless cooling is provided and lots
of opportunity for hydration.
Bakeries and cake decorators throughout the South do battle every day with the heat and
humidity, which play havoc with icing and decorations. Warm climates speed the
deterioration of everything from perishable items to wooden homes, while the freezing
cycles of more northerly climes make business operations even more difficult. These are
mostly minor annoyances, but they're all things needed to be planned around and
allowed for.
Severe floods in Australia in 2010-11, for example, resulted in more than US$350
million in claims to re-insurer Munich Re, which contributed to a 38 per cent quarterly
drop in profit for the company. The same period of extreme weather in Australia
contributed to a loss of US$245 million in earnings by mining group Rio Tinto. Rising
temperatures are challenging the future viability of tourism businesses. A study states
that fewer than half of the ski resorts operating in the US northeast are likely to remain
economically viable in 30 years, if average winter temperatures increase between 2.5°
and 4°F. Water scarcity remains a critical challenge for all sectors of business.
Companies in the tourism, chemicals and other sectors could face increased operational
costs. In South Africa, platinum mines in the Olifants River system are expected to face
water charges ten times their current value by 2030 due to water scarcity.
Factors affecting
Decisions
Providing Raw Materials
One obvious way the environment affects business is by providing raw materials. If you
plan to operate a quarry, you'll want access to suitable quantities of stone. Mining and
extractive industries usually set up near the raw materials they'll need to mine or drill.
Sawmills locate themselves in wooded areas, and canneries set up where there are either
fisheries or agricultural operations to fill the cans.
Access to Waterways
It provides an additional way to bring raw materials in and ship finished product out. For
companies that manufacture really large assemblies, such as turbines for generating
stations, shipping by water may be the only really effective way to move such a big
product.
Air-Quality Issues
If you're in an area that's prone to air quality problems, you may need to invest in an air
purification system for your offices and production facilities, and expect some of your
employees to be susceptible to illness on especially bad days. If you're a manufacturer,
you may face additional emissions testing and close regulation by local authorities.
Environmentally Driven Regulatory Factors
These might include limits or restrictions on the fuels you burn or the emissions from
your stacks, tight regulations on what you can discharge into the local waterways or
land-based holding ponds, or even special taxes or levies that go to environmental
oversight and protection. In a worst-case scenario, if it turns out that you haven't been
meeting local environmental standards, you might face fines or have to pay for a costly
remediation, or both.
How climate change affects some business sectors
Chemicals
Chemical production is often water intensive. Consequently, the sector will face increasing
pressure to be more water-efficient, and to better manage emissions of chemical waste, as
well as products linked to water-saving technologies, such as purification and desalination.

Power
By 2035, global electricity demand could be over 70 percent higher than 2009 levels. Power
companies will need to harden, or relocate, infrastructure vulnerable to extreme weather, and
better prepare for supply interruptions.
Coal’s global share of total power generation is expected to decrease from two-fifths to one
third by 2035, while renewables are set to increase from 20 to 31 per cent. The
‘decarbonisation’ of electricity will present opportunities for the sector to advance renewable
energy technologies.

Food and Beverage

Growing zones for food crops will shift as local climates change. Marine fish stocks are
increasingly overexploited or depleted, which provide nursery grounds for some
commercially important fish species.
New markets are set to open up for more climate-resilient food varieties. Markets for organic
food and beverages expanded on average by 10 to 20 per cent per year during parts of the
last decade. Companies certified as sustainable food producers can also tap into growing
customer demand.
 Healthcare
Approximately one quarter of the global disease burden can be attributed to
environmental factors. Demand for healthcare services could rise further, especially due
to conditions linked to air pollution, and water-borne diseases.

Tourism
Extreme weather events, impacts of climate change, water scarcity, and declining
biodiversity can make particular destinations more or less attractive to consumers, thus
impacting market demand for businesses operating in these locations.
Overall, tourism demand is set to grow globally, especially the market for nature-based
tourism and eco-tourism – for which customers are often willing to pay more.

Transport
Increasing extreme weather and water scarcity could disrupt supply chains and
infrastructure more frequently. Regulations in many countries to reduce greenhouse gas
emissions, can increase costs, shift consumer demand, and influence product design.
Such regulations will grow more restrictive and widespread as climate concerns
increase. Complying with regulations to reduce levels of air pollution from vehicles
could also add to operational costs.
At the same time, governments are introducing regulations and incentives to stimulate
demand for cleaner transportation options. Businesses in the sector can take advantage
of new and expanded markets for low-carbon and fuel-efficient technologies.
New Age Ethics
Business ethics or Corporate ethics is a form of professional ethics or applied ethics which
deals with the problems of moral nature in a business environment. It applies to the
conduct of an individual, the entire organization and all aspects of business conduct.
These ethics may originate from an individual, organizational statements, or the legal
system. Business ethics is the study of appropriate business policies and practices
regarding potentially controversial subjects like corporate governance, insider trading,
discrimination, bribery, fraud, false advertising and Corporate social responsibility. It
ensures that there is a basic trust between consumers and various forms of market
participants with businesses.
Digital ethics is the moral management of the human implications of digital development.
Machines can be trained based on specific data to generate specific patterns and
diagnoses. Therefore, it is crucial for companies to adopt a data-first approach in order to
avoid negative effects on their business, their products and their employees.
Data ethics is important for governments, businesses and individuals. The technological
impact on the way information is collected and distributed challenges ethics. Technology
affects the details that need to be understood in order to be ethical. Digital technology
presents journalists, media professionals and professional citizens with a host of delicate
data that troubles ethics.
In Canada, the advancement of AI technology and its use in the public service sparked a
debate about data ethics. WikiLeaks’s transparency of public records has changed the
public’s understanding of government, the military, and large corporations around the
world.
Digital ethics, in particular data ethics, has become a topic of discussion across the
globe. The EU General Data Protection Regulation (GDPR) and the US CLOUD Act
are two examples.
Ethical Issues
An issue in a business environment may refer to a situation where the evaluation of
the morality of certain actions is deemed necessary. Some ethical issues of concern in
the modern business markets include honesty, integrity, professional behaviour,
harassment, and fraud. Ethical issues associated with honesty are widespread and
include the misuse of company time or resources, lying with malicious intent, and
bribery. Sacrificing honesty for gains and rewards harms organizational goals in the
long run.

Law and Regulation

Certain ethical values are bound by laws. Often, businesses are not bound by any
ethical guidelines except those provided by the law. In such cases, corporations try to
make a profit by adhering to the framework of the legal system and nothing more.

Internal Policies
Many companies have formulated internal policies about the ethical conduct of
employees which go above and beyond the normal legal framework to which they
have to adhere to. These guidelines can be highly generalized (corporate ethics
statement) or can be highly detailed (corporate ethics code).
 Digital
Transformation
Digital transformation is the process of using digital technologies to create
new — or modify existing — business processes, culture, and customer
experiences to meet changing business and market requirements. This
reimagining of business in the digital age is digital transformation.
It transcends traditional roles like sales, marketing, and customer service.
Instead, digital transformation begins and ends with how you think about, and
engage with, customers. As we move from paper to spreadsheets to smart
applications for managing our business, we have the chance to reimagine how
we do business — how we engage our customers — with digital technology
on our side.
Although digital transformation will vary widely based on organization's
specific challenges and demands, there are a few constants and common
frameworks that all business and technology leaders should consider as they
embark on digital transformation.
These digital transformation elements are:
Customer experience
Operational agility
Culture and leadership
Workforce enablement
Digital technology integration
This decade will still see the rapid scaling of digital initiatives across
industries. In many areas organizations have prepared themselves
for change but haven't made the full leap to transform their culture
to fully embrace the change.
Eight key digital transformation trends that business and IT leaders
should be aware of includes:
• Rapid adoption of digital operating models, including integrated
cross-functional teams.
• A shakeout as those that have invested in big data governance and
analytics bounce their competitors.
• Better use of AI and machine learning.
• Continued merger and acquisition activity in the IT outsourcing
industry.
• Consultancies forming new digital partnerships.
• Expanding public cloud adoption.
• New digital transformation success metrics.
• More attention to long-term value of digital initiatives.