While we are still right in the middle of the Industry 4.0 era, the next phase is already approaching: Industry 5.0. A new phase of the industrial revolution where people (i.e., employees) will play a more central role. But how can you keep up as an entrepreneur? How do I steer my company from 4.0 to 5.0? And as an SME, do I always have to strive for the latest ‘version’?
What are the differences between Industry 4.0 and Industry 5.0?
Before jumping into the facts, let’s first go over the basics. We refer to the current phase of the industrial revolution as Industry 4.0. This phase has a strong focus on automating and digitalising production methods. In the meantime, we can already see the next phase approaching: Industry 5.0. Its focus is mainly on the human factor in production environments. The underlying principle here is that technologies can actually be used to support and reinforce workers rather than replace them. The main differences at a glance:
- Industry 4.0 is based on the interaction between machines and systems, while Industry 5.0 will focus on improving the interaction between humans and machines.
- Industry 4.0 makes use of emerging technologies such as the Internet of Things (IoT), big data and artificial intelligence. In contrast, Industry 5.0 will focus on integrating these technologies with human capabilities, such as augmented reality, wearables, and exoskeletons.
- Industry 4.0 has brought about a significant change in production processes, with automated machines and systems taking over more and more tasks. Industry 5.0, on the other hand, will pursue a new production paradigm that emphasises human involvement and cooperation between humans and machines.
- In Industry 4.0, the focus is on efficiency, productivity and saving costs. In Industry 5.0, the focus will be on creating a healthy work environment and supporting employees in developing their skills and capabilities.
There are new opportunities, especially for you as an SME
That’s all good and fine, you may say to yourself. But surely I won’t see any of the benefits as an SME? The notion that a new phase like this will first be embraced by large companies is an obvious one. But make no mistake. Industry 5.0 will open up tremendous opportunities for SMEs. Through improved collaboration, for example. Technologies such as augmented reality and wearables will be able to help companies better collaborate with employees and suppliers with the aim of increasing productivity and improving efficiency. But it will also allow companies to be more flexible in their production processes. That will help companies respond more easily to shifts in customer demand and adjust production processes to changing conditions.
Another interesting point: big data analysis and IoT will provide better insight into customer needs and how products and services are used. This will mean that offers can be better tailored to customer needs. But perhaps most importantly: it will be possible to create a better working environment. Industry 5.0 will aim to create a healthy work environment where employees can grow and develop. This in turn, can allow SMEs to attract and retain talent while also helping them to become more competitive in the labour market.
Are you ready for Industry 5.0?
In short, Industry 5.0 will present many opportunities for SMEs. By using technologies that focus on human engagement and collaboration, SMEs will actually become much more competitive and increase their productivity. So it’s well worth exploring just what it could mean for your particular situation. That research starts, of course, with a scan of your financial situation. Because transitioning into a new phase will naturally require making some investments.
But how do you go about performing a scan like that?
Joanknecht Integrated Finance is happy to help. From the perspective of people, processes and systems, we can help you take a look at the maturity and ambition of your processes. Where do you stand? Where do you want to go? And what advanced techniques do you want to apply to achieve it? Industry 5.0 offers plenty of new technologies and opportunities.
We are happy to share our knowledge and expertise to help guide you through this change process. It is important for you as a company to choose the technologies that suit you best. This will help the processes within your organisation truly progress. And make them more agile for the future.
Together, we will look ahead to the opportunities that the future holds for you – and your people.
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