Business Scenario 2:
Industry 4.0


Industry 4.0 represents a new frontier for the global economy which has the potential to impact many industries and influence the way goods are manufactured, sold, and serviced. It is conceptualised as an integrated business environment where machines, operational processes, and products interact with each other autonomously within and between firms.

The underlying principle of Industry 4.0 is that by autonomously connecting machines, digital processes, and systems; businesses create intelligent networks along the entire supply chain. Industry 4.0 espouses a smart system which adapts and evolves autonomously utilising and integrating human interaction, but not necessarily requiring human management and oversight.


Industry 4.0 and smart systems enhance the ability to adapt and reconfigure supply chains in order to deal with unexpected events or disruptions.

For example, Northrop Grumman highlight their use of smart warehousing to become more nimble and able to adapt and respond (McKeon 2019). Similarly, Werner Enterprises, Inc. touts the use of a smart transportation management system (TMS) with real time capabilities to meet customer needs and changes (Werner 2020).


The downside of smart system must also be considered. Sanders (2019) notes potential weaknesses in smart systems as lacking common sense, intuition and creative problem solving.

So, we have to ask ourselves whether resilience can, in fact, be hampered by both the lack of flexibility and agility and the loss of key human skills?

First Finding

As such, the study provides two key takeaways directly associated with Industry 4.0. The first major finding is that firms have positive experiences implementing and leveraging smart systems with regards to how smart systems could improve supply chain resilience and performance.

The smart systems improved supply chain performance and allowed firms to be better prepared to deal with and recover from unexpected events and dynamic factors in the supply chain.

Second Finding

Secondly interviewees deemed smart processes as capability enhancers which serves to not only improve performance but also improve resilience. Our results empirically validate anecdotes of smart systems allowing humans to focus on aspects of innovation and creativity rather than monitoring, reporting and managing large sets of unwieldy and real time data.


•Industry 4.0 and resilience in the supply chain: a driver of capability enhancement or capabilityloss? ; Peter Ralston & Jennifer Blackhurst

•McKeon, A. 2019. Northrop Grumman newsletter NOW. May 24, 2019.

•Werner Enterprises, Inc. 2020.Website accessed on Jan, 2020.

•Sanders, Nada R. 2019. “The Limits of AI: What Machines Can’t Do.” CEO World Magazine. Online. November 2.