Industry 4.0 transformation: factors affecting adoption and impacts on companies

Abstract

PurposeThe purpose of this paper is to determine the factors that affect Industry 4.0 applications, the expected impacts of Industry 4.0 applications in companies and to analyze the importance of these factors and the importance of expected impacts correlatively.Design/methodology/approachThis paper provides an empirical analysis of the factors affecting the adoption of Industry 4.0 transformation and its impacts on the companies. The paper is based on 103 valid answers to a questionnaire-survey distributed among companies in Turkey. The Pearson correlation analysis was conducted to determine the correlation between independent variables and dependent variables. Regression analyses were used to test the proposed hypotheses. A multiple regression analysis was used to investigate the causal relationship between independent and dependent variables. Linear regression method and stepwise regression method was employed for regression analyses. The factors that influence Industry 4.0 applications were determined as company size, technological level of products, budget allocation for R&D department, level of lean applications, level of agility/flexibility and level of automation; and the expected impacts of Industry 4.0 applications were determined as traceability of production processes, traceability of supply chain, flexibility of supply chains, communication between the partners of supply chain, productivity, real-time data analysis, integration between companies and integration in the company according to the literature reviewFindingsThe results of this research study revealed that, there is a stronger relationship between level of Industry 4.0 transformation and level of automation than there is between Industry 4.0 transformation and the other independent variables. From the analyses conducted, it can be stated that budget allocation for R&D and level of lean applications and level of automation had greater impacts on Industry 4.0 transformation than company size has. The independent variables included in the regression analysis had a positive effect on Industry 4.0 transformation of companies. However the effects of company size, technological level of products and level of agility/flexibility on Industry 4.0 transformation was weak. When the impacts of Industry 4.0 on companies were analyzed, it can be stated that there is a stronger relationship between Industry 4.0 transformation and real-time data analysis, traceability of production processes, integration in companies and productivity than there is between Industry 4.0 transformation and integration between companies, traceability of supply chains, flexibility of supply chains and communication between the partners of supply chain. It was determined that Industry 4.0 transformation generally impacts internal factors of company, while Industry 4.0 had limited impacts on the supply chains.Originality/valueAlthough there are studies that separately investigated the factors affecting Industry 4.0 transformation and the impacts of Industry 4.0 transformation on companies, the present study provides important contributions to the literature in terms of considering the importance levels of the factors affecting Industry 4.0 transformation and the importance level of impacts of Industry 4.0 transformation on companies as a whole and in relation to each other.

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