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Implications of the “Industry 4.0” Concept on Management Practice

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  • Yurii Hrinchenko

    (Odesa Mechnikov National University, Ukraine)

Abstract

“Industry 4.0” concept was developed to meet the challenge of technology progress in the field of data processing, artificial intelligence, robotics and cyber-physical systems. This concept changes the production systems to serve efficiently various customer demands. The major obstacles for successful implementation of “Industry 4.0” from a CEO perspective are unclear economic benefits and excessive investments and lack of qualified employees. The readiness to adopt new approaches in engineering, management and education defines national strategies for the forth industrial revolution progress. The new concept of manufacturing builds integrated and customer-oriented supply-chains, so the outputs and inputs go beyond processes boundaries. The radical change in manufacturing design requires a new set of skills for engineers, managers and employees. Management experiences a substantial shift from functional-based to customer-value oriented logic. Meaning of efficiency and effectiveness, scope of planning and control, organizational design for power and task distribution, communication patterns and coordination networks challenges profound changes both in meaning and form. More flexible and complex environment, patterns for instant coordination, priority for autonomous decision-making require new skills and new attitudes for employees and managers to exploit all benefits of “Industry 4.0”.

Suggested Citation

  • Yurii Hrinchenko, 2021. "Implications of the “Industry 4.0” Concept on Management Practice," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 10(1), pages 31-41, April.
    • Handle: RePEc:ods:journl:v:10:y:2021:i:1:p:31-41
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    References listed on IDEAS

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    More about this item

    Keywords

    Industry 4.0; smart factory; digital manufacturing; cyber-physical systems; organizational design; customer-oriented supply chain; efficiency; management paradigm;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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