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Artificial Intelligence—The Driving Force of Industry 4.0

Hesham Magd1*, Henry Jonathan2, Shad Ahmad Khan3 and Mohamed El Geddawy4

1Quality Assurance & Accreditation, Faculty of Business and Economics, Muscat, Sultanate of Oman

2Department of Transportation, Logistics, and Safety Management, Faculty of Business and Economics, Muscat, Sultanate of Oman

3College of Business, University of Buraimi, Al-Buraimi, Sultanate of Oman

4Prince Mohammed University, Al Khobar, Kingdom of Saudi Arabia

Abstract

The 21st century reminds the dawn of the 4th industrial revolution (IR), which has brought new frontiers of technology utilization to industries. Industry 4.0 chiefly relays from the 3rd revolution, taking further the application of computer and automation domain to the current century. Industry 4.0 already has shown remarkable success due to the multifaceted specialisms in digitalization and artificial intelligence (AI). However, in the face of rapidly changing technology, the growth of industrialization depends significantly on the progressive involvement of artificial intelligence applications in wide areas of industrial products and processes. AI technology potential contribution to the global economy is $15.7 trillion currently with 2% contribution from the middle east region. The manufacturing sector investment and funding on project gained in USA and China through AI-enabled technologies by automotive and IT sectors leading GDP by 115% accounting to $77.5 billion in 2021. The factors driving the industry 4.0 mainly are competitiveness and innovation, cost reduction, and performance improvement, which led to the use of AI technology applications to industrial sector. AI-enabled applications are explored in automotive, consumer products, industrial manufacturing, telecommunication sectors to enhance product quality, design in the process. Despite the benefits offered by the AI applications to industries, the barriers for effective adoption of industry 4.0 ideology to all sectors is a time-taking process.

Keywords: Technology, organization, manufacturing, industry, sector, application, tools

1.1 Introduction

The current century marks the renaissance of fourth industrial revolution the term that was first introduced by Klaus Schwab in 2016 to denote the future trend of industrial world [1]. The industry 4.0 principles are built upon the developments of third industrial revolution that already has introduced computerization technology to the world. This paved the way to the most prominent applications, such as automation and artificial intelligence, and in addition to digital transformation of process and business operations along the different industrial revolutions [2]. The first industrial revolution marks the advent of mechanization from steam and waterpower during 1750 and 1850, followed by second revolution bringing in electrical power and mass production systems during 1870 to 1914 and third revolution in the 20th century gave entry of computer and electronics into industrial process after 1970.

Currently, the industry 4.0 began during 2014, where it works on conceptualizing the use of innovative technology and advanced digital production together contributing to a sustainable industrial development [3, 4]. According to research studies by UNIDO, industry 4.0 scope has not made full advancement in all sectors as of yet, in Argentina and Brazil claims that 3% to 4% of firms have adopted few applications, while countries like Ghana, Vietnam and Thailand has very much behind in exploiting the benefits of the fourth revolution.

In this viewpoint, this chapter will deal in describing the role of artificial intelligence technology particularly in spearheading the industry 4.0 concept in the context of manufacturing sector globally. In combination, the chapter will likewise attempt to provide a comprehensive account on the factors that are considered contributing to the employment of industry 4.0 across different organizations.

1.2 Methodology

The purpose of the chapter is to provide an overview and in-depth understanding of the factors that are driving the industry 4.0 in the perspective of artificial intelligence technology. To elaborate the details, published literature and reports from previous studies are referred to meet the objectives of the study, and secondary sources of information by visiting different organizational websites were conducted to examine the factors contributing to the industry 4.0. Thorough searches from previously published work by various researchers was conducted to examine the different driving factors for industry 4.0 and were analyzed. Information related to the industry 4.0 technologies, their roles toward manufacturing sector, statistical information on status global economy with artificial intelligence technology were collected from secondary data published in government information portals and global private organizations like price Waterhouse coopers, McKinsey & Company, Deloitte etc. For presenting the findings from the analysis, the authors have maximized the available information published in researchers and details provide in various organizational websites.

1.3 Scope of AI in Global Economy and Industry 4.0

The fourth industrial revolution is fueled from its predecessor industrial phase essentially pushing the trend toward automation and fully integrating the digitalization process in industries, expanding the applicability through some of the significant applications like internet of things (IoT), cyber physical systems, smart factory, cloud computing, cognitive computing, artificial intelligence, etc. Theoretically, the fourth industrial revolution is driven by four key ideologies, enabling interconnection between different technological applications, transparency in information and procurement, technical assistance, and regionalized decisions enabling the industry 4.0 concept a distinctive approach from the third revolution [5].

Artificial intelligence (AI) can be explained as the use of computer programming to mimic human thought and actions to create human-like responses through machine learning, logic, perception, and reasoning. Legendary physicist Stephen Hawking quotes “Success in creating effective AI could be the biggest event in the history of our civilization. Or the worst. We just don’t know. So, we cannot know if we will be infinitely helped by AI, or ignored by it and side-lined, or conceivably destroyed by it.”

Artificial intelligence (AI) obviously is a significant technology among the other technological applications in the industry 4.0 as it principally works on the foundation of computer learning and augmentation pertinent to the entire industry ecosystem. Most importantly, AI technology has tremendous scope for its application in manufacturing industries in the production and design stages enabling reduction in human errors, production efficiency and reduction in losses. Moreover, the use of AI techniques, such as machine learning and deep learning, have substantial contribution toward advancement of global economy as the global race for embedding AI into businesses have already started reaching milestones in some countries, for example 82% of Spanish companies have explored AI technology in their industrial system.

Following the prospective growth in utilizing AI technology, global projection shows the technology has the potential to contribute $15.7 trillion to the economy by 2030 of which middle east expects to claim 2% of the benefits accounting to $320 billion. AI Technologies in the GCC four countries (Bahrain, Kuwait, Oman, and Qatar) is likely to contribute around 8.2% of GDP by 2030, while in comparison to no middle east economies, the share of AI to the GDP is large, 26.1% in China, and 14.5% in North America. Notwithstanding to say, the prospects of AI technology to industries especially in the developing nations is tremendous as the potential for embedding AI in manufacturing and allied sectors is increasing gradually. In addition, in the UAE, KSA, GCC, and Egypt, the annual growth of AI from 2018 to 2030 is expected to be 33.5%, 31.3% 28.8%, and 25.5%, respectively [6].

In developed nations, the importance of AI technology to business achievement shows more promising growth in the UK from 14 % to 45%, United States 11% to 42%, Germany 4% to 32%, Australia 12% to 29% in the next few years [7]. Regional analysis on the investment scenario on AI in Asian markets shows $0.69 billion in 2019 with the global market expected to reach $9.89 billion by 2027, in the UK, investment on AI stands at $1.3 billion; further, there are growth returns expected from the increasing investment on AI north and south America according to Market research report of Fortune Business Insights [8].

1.3.1 Artificial Intelligence—Evolution and Implications

The period from 1950 to 1960 marks the birth and evolution of AI to the world, later in the six decades of its journey, the technology has taken leaps and bounds along with the industrial revolutions [9]. Presently, in the 21st century, AI is certainly the prominent technology for the industry 4.0 and for the future. Global economists also estimate the wide applications AI will be very much instrumental for global expansion in the future, and quite obviously AI will be one of the most preferred technologies to be used by companies by the year 2025 according to the reports by world economic forum [10]. Added to this, COVID-19 pandemic has necessitated remote work and work for home...