Exploring the Barriers to Industry 4.0 Technology Adoption among Indian MSMEs: A Literature Review

Abstract

Adoption of the Fourth Industrial Revolution, also known as Industry 4.0, is seen as a key initiative for manufacturing enterprises around the globe since it allows for an efficient and sustainable production eco-system. However, significant studies on Industry 4.0 readiness of Micro, Small, and Medium Enterprises (MSMEs) are unavailable. The phrase "Industry 4.0" is known as the fourth industrial revolution, which is characterized as a new phase of production in which numerous developing technologies intersect to produce digital solutions. Industry 4.0 was first introduced in Germany in 2011. Industry 4.0 includes applications of various new technological innovations in the manufacturing process like the Internet of Things, Industrial Internet, Smart Manufacturing, Cloud-based Manufacturing etc. The implementation of Industry 4.0 is crucial for today's manufacturing enterprises due to various benefits like cost reduction, optimization and customization. Moreover, the enterprises in today's era are shifting from mass production to customized production, which demands a high-cost efficiency and intelligent manufacturing ecosystem. Thus, companies all around the globe are hugely investing in digitalization, automation and intelligentization of machines. However, the adoption level of these technologies in Indian industries is significantly low. In this context, this paper aims to study the Industry 4.0 technologies in detail and assess the various challenges in implementing Industry 4.0 concept in the Indian Micro, Small, and Medium Enterprises (MSME) sector, which includes more than 63 million industries. The study critically evaluates the various Industry assessment models and classifications of Industry 4.0 technologies. Based on the analysis and literature, the study proposes a systematic approach for industries to implement Industry 4.0 technologies. As the topic of the study is, still in the initial stages of development this research takes an exploratory approach and relies on secondary data collected from various government websites, books, journal articles, and websites.