Industry 4.0 in Emerging Economies: Technological and Societal Challenges for Sustainability

Introduction

Industry 4.0 (IR 4.0) has congregated massive attention from nations as well as organizations as a network of technologies for economic development within the past five years. Industry 4.0 offers information and communication technologies (ICT) and digital manufacturing technologies which enhance the operational processes of enterprises swiftly and efficiently. IR 4.0 has shaped a trend of information exchange among various networks, (including Cyber-Physical Systems (CPS), the Internet of Things (IoT), Cloud Computing, Cognitive Computing, and so on). The fourth revolution in manufacturing techniques following mechanization, and electronics; and non-manufacturing techniques following communication, security, has been widely publicized by myriad companies with an aim to combine automation and robotization with human expertise. Manufacturing dependent countries producing a variety of products/services for their economic development can leverage the most from Industry 4.0 (Arifiani & Arifiani, 2019). Emerging technologies, such as AI, connected machines, 3D printing, etc. provide a cost-effective, qualitative and flexible solutions to manufacturing industries. Additionally, the exponential level of connected networks and devices in IR 4.0, resulting in faster automation of processes can disruptively affect the development of wealth as well as the economy in emerging nations. In line with these statements, we can see that IR 4.0 can provide a solid competitive edge for organizations that create innovative business models enabled by advanced technologies. Certainly, we can say that the implementation of IR 4.0 technologies enhances or benefits the organization. However, the big question is - how is the IR 4.0 enhancing competitiveness in emerging economies?

A number of developing countries are struggling with a lot of issues viz., electricity, infrastructure, and government policy & legal system, etc. Even a few developing countries are not enough capable to successfully implement Industry 3.0 or they are not ready yet for introducing new paradigms for ensuring reliability and safety (Martinetti et al., 2017; Martinetti et al. 2018). Developing countries have the potential to get benefit from industry 4.0, but the issue is that “sustainability” in the long-term. According to Merlino et al. (2015), the latest technology is not enough but the organizations need the business model to go with it. Emerging economies can be explained to fulfill two criteria; first, increasing the development of the economy, and second, liberal government policies for the free-market system (Kumar et al., 2017). There are five major characteristics of the emerging market i.e. “business heterogeneity, sociopolitical governance, unbranded competition, a chronic shortage of resources, and inadequate infrastructure” (Verma et al., 2017). One of the important factors that help drive emerging economies is industrialization.

The importance of sustainability concepts has been rising both at the local and global levels. The extreme implementation of IR 4.0 in terms of automation and connectivity has huge potential to affect economic development, but it is still a long way for emerging economies to exploit completely the benefits of IR 4.0. Gibbons (2009) addresses the three sustainability issues – the economic, social and environmental impact on firms in emerging economies. When we try to implement any kind of strategy, process, technologies, etc. in emerging countries then we should focus on these issues.

The primary aim of this chapter is to recapitulate and evaluate the literature concerning sustainability issues of industry 4.0 in emerging economies. In the following sections, we present the above-mentioned concerns in a more systematic view based on the sustainability of Industry 4.0. The most important sustainability issues are technological and societal issues.

This chapter is further structured as follows: Section 2 provides detailed literature about the current development of emerging economies. This section also highlights the outline of industry 4.0 origins, principles and technologies, as well as its relationship with the organization and developing & advanced economies. In section 3, we discuss the sustainability factors and sustainability issues of industry 4.0 in developing countries. In section 4, we provide the discussion and conclusion with major findings that appeared from the literature and indicate directions for future research.