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Industry 4.0 Implementation Challenges and

Opportunities: A Managerial Perspective
Bojana Bajic , Aleksandar Rikalovic , Nikola Suzic , and Vincenzo Piuri , Fellow, IEEE

Abstract—Industry 4.0 is a concept aimed at achieving the discussion by industry and academia in the field of management
integration of physical parts of the manufacturing process (i.e., and engineering [1], [2]. Simply looking at the number of scien-
complex machinery, various devices, and sensors) and cyber parts
tific papers dealing with Industry 4.0, it can be seen that the total
(i.e., advanced software) via networks and driven by Industry 4.0
technology categories used for prediction, control, maintenance, number of publications is growing at a high rate. Specifically,
and integration of manufacturing processes. Industry 4.0, which when searching the Scopus database with “industr∗ 4.0” in the
is expected to have a great impact on manufacturing systems in title, abstract, or keywords, there were 5986 publications in the
the future, is attracting attention in both industry and academia. period from 2012 to 2018, with almost 39% of them published
Although academic research on Industry 4.0 is growing exponen- in 2018.
tially, evidence of Industry 4.0 implementation in practice is still
scarce. Moreover, the challenges industry faces when implementing Historically, before Industry 4.0, the first three industrial rev-
the Industry 4.0 concept seem to be even less addressed. At the start olutions lasted nearly 200 years. The first industrial revolution,
of the present survey, a preliminary literature review identified a which took place at the end of the seventeenth century, was
lack of comprehensive analysis of the Industry 4.0 implementation driven by the emergence of steam engines, water forces, and
challenges. Thus, the purpose of the present article is to provide an mechanization. The second industrial revolution was driven by
overview of the reported Industry 4.0 implementation challenges in
the relevant literature by conducting a systematic literature review. assembly lines and Henry Ford’s introduction of mass produc-
Specifically, while the present study differentiates between man- tion. The third industrial revolution was driven by the use of
agerial and technological Industry 4.0 implementation challenges, computers and automation in production processes in the 1970s
the focus of the present article is on the managerial Industry 4.0 [3]. Finally, the fourth industrial revolution, better known as
implementation challenges. This overview is performed by deriving Industry 4.0, is a concept coined and introduced by the German
an inductively coded Industry 4.0 technology framework that clas-
sifies Industry 4.0 technologies into ten categories: cyber physical Federal Government to promote its high-tech strategy at the end
systems, Internet of Things, big data analytics, cloud computing, fog of 2011 [4], [5].
and edge computing, augmented and virtual reality, robotics, cyber Since Industry 4.0 is a new concept, many researchers have
security, semantic web technologies, and additive manufacturing. attempted to define it. Piccarozzi et al. [6] defined Industry 4.0
The present article identifies, codes, and defines the managerial based on business strategy and from a managerial viewpoint.
Industry 4.0 implementation challenges and derives opportunities
for overcoming them. Other researchers [2], [3], [7] defined this concept based on
interconnected technologies that are used in implementing In-
Index Terms—Big data analytics (BDA), cyber physical systems dustry 4.0.
(CPS), Industry 4.0, Internet of Things (IoT), managerial
implementation challenges, manufacturing, systematic literature
Thus, the definition of the Industry 4.0 concept is not self-
review. evident, and we argue that it also depends on the researchers’
viewpoint and their research field. Notably, in the present re-
I. INTRODUCTION search, we decided to focus on industry and specifically on
the Industry 4.0 implementation challenges in manufacturing.
ECENTLY, the fourth-industrial revolution, Industry 4.0,
R has become one of the main topics of research and
Thus, the following comprehensive Industry 4.0 definition has
been derived based on the cited references, as well as on the
results inductively generated during the present research (e.g.,
Manuscript received September 25, 2019; revised February 28, 2020 and the list of Industry 4.0 technology categories). Industry 4.0 is
July 30, 2020; accepted September 5, 2020. This work was supported in part a concept aimed at integrating the physical parts of the manu-
by the University of Padova through “Developing and testing Industry 4.0
Mass Customization Implementation Guidelines for SMEs” grant, and in part facturing process (i.e. complex machinery, various devices, and
by the EC within the H2020 Program under Grant 825333 MOSAICrOWN. sensors) [2] and cyber parts (i.e., advanced software), via net-
(Corresponding author: Aleksandar Rikalovic.) works [8]–[11] and driven by Industry 4.0 technology categories
Bojana Bajic and Aleksandar Rikalovic are with the Department of Industrial
Engineering and Management, University of Novi Sad, Novi Sad 21000, Serbia used for prediction, control, maintenance, and integration of
(e-mail: bojana.bajic@uns.ac.rs; a.rikalovic@uns.ac.rs). manufacturing processes [12], where these technology cate-
Nikola Suzic is with the Department of Management and Engineering, Uni- gories are: cyber physical systems (CPS), Internet of Things
versity of Padova, Vicenza 36100, Italy (e-mail: nikola.suzic@unipd.it).
Vincenzo Piuri is with the Department of Computer Science, Università degli (IoT), big data analytics (BDA), cloud computing, fog and edge
Studi di Milano, Milano 26013, Italy (e-mail: vincenzo.piuri@unimi.it). computing, augmented and virtual reality (AR/VR), robotics,
This article has supplementary downloadable material available at https:// cyber security, semantic web technologies, and additive manu-
ieeexplore.ieee.org, provided by the authors.
Digital Object Identifier 10.1109/JSYST.2020.3023041 facturing (AM).

1937-9234 © 2020 IEEE. Personal use is permitted, but republication/redistribution requires IEEE permission.
See https://www.ieee.org/publications/rights/index.html for more information.

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2 IEEE SYSTEMS JOURNAL

Although the Industry 4.0 concept is in the hype and is them. Finally, Section VI derives some conclusions and summa-
expected to lead to worldwide change in manufacturing [13], rizes the paper’s contributions.
evidence of Industry 4.0 implementation in practice is scarce.
Notably, we can argue that Industry 4.0 is still in the “blue sky” II. TECHNOLOGY CATEGORIES FOR INDUSTRY 4.0
solution phase, with academic literature focusing on the concept In this section, we provide definitions of the Industry 4.0 tech-
but providing scarce evidence of its implementation in practice. nology categories. Notably, these technology categories were
Moreover, the reports of Industry 4.0 implementation are usually generated while conducting the present research. Therefore, we
restricted to pilot studies that have limited effects on the whole define Industry 4.0 technology categories as follows.
company. • Cyber Physical Systems represent the systems in which
This lag in reporting Industry 4.0 implementation is even physical objects and software are closely integrated, en-
greater when we consider the reporting of difficulties that com- abling enhanced interaction (i.e., information exchange)
panies have with implementing Industry 4.0 in practice. In the among different components in a myriad of ways [14], [15].
present article, we call these difficulties Industry 4.0 implemen- • The Internet of Things represents a network that provides
tation challenges. Since these implementation challenges are communication between “things” (i.e., objects or devices)
preventing larger scale Industry 4.0 implementation, we also [16] by using sensors via information and communication
argue that it becomes crucial to focus research efforts on the technology infrastructure [16], [17], which results in real-
various Industry 4.0 implementation challenges that companies time sensing and actuating abilities [2].
face. We further define Industry 4.0 implementation challenges • Big Data Analytics represents a practice for revealing hid-
as barriers, problems, obstacles, or issues that appear (or are den information among massive quantities of data (e.g., big
expected to appear) in the Industry 4.0 implementation process datasets), collected from various devices, using advanced
in manufacturing companies. analytical techniques (e.g., data mining, statistical anal-
A preliminary literature review showed that a comprehensive ysis, and predictive analytics) [17], [18], which provides
analysis of the Industry 4.0 implementation challenges does real-time decision making [2].
not exist, even though there is an unspoken agreement between • Cloud Computing represents a computing service that pro-
researchers and practitioners that implementation challenges do vides data storage, sharing and processing through visual-
exist. Moreover, most of the existing literature still refers to “blue ized and scalable resources over the Internet [19].
sky” solutions that were written in 2011. This lack of critical • Fog and Edge Computing represent decentralized comput-
observation of the problems that companies are facing when ing services for storage, processing and applications that
implementing Industry 4.0 is the main motivation for conducting take place on the edges of a network. These services act as
the present research. a middle layer between end users and cloud data centers,
Thus, this article attempts to fill this gap in the literature by effectively reducing the distance that data must travel on
providing a comprehensive overview of Industry 4.0 implemen- the network and producing minimal delays [20]–[24].
tation challenges. It does so through an inductive systematic • Augmented Reality and Virtual Reality represent the infor-
literature review of the relevant papers that report Industry 4.0 mation technologies that provide an indirect experience by
implementation challenges. Notably, the analysis showed that creating a virtual space that interacts with human sensory
Industry 4.0 implementation challenges can be divided into systems (VR) [25] and enable visualization of computer
managerial and technological challenges (see Section IV for graphics placed in the real environment (AR), providing
definitions). Due to a need to focus the research presentation, human interaction with virtual space [26].
this article is focused on managerial Industry 4.0 implementation • Robotics represents a system that uses industrial robots
challenges. Thus, the research is split into two parts. The second and/or robotic devices, which are autonomous, flexible,
part of the research that is yet to be performed and published will and cooperative, for industrial automation with the goal of
focus on the analysis of technological Industry 4.0 implemen- performing production tasks more precisely with minimal
tation challenges that we identified in the analyzed literature. human involvement [2], [13], [27].
In the present research, managerial implementation challenges • Cyber Security represents “the set of technologies and
are identified, coded, and defined, and the opportunities for processes designed to protect computers, networks, pro-
overcoming them in the future are provided (see Tables IV and grams, and data from attack, unauthorized access, change,
V). However, the detailed description of possible solutions for or destruction” [28].
identified challenges is outside the scope of this survey and will • Semantic Web Technologies, as an extension of the current
be included in future planned research activities. web, represent the collaborative movement and the set of
The rest of the article is organized as follows. Section II standards [29] in which information is given a well-defined
provides a theoretical background by defining the technology meaning, better enabling computers and people to work in
categories of Industry 4.0. Section III presents the systematic cooperation [30].
literature review method, providing details on the search and • Additive Manufacturing represents the process of object
selection strategy. Section IV presents the results of the Industry fabrication by joining materials layer-by-layer (as opposed
4.0 managerial implementation challenges analysis performed to subtractive manufacturing technologies) based on dig-
on the relevant articles. Section V discusses managerial imple- ital information, enabling three-dimensional objects to be
mentation challenges by providing opportunities for overcoming produced on demand [31]–[34].

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BAJIC et al.: INDUSTRY 4.0 IMPLEMENTATION CHALLENGES AND OPPORTUNITIES: A MANAGERIAL PERSPECTIVE 3

In the fourth phase, the abstracts of all 440 articles were

read, and Criterion 1 for selection was applied—Fig. 1 (i.e.,
“abstract of the article claims that the article deals with Industry
4.0 implementation”). After the abstract reading, 158 articles
remained in the selection.
Finally, in the fifth phase, by applying Criterion 2 through
full-text reading, the selection was narrowed to 66 relevant
articles (see Fig. 1). Criterion 2 was set to select the articles that
provided indications of Industry 4.0 implementation challenges
(i.e., “article provides challenges for implementing Industry 4.0
in manufacturing”).

IV. RESULTS—INDUSTRY 4.0 IMPLEMENTATION CHALLENGES

ANALYSIS: A MANAGERIAL VIEWPOINT
Relevant articles differed significantly in terms of their scope.
Specifically, the article either covers a wide scope of Industry
4.0 technologies addressing them superficially [3], [37], or the
article’s scope is focused on one or a couple of Industry 4.0
technologies [13], [38], [39].
Since we did not find a suitable framework for the Industry 4.0
implementation challenges analysis, we decided to inductively
Fig. 1. Article search and selections phases (based on [35] and [36]). derive the framework [35], [36] based on our literature review.
As a result, the present research derived a framework of Industry
4.0 technology categories for which implementation challenges
III. METHOD—SYSTEMATIC LITERATURE REVIEW were recorded in the relevant articles. The analysis showed that
In the present research, we conducted a systematic review the main Industry 4.0 technology categories found in the relevant
of the Industry 4.0 academic literature to analyze the available articles are as follows: CPS, IoT, BDA, cloud computing, fog
Industry 4.0 implementation challenges. The research was con- and edge computing, AR/VR, robotics, cyber security, semantic
ducted after a preliminary review of the literature showed that web technologies, and AM.
there is no research dealing comprehensively with the challenges These technology categories present the basis of our in-
of Industry 4.0 implementation in manufacturing companies. ductively derived framework for Industry 4.0 implementation
The search for relevant publications was performed in the Scopus challenges analysis.
scientific database ending on October 26, 2018. The analysis of the relevant articles showed that there are two
The systematic review of the literature included five search types of Industry 4.0 implementation challenges:
and selection phases based on the systematic literature review • Managerial Industry 4.0 implementation challenges—are
method from Suzic et al. [35], [36], see Fig. 1. The first phase challenges that refer to managerial issues in implementing
was the initial search, which comprised four parts: first, the Industry 4.0. For example, these challenges can be a lack
search term “industr∗ 4.0” was used to search article titles, of financial resources, lack of human resources, security
abstracts, and keywords in the Scopus database; second, only issues, and so on. Managerial challenges can be related
articles and articles in press were left in the search; third, the to either the overall implementation of the Industry 4.0
publications published prior to 2012 were excluded (since the concept or the implementation of the defined Industry 4.0
term “Industry 4.0” first appeared in November 2011); and technology category.
finally, all non-English publications were excluded. As a result, • Technological Industry 4.0 implementation challenges—
the initial search yielded 1151 hits. are challenges that refer to specific technological issues
In the second phase, the articles were selected according to in the implementation of Industry 4.0. For example, these
the subject area (see Fig. 1). According to the research scope, challenges can be related to device incompatibility, data
the subject area should be manufacturing related. As a result, analysis, algorithm development, and so on. Technological
the articles from the following subject areas were left in the se- challenges are, by their nature, related to the implementa-
lection: engineering; computer sciences; business, management tion of a specific technology category.
and accounting; and material sciences. As a result, 1074 articles Each of the relevant articles can contain more than one im-
were left in the selection. plementation challenge. As a result, the analysis of the relevant
In the third phase, the selection of articles was conducted articles recorded 55 managerial Industry 4.0 implementation
based on their journal ranking (see Fig. 1). Thus, 440 articles challenges: 23 implementation challenges for Industry 4.0 over-
published in the journals from Q1 and Q2 quartile journal rank- all implementation (recorded 40 times in the relevant articles—
ings of the SCImago database (based on 2017 as the reference Table II) and 32 implementation challenges for defined Industry
year) were retained in the selection. 4.0 technology category implementation (recorded 35 times in

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4 IEEE SYSTEMS JOURNAL

TABLE I
NUMBER OF REPORTED MANAGERIAL IMPLEMENTATION
CHALLENGES PER ARTICLE

Fig. 2. Number of articles that reported Industry 4.0 implementation chal-

lenges per year.

the relevant articles—Table III). Notably, managerial Industry

4.0 implementation challenges were recorded in 28 out of 66
relevant articles.1
Integrated Manufacturing (five articles), Computers in Indus-
A. Trends in Industry 4.0 Implementation try (four articles), and the International Journal of Advanced
Challenges Reporting Manufacturing Technology (four articles). Specifically, the IEEE
Access Journal and the International Journal of Advanced
This section presents recorded trends in Industry 4.0 im- Manufacturing Technology accounted for three articles each
plementation challenges reported in the literature. An analysis reporting managerial Industry 4.0 implementation challenges.
was conducted to provide a comprehensive overview of present The most frequently addressed managerial implementation
state-of-the-art of Industry 4.0 implementation challenges in challenges are related to BDA—The managerial implementation
relevant articles. The trends are as follows. challenges that refer to BDA are reported in five relevant articles.
The earliest reported Industry 4.0 implementation challenges Most of the relevant articles reported only one managerial im-
are recorded in the literature in 2015—thus, there was a four- plementation challenge—Notably, a relevant article can report
year-long vacuum in reporting the challenges after the Industry more than one managerial implementation challenge. Specifi-
4.0 term was coined in 2011. cally, Table I shows the most of the relevant articles reporting
Most of the articles that reported implementation challenges one (12 articles) or two managerial implementation challenges
are recorded in 2018—The analysis shows that the greatest (7 articles).
number of articles containing Industry 4.0 implementation chal- The number of reported managerial implementation chal-
lenges (i.e., 38 out of 66) was published in 2018 (see Fig. 2). lenges is increasing each year—The analysis of managerial
Interestingly, this was 19 times more than in 2015, which implies implementation challenges for Industry 4.0 showed that both
exponential growth in implementation challenges reporting. challenges for the overall implementation and challenges for
The authors that reported most of the implementation chal- defined technology categories were not reported until 2015 (see
lenges are from China—The analysis shows that China is the Fig. 3). Moreover, in 2018, the trend of reporting managerial
country reporting the greatest number of managerial and tech- implementation challenges increased drastically (see Fig. 3).
nological Industry 4.0 implementation challenges (nine articles), Noticeably, in 2018, the number of overall implementation chal-
followed by the USA and Italy (four articles each). Notably, there lenges was larger one-half than the number of implementation
is scientific cooperation in this research field between China and challenges for defined technology category implementation (see
the USA, where there are four jointly written articles addressing Fig. 3).
the Industry 4.0 implementation challenges.
The IEEE Access Journal is the journal that published most
B. Managerial Industry 4.0 Implementation
of the articles reporting implementation challenges—the total
Challenges Analysis
number of journals that published the articles reporting the
managerial and technological Industry 4.0 implementation chal- This section provides the results of the analysis of managerial
lenges was 37. The journals which published most of the articles Industry 4.0 implementation challenges. Managerial Industry
reporting challenges are: the IEEE Access Journal, account- 4.0 implementation challenges can be 1) implementation chal-
ing for eight articles, the International Journal of Computer lenges regarding Industry 4.0 overall implementation (see Ta-
ble II) or 2) implementation challenges for defined Industry 4.0
1 Note: The 28 relevant articles reporting managerial Industry 4.0 implemen-
technology category implementation (see Table III). Both types
tation challenges and analyzed in the present article are the following: [3], [5], of managerial implementation challenges are analyzed in detail
[13], [37]–[61]. in this subsection.

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BAJIC et al.: INDUSTRY 4.0 IMPLEMENTATION CHALLENGES AND OPPORTUNITIES: A MANAGERIAL PERSPECTIVE 5

TABLE III
MANAGERIAL INDUSTRY 4.0 IMPLEMENTATION CHALLENGES FOR DEFINED
TECHNOLOGY CATEGORY RECORDED IN THE RELEVANT ARTICLES

Fig. 3. Number of reported managerial Industry 4.0 implementation chal-

lenges per year divided into (a) managerial challenges for overall Industry 4.0
implementation and (b) managerial challenges for defined technology category
implementation.

TABLE II
MANAGERIAL INDUSTRY 4.0 IMPLEMENTATION CHALLENGES FOR OVERALL
IMPLEMENTATION RECORDED IN THE RELEVANT ARTICLES

1) Managerial Implementation Challenges for Industry 4.0

Overall Implementation: Analysis of the managerial implemen-
tation challenges for Industry 4.0 overall implementation yielded
23 distinct challenges reported 40 times in the relevant articles
(see Table II). These 23 challenges are grouped into 10 groups
that appeared with different frequencies in the relevant articles
(see Table II). Further on, these implementation challenges are
reported in detail in this subsection.
Technology challenges (related to technology management
issues, operations management issues, etc.) are recorded ten
times in the relevant articles (see Table II). The technology
challenges appear in the form of the following.
• Lack of technology maturity [3], [38], [40]—meaning that
the relevant literature determines the majority of existing

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6 IEEE SYSTEMS JOURNAL

technologies as not mature enough to satisfy the require- about the benefits of Industry 4.0 and are open-minded in
ments for the highly complex implementation of Industry regard to the implementation of new advanced technologies
4.0 in practice. in manufacturing companies.
• Lack of manufacturing system integration [3], [5], [13], • Workers’ resistance to knowledge upgrades [38]—the up-
[38], [40]—which implies that the intricacy in the integra- grade of workers’ knowledge is one of the basic require-
tion of different technologies results in the lack of verti- ments for Industry 4.0 implementation. However, the resis-
cal and horizontal integration of the entire manufacturing tance of workers to change and upgrading their knowledge
system. can stop the company from starting/continuing with the
• Company’s unawareness of existing Industry 4.0 technolo- Industry 4.0 implementation process.
gies [37]—which refers to cases when companies are not Security challenges are recorded five times in the relevant
aware of the existing technologies, for example, some cloud articles (see Table II). The security challenges appear in the
services, online design and simulation software, continuous form of the following.
data storage, and high-performance computing. • Manufacturing companies’ low level of trust with second
• Lack of production system reconfiguration ability [13]— parties [37], [44]—which refers to the fact that most man-
specifically, the lack of flexibility in manufacturing compa- ufacturing companies are not willing to share or exchange
nies implies the operational inability to change the produc- information and knowledge with second parties (i.e., other
tion method according to market demands with minimal companies, consultants, and universities) due to companies’
effort and delay. policies and security controls.
Data challenges are recorded six times in the relevant articles • Insecure connectivity protocols [13]—which refer to the
(see Table II). The data challenges appear in the form of the need for real-time communication to have secure connectiv-
following. ity without obstruction by using different protocols among
• The inability to extract knowledge from the data [5], [37]— manufacturing companies.
meaning that the ability to extract useful information from • The need for data protection [3], [13]—which is related
numerous data sources and to transform the data into a form to the need of the manufacturing companies to secure the
readable by different machines/devices has not yet been protection of their confidential data.
reached. Financial resource challenges are recorded five times in the
• The unstructured format of collected data [41]—the un- relevant articles (see Table II). The financial resources chal-
structured format of collected data from different levels of lenges appear in the form of the following.
hierarchical control and multiple data sources leads to an • The need for large investments in new technology [3],
inability to understand the production process in manufac- [13], [43], [44]—which refers to a need to invest sub-
turing companies. stantial financial resources, which in turn divert com-
• The massive data to manage, store, and process [37]—refers panies from considering the implementation of new
to the need of manufacturing companies to manage, store, technologies.
and process a massive quantity of unstructured data without • The uncertain returns on investments [37]—which refers
the support of adequate technology that can handle that to the company’s perceived risk that the implementation
quantity of data at once. of emerging technologies will not improve manufacturing
• Insufficient quality of the collected data [5]—which is processes in the way companies have imagined and will not
reflected in the fact that the data collected in the manu- return the investment.
facturing companies are often irrelevant, redundant, noisy, Manufacturing system challenges are recorded four times in
or unreliable. the relevant articles (see Table II). The manufacturing system
• Insufficient data processing power [41]—which is related challenges appear in the form of the following.
to the company’s need to have a real-time response and • Insufficiently developed manufacturing system infras-
predictive maintenance of the manufacturing system. Ac- tructures [13], [37], [38]—which refers to insufficiently
cordingly, the processing of rapidly generated heteroge- developed or nonexistent information and technological in-
neous big data becomes a challenge for traditional tools frastructure of the manufacturing system that hinder the in-
and existing technologies that have been used in a similar tegration of manufacturing companies and their processes.
way for a long period of time and have become embedded • High manufacturing system complexity [45]—refers to the
as traditional manufacturing processes. inability of the company to manage its manufacturing sys-
Human resource challenges are recorded five times in the tem as a consequence of the implementation of the complex
relevant articles (see Table II). The human resources challenges information and technological infrastructures needed for
appear in the form of the following. Industry 4.0.
• Lack of Industry 4.0 skilled workers [13], [42], [43]— Standardization challenges are recorded two times in the
which refers to Industry 4.0 companies’ need for employees relevant articles (see Table II). The standardization challenges
who possess multidisciplinary skills in informatics, math- appear in the form of the following.
ematics, management, data analytics, and engineering. • Difficulties in establishing uniform standards for informa-
• Lack of workers with a clear vision and commitment to tion exchange [37], [44]—with the Industry 4.0 concept
Industry 4.0 implementation [40]—which refers to the still being vague to many companies, the establishment
deficiency of highly educated workers who have a vision of standards for information exchange in manufacturing

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BAJIC et al.: INDUSTRY 4.0 IMPLEMENTATION CHALLENGES AND OPPORTUNITIES: A MANAGERIAL PERSPECTIVE 7

companies remains a challenge, mainly due to inability to mutual connection and seamless integration between phys-
reach an agreement on uniform standards. Consequently, ical and virtual systems and the achievement of interaction
this nonexistence of uniform standards results in the in- in real time.
ability to share or exchange information and knowledge • An insufficient level of technological intelligence [47]—
generated on different platforms. refers to the current level of achieved equipment intelli-
Communication challenges are recorded once in the relevant gence that often does not fulfill the requirements of the
articles (see Table II). The communication challenges appear in CPS technologies’ implementation.
the form of the following. Managerial implementation challenges for IoT are recorded
• Lack of Internet connectivity [37]—which refers to the in the form of three distinct implementation challenges in the
companies in undeveloped countries having issues with In- relevant articles (see Table III). The IoT challenges appear in
ternet connectivity. Consequently, these connectivity prob- the form of the following.
lems affect information sharing and collaboration between • Difficulties in the shop-floor installation of IoT technol-
manufacturing companies. ogy [49]—refers to the installation of new IoT technol-
Strategy challenges are recorded once in the relevant articles ogy aimed at capturing real-time data in manufacturing
(see Table II), and they appear in the following form. processes.
• Lack of strategy [13]—which refers to the lack of a system- • Resistance to adopting new technology due to the need for
atic approach to adopting new Industry 4.0 manufacturing large investments [50]—refers to the reluctance to apply
concepts that enable more flexible and dynamic manufac- new IoT technology due to unclear potential benefits while
turing. expecting large investments.
Environmental challenges are recorded once in the relevant • The need for a backup plan for IoT implementation [51]—
articles (see Table II). The environmental challenges appear in refers to the difficulty in understanding what will hap-
the form of the following. pen after IoT implementation, which refers to the need
• The need to prevent potential serious environmental side to develop drop-out plans that would enable the com-
effects of Industry 4.0 implementation [13]—refers to a pany to return the pre-IoT implementation manufacturing
need to prevent effects on the environment during Industry settings.
4.0 implementation. For example, the use of automation in Managerial implementation challenges for BDA are recorded
manufacturing companies and heavy energy consumption in the form of 14 distinct implementation challenges in the
may cause the emission of large quantities of greenhouse relevant articles (see Table III). The BDA challenges appear
gases. Thus, to prevent these effects, companies are chal- in the form of the following.
lenged to comply with environmental norms during Indus- • The lack of human resources [52], [53]—which refers to
try 4.0 implementation. the difficulty in finding and keeping reliable employees
2) Managerial Implementation Challenges for Industry 4.0 with a strong vision, commitment to realizing Industry 4.0
Defined Technology Category Implementation: Analysis of the concept and strong multidisciplinary skills. These multi-
managerial implementation challenges for Industry 4.0 defined disciplinary skills cover engineering, computing, analytics,
technology category implementation yielded 32 distinct chal- design, planning, automation, and production.
lenges reported 35 times in the relevant articles (see Table III). • The inability to develop BDA algorithms [52], [54]—which
These 32 challenges are grouped into 11 groups based on the refers to the need for the company to possess a cross-domain
technology category/categories they address (see Table III). analytics team capable of creating and designing offline
Further on, these implementation challenges are reported in prediction algorithms and early issue detection.
detail in this section. • The need for large investments in data storage [52], [53]—
Managerial implementation challenges for CPS are recorded which refers to the company’s financial resources needed
in the form of three distinct implementation challenges in the to acquire one central location for data storage (e.g., the
relevant articles (see Table III). The CPS challenges appear in cloud).
the form of the following. • Organizational challenges [52]—includes challenges asso-
• The need for large investments in CPS technology with ciated with achieving a positive impact on the manufac-
uncertain returns on investments [46]—which means that turing process using BDA technologies and aligning the
CPS technology requires large investments, while at the objectives of analytics with the overall corporate strategy.
same time, the return of those investments is dependent • The insufficient knowledge about data variation require-
on “high product quality, factory throughput, equipment ments [52]—includes various requirements (e.g., the for-
utilization, flexibility, and low energy consumption” and mat, availability, quality, security, and data acquisition)
the return is not certain. from different devices for system coordination.
• The need for large investments in employee training courses • The inability to integrate and synchronize databases [52]—
for using the CPS technology [47]—refers to the need to refers to the challenges of synchronization and integration
organize employee training courses for use of the CPS of databases into existing systems in accordance with man-
technology, which in the end amount to large investments ufacturing company policies.
for organizing such training activities. • The inability to achieve real-time maintenance [54]—which
• Lack of manufacturing system integration [48]—in the case is related to the company’s inability to efficiently achieve
of the CPS technologies implementation is related to the real-time active maintenance using big data.

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8 IEEE SYSTEMS JOURNAL

• The unreliability of actions taken on the basis of obtained planning, MES—manufacturing execution systems, and
analytics [52]—represents the doubt in the validity of the QMS—quality management systems) and information ex-
obtained results of the analytics, which stops BDA imple- change across the entire manufacturing system and product
mentation processes. lifecycle.
• The unreliability of storing data in one central location Managerial implementation challenges for AM are recorded
[52]—which represents the data storing security issues in the form of two distinct implementation challenges in the
regarding the possibilities of cyber-attacks. relevant articles (see Table III). The AM challenges appear in
• The financial feasibility regarding company size [52]— the form of the following.
which refers to the fact that small and medium enterprises • The lack of skilled workers for AM processes [58]—refers
(SMEs) usually do not have a sufficient amount of financial to difficulty of finding the educated/trained workers capable
resources to invest in BDA technology compared with large of performing the AM processes.
enterprises. • Excessive investments in AM equipment [58]—refer to
• The unprofitable data kept in a limited storage space [52]— financial investments in AM equipment that companies
refers to the data that do not provide any additional value consider excessive in comparison to the expected return.
but use storage space. Consequently, the question for the Managerial implementation challenges for multiple technol-
company is whether these data will be needed in the future ogy implementation are managerial challenges that refer to the
and, if not, when the data should be deleted. simultaneous implementation of multiple technology categories
• Legislation challenges [53]—represent the legal restric- (see Table III):
tions that may limit companies in the adoption of new • IoT and AM;
technology. • IoT, BDA, and robotics;
• The lack of information system standards [53]—refers to • CPS, IoT, and cloud computing;
issues when the policy of the company does not allow for the • CPS, IoT, BDA, and cloud computing.
adoption of certain open information automation network According to the analysis, five implementation challenges for
standards, such as the Open Platform Communications multiple technology categories are recorded in the relevant arti-
server for device communications and the ISA95 for system cles (see Table III). The multiple technology category challenges
interoperability. appear in the form of the following.
• The need for developing a backup implementation plan • The lack of manufacturing system integration in the joint in-
[53]—refers to the need to develop a reserve implemen- tegration of IoT and AM [59]—which refers to the difficulty
tation or drop-out plan in the case that during the imple- of the company in achieving seamless digital workflow
mentation process, problems occur with a negative impact integration of the product lifecycle.
on a company’s manufacturing performances. • The inability to produce mass-customized products (IoT,
Managerial implementation challenges for cloud computing AM) [59]—which refers to the difficulty of the company
are recorded in the form of one implementation challenge in the in developing highly flexible and adaptive manufacturing
relevant articles (see Table III). The cloud computing challenge processes capable of manufacturing customized products
appears in the form of the following. with an efficiency comparable to mass production.
• Insufficiently developed technology level [55]—which is • Legislation restrictions for robotics in the joint integration
related to technical limitations that constrain the applica- of IoT, BDA, and robotics [60]—which refers to the limited
tion of advanced technology, e.g., industrial robots due to implementation of robots in companies (e.g., autonomous
constrained computing and communication challenges. vehicles) due to a lack of regulated legislation that would
Managerial implementation challenges for fog/edge comput- enable their implementation.
ing are recorded in the form of one implementation challenge • The lack of financial resources for the joint implementa-
in the relevant articles (see Table III). The fog/edge computing tion of the CPS, IoT, and cloud computing [61]—refers
challenge appears in the form of the following. to the need to invest substantial financial resources in the
• The lack of manufacturing system integration using implementation of these three technologies, where it should
fog/edge computing technologies [56]—refers to the issues be stressed that the current technological solutions are not
of system integration linked to the lack of software systems affordable for SMEs.
that could be integrated seamlessly due to different data rep- • Obstacles for data collection in the joint implementation
resentations by different systems, incompatible interfaces, of CPS, IoT, BDA, and cloud computing [39]—refers to
different communication protocols, and so on. the high dimensionality, variability in metrics, high noise,
Managerial implementation challenges for AR/VR are and unstructured nature of data acquired from intelligent
recorded in the form of one implementation challenge in the manufacturing equipment.
relevant articles (see Table III). The AR/VR challenge appears • The need for technology improvement in the joint imple-
in the form of the following. mentation of CPS, IoT, BDA, and cloud computing [39]—
• The lack of manufacturing system integration using AR/VR refers to the need for improvements in the intelligence level
technologies [57]—refers to the issues of manufacturing of the manufacturing equipment to better respond to prob-
system integration, which include integrating heteroge- lems such as dynamic scheduling and the connection be-
neous software systems (e.g., ERP—enterprise resource tween functions and devices in the manufacturing system.

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BAJIC et al.: INDUSTRY 4.0 IMPLEMENTATION CHALLENGES AND OPPORTUNITIES: A MANAGERIAL PERSPECTIVE 9

V. DISCUSSION The IEEE Access Journal is the journal that published most
The research results reported in the previous section lead of the articles reporting implementation challenges—It is not
to discussion of managerial Industry 4.0 implementation chal- surprising that the IEEE Access Journal was the journal that
lenges, providing the following: accounted for the majority of articles reporting the Industry 4.0
1) analysis of trends in Industry 4.0 implementation chal- implementation challenges. IEEE Access Journal is multidisci-
lenges reporting; plinary (covering computer sciences, engineering, and material
2) critical review of the recorded Industry 4.0 managerial sciences) and publishes a variety of article types (i.e., techni-
implementation challenges; cal articles, applications-oriented and interdisciplinary articles,
3) derived opportunities for overcoming managerial Industry surveys, and reviews) that cover a wide range of Industry 4.0 im-
4.0 implementation challenges for overall implementa- plementation topics. The analysis of the source publications of
tion; the articles dealing with Industry 4.0 implementation challenges
4) derived opportunities for overcoming managerial imple- also showed that most of the journals are engineering journals
mentation challenges for Industry 4.0 defined technology with a strong focus on computer science and practice (e.g., the
category implementation. IEEE Access Journal, the International Journal of Computer
Integrated Manufacturing, Computers in Industry, and the In-
ternational Journal of Advanced Manufacturing Technology).
A. Analysis of Trends in Industry 4.0 Implementation This trend will probably continue in the future since Industry
Challenges Reporting 4.0 is a strongly technology-oriented concept.
Trends in Industry 4.0 implementation challenges reporting The most frequently addressed managerial implementation
identified in the present research provide a specific state-of-the- challenges are related to BDA—Based on this finding, it could be
art of the advancement in the implementation of Industry 4.0 argued that, for the moment, BDA represents the most significant
in practice. The trends reported in the Results section do this technological bottleneck for implementation of Industry 4.0 in
through the analysis of the challenges the industry faces while practice. If this conclusion is correct, then we can expect that
implementing Industry 4.0. In the current section, implications in the near future, considerable attention from researchers and
of these trends are further discussed. industry will be focused on solving implementation challenges
The earliest reported Industry 4.0 implementation challenges related to BDA.
are recorded in the literature in 2015—However, the Industry Most of the relevant articles report only one managerial
4.0 concept appeared in 2011. Thus, in the four-year period, the implementation challenge—The analysis showed that when ar-
literature did not report any of the Industry 4.0 implementation ticles reported implementation challenges, most reported only
challenges (see Fig. 2). This vacuum is natural since the concept one (see Table I). We could argue that this is due to the focus
was completely new for the industry. As a consequence, the of the paper but also due to hesitation to report the challenges
implementation challenges started appearing in the literature for some reason. Additionally, it could be argued that the liter-
four years later. Moreover, this lag in challenges reporting fits ature is still mainly focused on the positive aspects of Industry
with the “innovation trigger” period from the Gartner hype cycle 4.0 implementation, along with the created Industry 4.0 hype,
[62], where early proof-of-concept stories and interest in the neglecting the difficulties of Industry 4.0 implementation to a
media caused significant publicity for the Industry 4.0 concept. large extent.
Most of the articles that reported implementation challenges The number of reported managerial implementation chal-
are recorded in 2018—The analysis showed that reported man- lenges is increasing each year—The number of reported man-
agerial Industry 4.0 implementation challenges had exponential agerial implementation challenges grew for both overall imple-
growth (see Fig. 2). On the basis of these results, we argue that mentation challenges and implementation challenges for defined
this trend will continue in the near future. In fact, it can be technology category implementation. According to the analysis
expected that as more Industry 4.0 implementation is performed, (see Fig. 3), for 2018, the number of reported challenges for
more challenges will be faced by the experts and more of overall implementation was larger by one-half than the number
these challenges will be reported in the literature. Furthermore, of challenges for a defined technology category implementation.
this exponential growth in implementation challenges reporting However, with maturation and wider implementation of Industry
corresponds with the hype Industry 4.0 is causing in the industry 4.0, we can probably expect that in the near future, the number of
and academia [2]. reported managerial challenges for defined technology category
The authors that reported most of the implementation chal- implementation will increase and surpass the reported overall
lenges are from China—Interestingly, most of the authors re- implementation challenges.
porting the challenges are from China, followed by the USA
and Italy. It is somehow understandable that China, as a country
B. Critical Review of the Recorded Industry 4.0 Managerial
that is investing highly in technology and has roughly one-fifth
Implementation Challenges
of the world population, is in first place on this list. Nevertheless,
a valid question to ask could be why there are not more articles As stated in the Introduction section, the present research
from Germany providing implementation challenges since In- is focused on managerial Industry 4.0 implementation chal-
dustry 4.0 is being popularized by the German government and lenges. These challenges articulate either overall issues with
industry. Industry 4.0 implementation (e.g., human resources, security,

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10 IEEE SYSTEMS JOURNAL

and financial resources—Table II) or issues that are connected C. Deriving Opportunities for Overcoming Managerial
with a defined Industry 4.0 technology (e.g., CPS, IoT, and Implementation Challenges for Industry 4.0 Overall
BDA—Table III). Implementation
Both types of managerial implementation challenges bring
In the Results section, the managerial Industry 4.0 imple-
specific value to the system designer as the final user of the
mentation challenges for overall implementation have been
surveyed research. Thus, the overall challenges help the im-
identified, coded, and defined (Section IV-B1). In the present
plementer create a more strategic viewpoint, while the defined
subsection, we build upon the obtained results by deriving op-
technology category challenges provide more specific informa-
portunities to overcome each of the identified challenges. These
tion regarding the problems with the implementation of the
opportunities are provided in tabular form to be concise and
defined technology. Notably, both types of challenges analyzed
comprehensive and to avoid redundancy (see Table IV).
in the present research refer to the managerial issues of the
Notably, neither Table IV nor Table V provides a detailed
implementation without going into the specifics of technology
description of possible solutions for the identified challenges.
implementation. This detailing of the issues of the implementa-
This task is outside the scope of this survey. Moreover, a detailed
tion of specific technologies is outside the scope of the present
understanding of the causes of the challenges is essential to
research. The research on the technological Industry 4.0 im-
address them in the specific instance of a system. This un-
plementation challenges, which will complement the present
derstanding needs to be performed by the system designers,
research, is underway.
considering all characteristics of the specific technologies that
Managerial implementation challenges for Industry 4.0 over-
the company is using and the specific implementation case.
all implementation in almost 80% of the cases focus on tech-
nology, data, human resources, security, or financial resources
(see Table II). Furthermore, they comprise approximately 60% D. Deriving Opportunities for Overcoming Managerial
of all managerial challenges reported in the present research Implementation Challenges for Defined Industry 4.0
(see Fig. 1). However, it can be argued that in some cases, these Technology Category Implementation
challenges can be seen as too generic for the system designer. In the Results section, the managerial Industry 4.0 imple-
This argument will probably depend on the current status of the mentation challenges for defined technology category imple-
company implementing Industry 4.0. Thus, a company that is at mentation have been identified, coded, and defined (see Section
the beginning of the Industry 4.0 implementation is expected to IV-B2). In this subsection, we build upon the obtained results
have a high interest in this type of challenge. We can also expect by deriving opportunities to overcome each of the identified
that a company that has made large advances in implementing challenges. These opportunities are provided in a tabular form
Industry 4.0 will have more interest in managerial implemen- to be concise and comprehensive and to avoid redundancy (see
tation challenges for defined technology categories and in the Table V).
technological implementation challenges. Notably, for some of the identified Industry 4.0 technol-
The managerial implementation challenges for the defined ogy categories, we did not identify managerial implementation
technology category are dispersed among seven different single challenges in the relevant literature, namely, robotics, cyber
technologies and an additional four groups of technologies (see security, and semantic web technologies. Interestingly, even
Table III). Notably, three technology categories dominate the though managerial implementation challenges were not sepa-
list of these challenges, namely: BDA, CPS, and IoT. Specifi- rately recorded for robotics, the robotic implementation chal-
cally, the most challenges are reported for the BDA (14 distinct lenge was recorded for the implementation process of multiple
challenges—Table III). This implies that the BDA along with the technologies, namely, IoT, BDA, and robotics.
CPS (four challenges) and the IoT (three challenges) is currently
the focus of the researchers’ and industry attention. Furthermore,
this implies that the current work is being performed to address VI. CONCLUSION
problems in these three technologies that represent, especially Initial literature sampling revealed that only a minority of
the BDA, the bottleneck but also the basis for implementation the available Industry 4.0 papers deals with the Industry 4.0
of other Industry 4.0 technologies. implementation challenges while prevalently proposing bene-
While the focus of this type of challenges is on BDA, CPS, and fits obtained by Industry 4.0 implementation. Thus, the initial
IoT, there are some technologies that, on their own, do not report insight was that the current focus of the research literature is on
a single challenge (i.e., robotics, cyber security, and semantic the benefits of Industry 4.0 and not on the challenges that are
web technologies—Table III). The use of these technologies, or encountered in the implementation of the concept. Moreover,
the advanced part of these technologies (e.g., use of cobots in a comprehensive analysis of the Industry 4.0 implementation
robotics), in Industry 4.0 is still evolving. Consequently, we can challenges was not found in the literature. However, we argue
argue that the challenges are not yet visible to the Industry 4.0 that these implementation challenges are preventing larger-scale
system designers and implementers. Thus, they are not reported Industry 4.0 implementation, and thus, it is crucial to focus
yet in the literature, even though they are known in the com- research efforts on the various Industry 4.0 implementation
munity to be a challenge. We expect to further complement the challenges companies face.
understanding of the implementation challenges with the next Consequently, the goal of the present research was set to
step of the research focused on the technological implementation survey the state-of-the-art of the current trends of the Industry 4.0
challenges. implementation challenges, to identify these challenges, define

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BAJIC et al.: INDUSTRY 4.0 IMPLEMENTATION CHALLENGES AND OPPORTUNITIES: A MANAGERIAL PERSPECTIVE 11

TABLE IV
OPPORTUNITIES FOR OVERCOMING MANAGERIAL IMPLEMENTATION CHALLENGES FOR INDUSTRY 4.0 DEFINED TECHNOLOGY CATEGORY/CATEGORIES

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12 IEEE SYSTEMS JOURNAL

TABLE V
OPPORTUNITIES FOR OVERCOMING MANAGERIAL IMPLEMENTATION CHALLENGES FOR INDUSTRY 4.0 DEFINED TECHNOLOGY CATEGORY/CATEGORIES

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BAJIC et al.: INDUSTRY 4.0 IMPLEMENTATION CHALLENGES AND OPPORTUNITIES: A MANAGERIAL PERSPECTIVE 13

them, code them, and derive opportunities to overcome them defining the managerial implementation challenges will
in the future. This goal was achieved through conducting an be highly interesting to Industry 4.0 researchers, the de-
inductive systematic literature review of the Industry 4.0 liter- rived opportunities for overcoming these challenges (see
ature (66 relevant articles). Notably, while the present research Table IV and Table V) take the present research one step
identified two types of Industry 4.0 implementation challenges further in contributing to the Industry 4.0 literature. Specifi-
(managerial and technological), aside from the general trends cally, these opportunities provide a plethora of possibilities
in Industry 4.0 implementation challenges, the focus of the for new research endeavors as well as insights into possible
research was on the identification and analysis of the managerial future developments in Industry 4.0 implementation.
Industry 4.0 implementation challenges (addressed in 28 of 66 We recognize that the present research has its limits by focus-
relevant articles). Moreover, two main groups of managerial ing on only academic journals. We also recognize the importance
Industry 4.0 implementation challenges were further identified of the large amount of material coming from industry confer-
and analyzed: managerial implementation challenges for over- ences, technology workshops, industry-focused magazines, and
all Industry 4.0 implementation and managerial implementa- other nonacademic sources. However, since, to the best of our
tion challenges for Industry 4.0 defined technology category knowledge, a survey on the implementation challenges does not
implementation. exist in the literature, with the present research, we provide value
As previously stated, the present research adds to the existing to the community with the analysis of a significant amount
Industry 4.0 literature with the following contributions. of material from academic journals. In this way, the present
• Identified: relevant articles that report Industry 4.0 imple- research provides the first step by identifying the most significant
mentation challenges in the literature. To the best of our challenges that designers and implementers need to have clear in
knowledge, the present research is the first to focus com- mind to avoid large mistakes in the Industry 4.0 implementation.
prehensively on Industry 4.0 implementation challenges. The analysis of the additional material (i.e., industry confer-
This article provides a list of the 28 relevant articles (from ences, technology workshops, and industry-focused magazines)
66) that reported managerial Industry 4.0 implementation will add some valuable additional aspects. However, this will be
challenges (28 relevant articles are listed in the introduc- a valuable addition addressed in future analyses.
tion of the Results section—Footnote 1). We expect that As mentioned in the Introduction, the present research shows
the identification of these articles will be of interest to that there are two types of Industry 4.0 implementation chal-
researchers dealing with Industry 4.0 implementation in lenges: managerial and technological. This article focuses only
the future. on the managerial challenges since this multifaceted area already
• Identified main trends in Industry 4.0 implementation chal- has significant complexity. In future analyses, we will focus on
lenges reporting (see Section IV-A): In addition to iden- technological Industry 4.0 implementation challenges.
tifying the main trends in the implementation challenges
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