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Industry 4.0 is an umbrella term for a group of emerging and already available digital technologies that, when combined, have the potential to usher in a more efficient era of manufacturing. Automation, comprehensive networking of all areas of production and the Internet of Things will drive a digital communication flow between machines, internal and external value chain actors. It facilitates the vision of a smart factory.

Smart factories, where human beings, machines and products communicate with each other as naturally as on a social networking site like Facebook or Twitter, are capable of managing higher levels of complexity, are less prone to disruption and able to manufacture goods more efficiently. This networked production system makes it possible to build smarter manufacturing processes and supply chains. Industry 4.0 is not just about technology; it represents a new approach to manufacturing. The concept originated in Germany, but the realization of the transformational power of connected, digitalized manufacturing has inspired related initiatives in North America, China, and other Western European countries.8 Although these initiatives may have regional specificities, the advantage for upholstered furniture manufacturers remains the same: a concrete response to new consumer demands in terms of customization, speed and cost.

However, many questions remain.  What does it mean for upholstered furniture manufacturers? How can they begin integrating Industry 4.0 technology into their furniture production process?

“Furniture Manufacturing in the Industry 4.0 Era” aims to answer these questions. This white paper explores how Industry 4.0 can help upholstered furniture manufacturers respond to current market demand for custom and made-to-order furniture.

Customized goods were the norm in pre-industrialized societies. With the advent of the Industrial Revolution, manufacturers embraced the mass production model and the lure of cheap, readily available goods drew consumers away from the unique pieces that characterized the craft era. Enter the 21st century, where a backlash against the uniformity of mass-produced products has re-ignited consumers’ desire for unique, customized products.

A certain level of furniture customization existed even within the mass production model. However, consumers are no longer content with the choice between 10 or 15 colors. They are demanding an ever-greater array of materials, models, variants, and other customization options. Mass market mentalities have given way to demands for furniture that not only matches the buyers’ interior décor but also reflects their inner self.

As the demand for personalized furniture increases, so too does the complexity of manufacturing. This increasing demand for customization is straining the efficiency and profitability of current manufacturing models. However, companies that are unable to offer the increasingly high levels of customization that consumers demand risk losing revenue and customer loyalty.

So, what can upholstered furniture manufacturers do to adapt to the changing market scenario and ensure that they thrive in a dynamic, global marketplace? Many observers believe that we are on the cusp of a new industrial revolution, commonly referred to as the Fourth Industrial Revolution or Industry 4.0, which will provide companies with the means to respond to the growing complexities of manufacturing and enable greater possibilities for product innovation and business model transformation.

While the first three industrial revolutions unleashed hitherto unimagined productivity and efficiency, analysts predict the fourth revolution will be even more disruptive. According to Klaus Schwab, the founder and Executive Chairman of the World Economic Forum, compared to the previous industrial revolutions, “the Fourth is evolving at an exponential rather than a linear pace.”