Before we focus on the intricacies of the smart factory, by way of introduction, a few words must be said about its underlying concept, the Industrial Internet of Things.    

A Smart Factory, as the name suggests, is a smart industry. The term describes a highly digitalized and connected environment where machinery and equipment are able to improve processes through automation and self-optimization. The benefits also extend beyond just the physical production of goods and into functions like planning, supply chain logistics, and even product development.

The way the term is most commonly used, a  Smart Factory is a highly digitized shop floor that continuously collects and shares data through connected machines, devices, and production systems. The data can then be used by self-optimizing devices or across the organization to proactively address issues, improve manufacturing processes and respond to new demands.

Yet, the core value of the smart factory still happens within the four walls of the plant. The structure of a smart factory can include a combination of production, information, and communication technologies, with the potential for integration across the entire manufacturing supply chain.

Industry 4.0 refers to the approach of using advanced digital technologies to revamp the practices of industries from initial designing to customer support. By digitalizing the whole industry, it improves the operational efficiency of a plant whilst boosting the growth of the enterprise.