Quality Management, Value Creation, and the Digital Economy (Routledge Advances in Production and Operations Management) [1 ed.] 1032519657, 9781032519654

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Quality Management, Value Creation, and the Digital Economy

In the conditions of the modern market economy, in which globalization and competition are rife, quality is of great importance for determining a company’s position in the market. The changing and complex economic reality is shaping new market patterns while modern technologies influence purchasing decisions. This book presents an effective and novel framework for creating value in Industry 4.0 conditions by building a smart enterprise model using quality management theories. The book explores tools and platforms that can be utilized to contribute to the creation of the ideal quality for demanding customers, using case studies from international contributors. It proposes novel architectures that drive economically viable production and services businesses, addressing unique Industry 4.0 and 5.0 solutions in Internet of Things (IoT) that involve the entire spectrum of analysis, with a special focus on lean methodologies and cybersecurity. This original book will be valuable reading for researchers and scholars in the areas of quality management, manufacturing, production, and operations management. Joanna Rosak-Szyrocka is Assistant Professor at the Częstochowa University of Technology, Faculty of Management, Department of Production and Safety Engineering, Poland. Justyna Żywiołek is Assistant Professor at the Częstochowa University of Technology, Faculty of Management, Department of Production and Safety Engineering, Poland. Muhammad Shahbaz is Professor of Economics at the Beijing Institute of Technology, China, and Visiting Research Fellow at the University of Cambridge, UK.

Routledge Advances in Production and Operations Management

This series sets out to present a rich and varied collection of cutting-edge research on production and operations management (POM), addressing key topics and new areas of interest in order to define and enhance research in this important field. Bringing together academic study on all aspects of planning, organizing and supervising production, manufacturing or the provision of services, subject areas will include, but are not limited to: operations research, product and process design, manufacturing strategy, scheduling, quality management, logistics and supply chain management. Highly specialised and industry-specific studies are actively encouraged. Real-time Simulation for Sustainable Production Enhancing User Experience and Creating Business Value Edited by Juhani Ukko, Minna Saunila, Janne Heikkinen, R. Scott Semken and Aki Mikkola Quality Management, Value Creation, and the Digital Economy Edited by Joanna Rosak-Szyrocka, Justyna Żywiołek and Muhammad Shahbaz

For more information about this series, please visit: https://www.routledge.com/The-Routledge­ Philosophers/book-series/RAPOM

Quality Management, Value Creation, and the Digital Economy Edited by Joanna Rosak-Szyrocka, Justyna Żywiołek and Muhammad Shahbaz

First published 2024 by Routledge 4 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 605 Third Avenue, New York, NY 10158 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2024 selection and editorial matter, Joanna Rosak-Szyrocka, Justyna Żywiołek and Muhammad Shahbaz individual chapters, the contributors The right of Joanna Rosak-Szyrocka, Justyna Żywiołek and Muhammad Shahbaz to be identified as the authors of the editorial material, and of the authors for their individual chapters, has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library ISBN: 978-1-032-51965-4 (hbk) ISBN: 978-1-032-51969-2 (pbk) ISBN: 978-1-003-40468-2 (ebk) DOI: 10.4324/9781003404682 Typeset in Times New Roman by Apex CoVantage, LLC

Contents

List of Contributors Preface Introduction 1 The Phenomenon of Industry 5.0: Challenges, Trends in Globalization Conditions

vii ix x

1

MAHMUDUL HASAN LASKAR

2 Advantages and Disadvantages of Industry 5.0 in the Twenty-First Century

20

SIMONA BIGERNA, SILVIA MICHELI, AND PAOLO POLINORI

3 Industry 5.0’s role in achieving sustainability in multiple sectors

44

SUMANTA BHATTACHARYA

4 Client and Value in the Quality Management: A Case of Society 5.0

56

ZAFARULLAH SAHITO, RAJA BAHAR KHAN SOOMRO, AND ANNA-MARIE PELSER

5 Transformation Customers Needs in the Aspect of Client Value

82

ADITYA HALIM PERDANA KUSUMA PUTRA

6 Industry 4.0 on the Way to Companies’ Performance

99

NAVEED R. KHAN, MUHAMMAD RAHIES KHAN, AND ARSALAN MUJAHID GHOURI

7 The Influence of Industry 4.0 on Client Value Added RAVI KUMAR GUPTA AND UDIT MAHESHWARI

121

vi

Contents

8 Quality Management for Assurance Value of the Customer in Industry 4.0 Times

129

HANA ŠTVERKOVÁ AND MICHAL POHLUDKA

9 Good Management and Deploying New IT Tools in Industry 4.0 in the Value-Creating Direction

142

ELSHAN AHMADOV, ESRA SİPAHİ DÖNGÜL, AND SHAJARA UL-DURAR

10 The Ideal Quality in Industry 4.0 Model for the Company and Its Meaning in the Client Value Perspective: A Systematic Review

153

FARHAN MIRZA, SHAJARA UL-DURAR, AND ABDUL JABBAR

11 Quality and Value Management in Education in the Digitalization Era

167

SHASHI KANT GUPTA AND JOANNA ROSAK-SZYROCKA

Index

181

Contributors

Mahmudul Hasan Laskar Assistant Professor, Department of Sociology, University of Science and Technology, Meghalaya, India Simona Bigerna Department of Economics, University of Perugia, Via A. Pascoli 20, 06100, Perugia, Italy, [email protected] Silvia Micheli Department of Economics, University of Perugia, Via A. Pascoli 20, 06100, Perugia, Italy Paolo Polinori Department of Economics, University of Perugia, Via A. Pascoli 20, 06100, Perugia, Italy Sumanta Bhattacharya Research Scholar at MAKAUT Public–Foreign-Defence Policy Analyst, CE, CHE, CCIO, MTech, MA, in Development Studies, LLB, MA, in Security and Defence Law, DIA&D, DG&GS, PGDESD, MPI (Oxford University) Zafarullah Sahito Department of Education, Sukkur IBA University, Sukkur, Sindh, Pakistan Faculty of Economic and Financial Sciences, North-West University, South Africa Raja Bahar Khan Soomro Department of Education, Sukkur IBA University, Sukkur, Sindh, Pakistan Anna-Marie Pelser Faculty of Economic and Financial Sciences, North-West University, South Africa Aditya Halim Perdana Kusuma Putra Assistant Professor, Faculty of Economics and Business, Department of Marketing Management, Universitas Muslim Indonesia, Indonesia Naveed R. Khan UCSI University, Malaysia Muhammad Rahies Khan Department of Management Studies, Bahria Business School, Bahria University, Pakistan Arsalan Mujahid Ghouri Universiti Pendidikan Sultan Idris, Malaysia

viii Contributors Ravi Kumar Gupta Assistant Professor, Department of Humanities and Management Science, Madan Mohan Malaviya University of Technology, Gorakhpur, India Udit Maheshwari Research Assistant, Department of Humanities and Management Science, Madan Mohan Malaviya University of Technology, Gorakhpur, India Hana Štverková Senior Lecturer, Department of Business Administration, Faculty of Economics, VSB-Technical University of Ostrava, Ostrava, Czech Republic; and University of Johannesburg, School of Public Management, Governance & Public Policy, Auckland 2006, Johannesburg, JAR Michal Pohludka CEO, mikeVision, s.r.o., Prague, Czech Republic Assoc. Prof. Elshan Ahmadov, The Academy of Public Administration under the President of the Republic of Azerbaijan/Faculty of Administrative Sciences; andVisiting Assoc. Prof. at the Azerbaijan State University of Economics, Baku/ Azerbaijan. Assist. Prof. Esra SİPAHİ DÖNGÜL, Aksaray University, Faculty of Health Sciences, Department of Social Work, Aksaray, Turkey Shajara Ul-Durar, Associate Professor of Management and Leadership, University of Sunderland, The School of Business, Edinburgh Building, Chester Road, Sunderland, United Kingdom SR1 3SD Farhan Mirza Lecturer, Business & Management, University of Management and Technology, Sialkot campus, Malaysia Abdul Jabbar Associate Professor, Data Strategy and Analytics, Deputy Direc­ tor of the MBA, School of Business, University of Leicester, Leicester, UK LE1 7RH Shashi Kant Gupta Ph.D. & Researcher, Integral University, Lucknow, UP, India

Preface

At least 40% of all businesses will die in the next 10 years . . . if they don’t figure out how to change their entire company to accommodate new technologies. —Cisco Chairman, John Chambers

In the twenty-first century, we are dealing with a prosumer who is well-versed in the goods and services associated with a particular brand and who shares this knowledge with others. The function of the customer in interactions with manufac­ turers is now well understood. The formal system validation phase of this aware­ ness has given way to the real market and organizational expectations. In today’s market, which is becoming more and more competitive, consumers anticipate con­ stant product/service improvement. From an enterprise’s perspective, it is crucial to demonstrate that the firm is fulfilling its social responsibility and treating both its internal and external clients—consumers and employees—in a fair and equitable manner. This is in addition to achieving financial success. Because of this under­ standing, businesses now need to pay attention to consumer preferences, tastes, and lifestyle changes. The aim of the book is to present the issues related to Industry 5.0, which were discussed, taking into account its threats, opportunities, and challenges in the era of digitization, with particular emphasis on the client and his requirements. The book also discusses the issue of quality 5.0 in creating value for the customer and how Industry 4.0 shapes added value for the customer. We hope that the readers will like the book because it was written with passion and love for the value issue as well as quality management aspects.

Introduction

Quality is crucial in today’s market economy since it affects not only how a firm is positioned on the market but also how it develops organizationally. Whether pervasive digitization is gaining momentum and how dynamically e-Commerce is developing will determine how drastically trade will alter. This unquestionably influences the need to provide a customer experience that meets their individual needs and helps to boost brand recognition and business competitiveness. The book consists of 11 chapters. Chapter 1 looked at how various civilizations were dif­ ferentially impacted by Industry 5.0 as a worldwide phenomenon. The viability of Industry 5.0’s adoption by Indian society is examined. This chapter made an at­ tempt to contribute to the Industry 5.0 framework’s sociological analysis of India’s labor force. Through a review of the literature, Chapter 2 gives an analysis that identifies both the benefits and drawbacks of Industry 5.0, which is important for creating a society where sustainability and resilience are top priorities. Chapter 2 also provides an overview of the drawbacks that may occur, particularly in the near term, ranging from challenges with business efficiency to labor concerns. Chap­ ter 3 analyzes how Industrial 5.0 will help many sectors achieve sustainability. In Chapter 4, the link between “Society 5.0,” “client,” “value,” and “quality manage­ ment” is examined through the lens of “educational management and leadership” in order to address the difficulties now facing higher education institutions (ELM). Chapter 5 identifies which determinants are involved in shifting consumer behav­ ior. Chapter 6 discusses Industry 4.0 technologies and their fundamental concepts. Chapter 7 analyzes the influence of Industry 4.0 on client value added. Chapter 8 aims to propose a process for quality management in the Industry 4.0 era to main­ tain customer value, based on literature background and research. Chapter 9 ana­ lyzes the role of digital technologies in management in a value-creating direction. In Chapter 10, 18 main applications of Quality 4.0 in manufacturing were identi­ fied and studied, and several key aspects and enablers of Quality 4.0 for manufac­ turing were investigated. Chapter 11 investigates how professors and deans may learn to use technology to evaluate their students effectively in the post-4.0 era.

1

The Phenomenon of Industry 5.0 Challenges, Trends in Globalization Conditions Mahmudul Hasan Laskar

1.1

Introduction

Globally industrial revolution now reached the advanced phase where industrial production, market, business model, society, and consumer services are structurally transformed. Technological advancement took a momentum shift in the industrial strategy. Developed European nations took lead in this, and today others are adopt­ ing it as a model of transformation. In 2019, European Commission instituted a new industry strategy, namely Industry 5.0 to offer an alternative model of development (European Commission, 2021). It is structurally the continuation of the concept of Industry 4.0. One focus area is integrating other aspects like environment, ecol­ ogy, society, and people besides technology into Industry 5.0. It has been a sub­ ject of debate for around 4 years and later took momentum trend because of the European Commission’s proposed idea of the “Green Deal” or “Industry 5.0” or “Green Industry.” It offered a plan for developing more human-centric, social and environment-friendly innovation, research, and industrial policy (Banholzer, 2022). Previous industrial strategy Industry 4.0 began in 2011, initiated by Germany but it failed to impress the European Union and other developed economies because of its overemphasis on AI or robot technology and less on human-centric technology. In­ dustry 5.0 recognized three main focus areas: sustainability, human-centric techno­ logical advancement, and resilient mechanism. It gives due emphasis to industrial workers’ well-being and takes it as the core element of the process of production. Industry 5.0 transformed many fields in developed countries such as corporate systems, market networking, artificial intelligence-based work environment, digi­ tal supply chain, and healthcare and education. Today, living of people changed along with the digitalization of the world. But there is an uneven impact of Industry 5.0 on the various regions of the world. Developed countries like European nations and Western nations are more prominent in taking the advantage of Industry 5.0 be­ cause these societies are already attained the highest socio-economic development. A developing country like India is much lagged in human-centric technological transformation because of its socio-economic divide and imperfect physical infra­ structural transformation. Large sections of the workforce are yet to receive techni­ cal education, technical skill, and even a humane work environment. It is argued in the paper that Indian society is not yet ready for Industry 5.0 because of extremely DOI: 10.4324/9781003404682-1

2

Mahmudul Hasan Laskar

uneven technological impact, digital access, technical education, and skill. There is even a lack of proper physical infrastructure though certain cities have emerged as technologically smart. This chapter aims to examine how Industry 5.0 as a global phenomenon has an uneven impact in different parts of the world. This chapter has also focused on whether Industry 5.0 fits India’s situation and what challenges it faces in the global situation as well as in India. It analyzed India’s labor market or workforce in the context of Industry 5.0. Methods: This chapter is part of an ongoing interpretive sociological research on Industry 5.0 and its impact on Indian society. The present study employed mainly quantitative data and qualitative analysis of the cases. The study used a literature review and a case study among workers in Guwahati city of Assam state, India. For the case studies, 50 workers were interviewed to understand their overall work condition and their readiness for technical workplaces or technology-driven work environments. These workers were chosen from sec­ tors like mining, construction, manual sweeping, and manual drain cleaning based on snowball sampling.

1.2

Industry 5.0: A New Global Industrial Phenomenon

The concept of Industry 5.0 emanated from Industry 4.0, which installed new-age industrialization at the beginning of the twenty-first century. In the year 2011, the idea of Industry 4.0 developed in Germany to augment the high-tech industrial strat­ egy and as a future project for production, trade, and science. It mainly focused on economic advancement with ecological protection or “green production” that will develop green energy and eco-friendly industry. In 2013, Acatech (the German Acad­ emy of Engineering Sciences) offered recommendations for a research plan and ex­ ecution that highlighted the impact of the Internet of Things (IoT) on the organization of production. This is the interplay of machines and human workers in production and a trend toward the digitalization of manufacturing. Professor Klaus Schwab, founder and executive chair of the World Economic Forum, described that Industry 4.0 is structurally different from the preceding concept of industrialization because the advancement of technology was a priority. But Industry 4.0 mainly concentrates on the innovative doctrine of sociability and sustainability. It emphasized digitaliza­ tion and AI-driven technologies to enhance the effective and resilient production system. Industry 5.0 made the new idea that realized the importance of human and society-centric research and innovation (European Commission, 2021, p. 8). Exten­ sion of the Industry 4.0 and attempts to integrate aspects other than technology under Industry 5.0 has been a subject of debate for around four years. This debate has taken momentum trend because of the European Commission’s approach “Green Deal” or “Industry 5.0” or “Green Industry” for human-centric, social and environmentalfriendly innovation, research, and industrial policy (Banholzer, 2022, p. 8). European Commission in 2019 introduced the “Green Deal” which was a seri­ ous commitment to making a climate-neutral European Union by 2050. Certain

The Phenomenon of Industry 5.0

3

climate-neutral technologies such as electrification, green hydrogen, and biofuel were developed, but it is realized that there is a need for reeducation of non-renewable energy consumption. European Commission then started looking for adopting an industrial strategy parallel “Green deal” (Renda & Schaus, 2021, p. 2). In 2020, European Commission adopted an agenda “a new Industrial strategy for Europe,” which focused on the notions of “green” and “digital.” European Commission has the view that Industry 5.0 may lead the EU to achieve the goal of climate neutral­ ity by 2050. The European Commission sets the agenda to articulate and develop indicators covering dimensions of economic, environmental, and governance for Industry 5.0. This idea of Industry 5.0 aimed to achieve well-being (alternative measures of GDP) resilience and sustainability (Renda, 2021, p. 137). European Commission considers Industry 5.0 as a key medium of recognizing the role of in­ dustry in realizing societal goals (the primary focus of the production process is the well-being of the industrial workers apart from employment and growth), resilient prosperous system, and sustainability (production process takes into account the boundaries of our planet) (European Commission, 2021, p. 14). The European concept of Industry 5.0 (Green Deal) has the potential of re­ sponding to the question of how to find the social structural foundation of govern­ ance in the network society. Another concept of Society 5.0 was propounded by Japanese Prime Minister Abe in 2016, who suggested that the combination of In­ dustry 4.0 and Society 5.0 could bring solutions to many problems of industrialized countries (Banholzer, 2022, p. 9). The European Union commission even launched plans to support other nations with financial assistance. Some of these initiatives were Industrie 4.0 in Germany, Fabbrica Intelligence in Italy (focused on sustain­ ability, adaptive, intelligent, and high-performance manufacturing), Industrie du future in France, and Production 2030 in Sweden. Industry 4.0, in its most recent conceptual development, focused on the combination of information technology and operational technology in the production process that eventually leads to smart decision-making. So, Industry 4.0 means information and communication technology-oriented transformation of the industry to deal with and optimize various dimensions of the process of manufacturing and supply chain (Alexa, Pislaru & Avasilcai, 2022). Industry 4.0 focused on the automation that has been intimidating workers in the factory. It has many elements such as big data and analytics, simulation, horizontal and vertical system integration, cybersecurity and cyber-physical systems (CPS), cloud technologies, additive manufacturing, autonomous and collaborative robotics, and augmented reality (Banholzer, 2022, pp. 13–14). It was realized that there is a need for advancement in the industry from Industry 4.0 to Industry 5.0 in terms of sustainability and reduction of waste. The Directorate-General for Research and Innovation stated that after the deadliest pandemic, Europe is looking for building a better economy and society and making a vision plan of three vital elements, to protect, prepare, and transform. It is also looking for a better plan to deal with the greatest challenge of humanity climate change and biodiversity collapse (European Commission, 2021, p. 3). So Industry 4.0 with the objectives of automation and technical efficiency may not be suitable to meet the said challenges (Banholzer, 2022, p. 16).

4

Mahmudul Hasan Laskar

Industry 5.0 is defined on the basis of wider purposes and scopes beyond the system of production and services. The larger scope of the Industry 5.0 encom­ passes three key elements: human-centricity, sustainability, and resilience. Simply profit-oriented framework has become irrelevant today. It is important to look into environmental and societal costs and benefits instead of making a narrow focus on profit. The industry as a medium of prosperity has to take into account social, environmental, and societal factors. So, the notion of responsible innovation came into being that implies the prosperity of all: investors, workers, consumers, society, and the environment (European Commission, 2021, p. 13). Industry 5.0 focused on a human-centric approach to industrial production and prioritized the needs and well-being of the people involved instead of giving mere emphasis on technology and increasing the efficiency of technology. It is more important to what technology can do for humans not what humans can do with technology. Instead of giving importance to industry workers to adopt the skills of rapidly evolving technology, Industry 5.0 focuses on providing technology to support the workers. This idea intends to maintain human–technology reciprocal relations and does not want to intervene in the fundamental rights of workers like the right to privacy, self-sufficiency, and human dignity. For maintaining the limit in human-made development, sustainability is the ultimate necessity, which Indus­ try 5.0 has taken up as one objective. The prime idea of sustainability is to develop a circular practice, reuse, re-purpose, and recycle natural resources to minimize waste and environmental degradation. Sustainability refers to judicious consump­ tion of energy to reduce greenhouse emissions, abandon the activities of natural re­ source depletion and degradation, and most importantly ensure the needs of present generations without jeopardizing the needs of future generations. Technologies such as AI and additive manufacturing can optimize resource efficiency and reduce waste. Industry 5.0 embraced the idea of resilience in industrial production which implies a higher degree of robustness in production and preventive mechanism in case of critical situations and crises. The present global world has been facing geopolitical and natural crises, including the recent COVID-19 pandemic that led to the fragility of industrial systems. So, there must be a sufficient resilient strategy in production, business, and supply chain of basic needs of humans in the forms of security and healthcare (European Commission, 2021, pp. 14–15). Key Focus

Core principles and the key focus of the idea of Industry 5.0 can be grasped from the following explanation (Figure 1.1.): Industry 5.0 recognizes the potential of the industry to accomplish societal goals apart from employment and growth; and recognizes the capability of industry in sustainably making prosperous production system. It enables the industry to see the well-being of the industrial worker and consider them the core of the production process. (European Commission, 2021, p. 14)

The Phenomenon of Industry 5.0

Industry 4.0 Focused on enhancing efficiency through digital connectivity and artificial intelligence Technological development objectives Optimization of business model developed, which means minimization of costs and minimization of profit for shareholders

Absence of focus on negative environmental, climate, and social impacts

5

Industry 5.0 Industrial framework and strategy of combining competitiveness and sustainability that also realises its potential of being agent of transformation Technological advancement for sustainability and resilience developed Human-centric approach of technology ensures empowerment of workers through the use of digital devices Created transitional ways toward environmentally sustainable uses of technology Focus on industry's responsibility to their whole value chains Indicators developed to show for each industrial ecosystem, the progress achieved toward well-being, resilience, and overall sustainability

Figure 1.1 Evolution of industrialization Source: Banholzer, 2022, p. 22

Industry 5.0 is a future-oriented industrial strategy mainly focused on the regenerative industrial transformation that has inherent attributes of social and environmental dimensions (Figure 1.2). For European Union, Industry 5.0 approach, a new industrial strategy, addresses recent knowledge experiences from the COVID-19 pandemic and plans set to build up resilient mechanisms and secure human life and livelihood in a sustainable manner. It has the aim of providing a more resilient system to overcome future disasters and shocks and to integrate social and environmental dimensions that Industry 4.0 overlooked (European Commission, 2021, p. 7). Industry 5.0 identified six enabling technological developments (Table 1.1, Banholzer, 2022, p. 23): • Technologies of individualized human–machine interaction to integrate the strength of humans and machines. • Bio-inspired technologies and smart materials were developed to facilitate resources with entrenched sensors and better features to be recyclable. • Digital twin and simulation technologies to form whole systems.

6

Mahmudul Hasan Laskar

Humancentric

Industry 5.0 Resilient

Sustainable

Figure 1.2 Focus of Industry 5.0

Source: European Commission, 2021

Table 1.1 Industrial paradigm Industrialization Industry 1.0 Workers

Technology

Industry 2.0

Industry 3.0

Industry 4.0

Industry 5.0

Manual work

ComputerWorkers trained Same as 3.0 and Workers trained assisted work for digital began pattern to work with transformation of 5.0 augmented technologies Age of Age of Age of Age of smart Age of cyber­ mechanization electrification Digitalization manufacturing physical systems

Source: Crnjac Zizic et al., 2022, Energies

• Transmission of data, storage, and analysis technologies to deal with data and system synergy. • Artificial intelligence detects side effects in complex and dynamic systems that lead to functional intelligence. • Technologies for eco-friendly energy production, storage, and autonomy.

The Phenomenon of Industry 5.0 1.3

7

Industry 5.0 and Global Trend of Transformation

Industry 5.0 has instituted transformation in various realms such as manufacturing, healthcare, education, food, textile, and others. One of the major transformations that brought about the new-age revolution is smart manufacturing. Industry 5.0 initiated an innovative production system by integrating machines and humans. Now affords have been going on to establish collaboration among machines and the innovative potential of the human workforce. The target is to make manufactur­ ing sustainable, so Industry 5.0 developed a system of recycling resources to avoid environmental damage. It has taken away the repetitive work of humans. Smart robots and systems have led to the highest upgradation of manufacturing shop floors and supply chains (Adel, 2022, pp. 5–6). Industry 5.0 has also focused on making smart hospitals through various creative applications. The smart hospital ensures real-time capability. Remote monitoring system developed by Industry 5.0. Under this new industrial strategy, machine learning (ML) has made use of medi­ cal imaging, natural language processing, and genetic data. The focus is on smart technological intervention in the process of diagnosis, detection, and prediction of diseases. Medical specialists are now embracing artificial intelligence technol­ ogy to measure various problems. It also led to the manufacturing of personalized smart implant properties, medical devices, and tools. These technologies are very useful for performing surgery (Adel, 2022, pp. 5–6). Another important area that was transformed remarkably by Industry 5.0 is supply chain management. Robots make it possible to establish a consistent and uninterrupted mechanism of the sup­ ply chain in the form of selecting raw materials and figuring out the personalization and customization of the needs of consumers. Hyper-personalization is enabled by human intelligence empowered by cognitive computing and intelligent automa­ tion. The technologies such as machine learning, robotic automation, and others are serving employees to augment business skills and ensure the satisfaction of customers. Industry 5.0 further developed a digital supply chain that provides cus­ tomization of the supply chain, customer satisfaction, an efficient organization of business, and market limitations (Adel, 2022, pp. 6–7). Globally, Industry 5.0 has brought smart transformation and advancement in terms of human-centric techno­ logical innovations, sustainable technological advancement, and resilient industrial mechanisms. If this industrial strategy is adopted principally, workers will never be replaced by technology and society will be secured from technological disaster. Amr Adel (2022) stated that the enabling technologies related to Industry 5.0 are cloud computing, blockchain, analytics of big data, IoT, and 6G networks (Adel, 2022, p. 6). These technologies fundamentally transformed the work environment, production process, and market network. Industry 5.0 redefined labor or workforce with a new narrative and concepts. New narratives of Industry 5.0 describe labor or workforce as an investment posi­ tion instead of cost, which ensures the well-being of both company and workers. The industry now focuses on investing in the skills, capabilities, and well-being of the workers to accomplish goals. It replaced the old idea of equating labor or worker as a mere cost of production. Industry 5.0 has the aim of creating an

8

Mahmudul Hasan Laskar

industrial system where technology serves people. Manufacturing technology must meet the requirements of the workers instead of workers’ continuous adaptation to ever-evolving technologies. To attain this working condition, workers need to be part of the design and deployment of new industrial technologies like robotics and AI (European Commission, 2021, p. 15). Industry 5.0 instituted the system of collaborative robots that changed the idea of working humans and robots inde­ pendently promoted by Industry 4.0. Industry 5.0 aims to develop a system where highly skilled humans and AI robots work together to generate personalized and customized products. Humans and robots used to work individually and indepen­ dently in Industry 4.0. There was a clear demarcation of work between humans and robots though they had a common station of work. But Industry 5.0 blurred this demarcation, and its endeavor is that the intelligible skills of the human brain can be accompanied by robots. In short, we can say collaborative robots or “cobots” are a fundamental element of Industry 5.0 and smart factories. Cobots have ensured the collaborative work of human–robot and robots may assist humans. User-friendly cobots provide real-time technical assistance to humans and carry out unpleas­ ant and risky activities. Another real-time technology and data-driven innovation instituted by Industry 5.0 are “Shop floor Trackers,” which can keep track of the production process in real time. This is useful for the reduction of waste material and mismanagement (Bhandurge & Bhide, 2021, pp. 2–3). Robots make the work­ place safer and ensure the simplest way of completing work. The worker can take the help of AI and other smart technologies instead of going for specific training for specialized tasks. AI-based technological tools help workers undertake specialized tasks. Physically hard tasks are now carried out by mobile robots and exoskeletons. Women can participate more in these tasks which were earlier limited to men due to the requirement of physical strength. Digitalization further developed the system of remote work that allows workers to perform their duty from distant locations (European Commission, 2021, p. 17). Industry 5.0 through an open global phenomenon is more suitable for developed countries because they have already achieved technology-driven societal and eco­ nomic transformation. Societal development of these countries is well maintained in terms of capability and access of people in the realms of education, work, skill, living standard, the digital world, and the new smart society. India has a serious problem of societal and economic divide in education, work, income, skill, and digital access. The digital divide further augmented the grave problem. Human– robot integration and interaction are emphasized in Industry 5.0, but India is yet to develop human-centric technological adaptations in many sectors such as coal mining, construction, agriculture, street sweeping, and drain cleaning. There is a lack of technical skills among large sections of people in India because of low edu­ cational attainment. There are about 8% of graduates in India, out of which only technical graduates have market demand in technical fields. So their skill enhance­ ment may be undertaken but workers who are in informal sectors cannot adopt the technology and cannot even get the opportunity to skill themselves for upgrading their status in growing industrial fields. This issue is discussed in the following sections in detail.

The Phenomenon of Industry 5.0

9

Though officially, it has not yet been adopted in India, a certain trend of trans­ formation was instituted as part of Industry 4.0. The major means of transforma­ tion is digitalization. Digitalization has fundamentally transformed the consumer market. People’s digital presence is quite well but when it comes to education, job, income, and business, digital access is still limited. The work environment in the sectors such as mining, construction, and factory production is still vulnerable to manual workers or informal workers. Fatal risks are associated with the nature of work performed by manual workers or informal workers. Why there is yet to cre­ ate an environment of Industry 5.0? A critical analysis of the transformation trend in India needs to be highlighted. Human–machine integration is the key focus but here major sections of the human population are out of work. Sociologically speak­ ing, this transformation is one-sided and has caused advantages for developed na­ tions because they have already an educated and knowledgeable population as a workforce. But in India, a small section of technical professionals and a large sec­ tion of informal workers constitute the workforce. Technical skilling is going on for those who are technical graduates and already working in the fields of artificial intelligence, robot technology, information communication, automation, digital business, and the service industry. There is a very low improvement or upgradation of the manual worker’s life situation. Questions arise if Industry 5.0 is adopted in principle, whether it would be able to bring transformation in such a society with a wide education gap, skill gap, and uneven economic conditions. 1.4

Is Indian Society Ready to Adopt Industry 5.0?

India is still in the transitional phase of adopting Industry 4.0. There is also the question of whether India is ready to implement Industry 4.0. Since Industry 5.0 is the extension of Industry 4.0, we may look into India’s readiness for Indus­ try 4.0, which will provide a relevant assessment. The major nine technological components that constituted the foundation of Industry 4.0 are autonomous robots, big data, augmented reality (AR), additive manufacturing, cloud computing, cy­ bersecurity, IoT, system integration, and simulation. Industrial strategy augmented the advancement of technology that created global connectivity smarter than ever before among people, businesses, and the market. This trend is getting accelerated over time (Grant Thornton, 2017). World Economic Forum (WEF) assessed the Network readiness among all the countries and made an index based on the net­ work readiness of various countries. India’s position in the index and its compari­ son with developed and neighboring countries are highlighted here. Network readiness is a key indicator of assessing a country’s performance in the digital world (Figure 1.3). The world is growing toward a more networked system, so a country must perform for a better economy and society. The network readiness Index shows the performance of the countries in the digital world (Figure 1.4). It measures whether countries possess the drivers essential for digital technologies to meet up their potential and makes sure to what extent technologies affect the economy and society. India’s rank in the Network Readiness Index has gone down from 61 in 2013 to 91 in 2016 (World Economic Forum, 2016).

10

Mahmudul Hasan Laskar

Drivers Infrastructure

Readiness

Affordability Skills

Environment Individual

Usage

Business Government

Economic

Social

Impacts Figure 1.3 Network readiness framework consists of drives and impacts Source: Breene Keith (2016), World Economic Forum

It has been very clear from the report of the World Economic Forum that there is a wide gap between developed and developing nations based on the digital econ­ omy. Developed countries such as the United States and Singapore which topped the ranking are performing consistently well but developing countries like India dropped in ranking over time. The readiness for Industry 4.0 and digital technolo­ gies varies from developed to developing nations (World Economic Forum, 2016). According to Network Readiness Index 2021 by the Portulans Institute, India ranks 67th out of the 130 economies included in the NRI (Table 1.2). The Index model is very diverse and inclusive:

The Phenomenon of Industry 5.0

11

Network Readiness Index

Technology

People

Governance

Impact

Access

Individuals

Trust

Economy

Content

Business

Regulation

Quality of life

Future Technologies

Governments

Inclusion

SDG Contribution

Figure 1.4 Framework of network readiness index Source: Portulans Institute, 2021

India’s network readiness in different domains is presented in Table 1.3. Data show that India’s network readiness is the poorest in quality of life, individual life, SDG contribution, and inclusion. There is a disparity in the access to the network or the advantage of the digital world. India’s performance is very deplorable in this aspect. Digital India policy was introduced by the Government of India to transform the economic infrastructure, which is a way forward toward Industry 4.0. The Digital India program has the objective of transforming India into a digitally empowered society and knowledge economy. Eventually, it comes to the notice of sociological discourse that there is a wide digital divide in India. The emergence of the digital divide is large because of the prevalent socio-economic divide in India. The trend of the digital divide in India at the time of globalizing Industry 5.0 is a serious is­ sue that needs to be critically analyzed through a sociological lens. The prevalent socio-economic disparity is further reinforced by the digital divide in new India. The digital divide is defined as inequalities between the digital haves and have-nots in terms of their access to the internet and the ICTs. Different indicators are used

12

Mahmudul Hasan Laskar Table 1.2 Ranking of selected countries in network readiness index Network Readiness Index Countries

Global rank

Singapore Finland Sweden Norway United States Netherlands Switzerland United Kingdom Luxembourg Japan Hong Kong SAR Korea, Rep Canada Germany Malaysia China Thailand Sri Lanka India Pakistan

1 2 3 4 5 6 7 8 9 10 12 13 14 15 31 59 62 63 91 110

Source: World Economic Forum, 2016

Table 1.3 India’s rankings by sub-pillar in network readiness index Sub-pillar

Rank

Economy Access Governments Future Technologies Content Trust Businesses Regulation Quality of Life Individuals SDG Contribution Inclusion

24 40 46 56 63 70 76 84 92 93 95 99

Source: Portulans Institute, 2021

to measure the digital divide such as availability, affordability, and digital literacy. Dimensions like usage and physical access can measure availability and affordability. There is a grave digital divide in India in internet use and access to digital infrastructure based on rural–urban, gender, caste, and age. According to ITU’s

The Phenomenon of Industry 5.0

13

World Telecommunication/ICT indicators database, 43% of India’s total popula­ tion uses the internet. There also exists a gender gap in internet usage. Data show that 58% male population uses the internet and 42% female population uses the internet. According to the GSMA report, 79% adult male population and 67% adult female population own a mobile phone in India (Chandola, 2022). Digitalization has affected the employment scenario in India in both positive and negative ways. Only 8.15% of Indians are graduates as per census 2011 (Census, 2011). India after 2011 saw a major shift in technological infrastructure and structure of the economy because of the impact of Industry 4.0 and then recently Industry 5.0. Census data showed a remarkable increase in technical graduates but still, the proportion is very negligible in number in terms of workforce and making up of good human resources. Presently, India is undergoing a major reformation of employment in formal as well as informal sectors due to rapid globalization, technocratic marketplaces, and data­ based businesses. Digital transformation in the last decade affected employment on a mass scale. There emerged many new employment opportunities with technical skills. The new globalized advanced technological environment has transformed organizational structures and operations. New technology-driven business models emerged such as Byju’s, Ola, Swiggy, Oyo, Lenskart, CRED, Myntra, and numer­ ous others. It is now realized that a knowledge-driven human resource is required to connect India with the global platform. The government has taken up many plans and programs to reskill and upskill the people. The scientific community also has been working on developing robotics, artificial intelligence, and machine learning for adopting a global industrial strategy. Digitalization of the market and technology-based network of consumer and goods market instituted a new consumer society in India (Figure 1.5). Highly required education today in the industrial organization is a technical qualification, skill, and experience. In India’s hiring trend, high demand is there for Pharma & Healthcare, Engineering & manufacturing, and energy sector. There is a high market value of engineering graduates because of the growing IT sector, Internet business, automotive sector, and other industries. Graduates have market value based on the condition of knowledge-oriented busi­ ness systems in industries. Transformation in work culture instituted by advanced technological environment focused mainly on technical skills. Highly demanded technical skills are Python programming, neural networks, cloud computing, supply chain, and general statistics. Owing to the requirement for a technology-driven business model and technological shift in company infrastructure, organizations are now looking for skilled professionals. Automation of the supply chain has resulted in increasing demand for knowledgeable and skilled workers in many industries. Thus, for industries to sustain themselves, qualified professionals are recruiting the most (India Skills Report, 2021). But another crucial phenomenon that needs sociological attention is workers in the informal sector and manual workers who are out of the technology-driven organizational network and technically skilled workforce. The informal workforce in India includes those working in private enterprises of individuals or households, daily wage laborers, domestic helpers, and manual laborers in the formal sector who work without any socio-economic security and benefits. India’s employment

14

Mahmudul Hasan Laskar Digitalization in India

Technological Trasformation

AI, Automation and Digital Service

Smart consumer society

Societal and Economic Impact

People

Technically skiled

Manual and Informal worker

Socialeconomic affluence of few

Inacpability of large population

Figure 1.5 Digitalization and India’s way forward in Industry 5.0 Source: Result of field study, 2022

trend is largely informal. The total employed in India is 461.52 million, out of which 415.23 million are in informal employment. So out of total employment, 90% of men and 92% of women are informally employed. The education of the workers in the informal sector is very deplorable. Educational attainment is very low among domestic laborers, street vendors, sweepers, and manual construction workers. More than 60% of women and 35% of men among these workers have dropped out of primary school (Raveendran & Vanek, 2020, pp. 2–3). It is stated that Industry 4.0 implementation strategy needs a strong welfare state (Buhr, 2019, p. 115). Social democratic welfare states like Nordic countries are better prepared in taking on the challenge of Industry 4.0 than liberal, Mediterranean, post-socialist, and conservative welfare states (Buhr, 2019, p. 116). Nordics have the policy to focus more on the public sector and public services instead of dependency on commercial interests (Buhr, 2019). But welfarism in India is not able to ensure public services equitable and suf­ ficient for all. We can here propose Amartya Sen’s capability approach (Sen, 1999) for uplifting the lower sections. People must have the capability in access to the digital world, technical education, technical skills, and technology usage. The state may adopt human-centric technological infrastructure to provide a safe work en­ vironment but educating people to equip them with the smart work system is even more important. Networking, cloud computing, and digital business model have been growing exponentially in India but are limited to a small urban populace. Large rural populations, urban poor, and informal workers are still engaged in physical labor, which is less productive and riskier. Sociological Analysis of India’s Readiness for Industry 5.0 India has adopted digitalization that eventually led to industrial digitalization for the smart organization of corporate. India showed great progress in industrial dig­ italization, particularly in the service sector. We see India’s noteworthy shift in business, market network, and consumerism. It can be argued that the untimely

The Phenomenon of Industry 5.0

15

adaptation of Industry 5.0 may lead to the alienation of manual and informal work­ ers. Indian society has to be ready with the equitable socio-technological condi­ tions required for Industry 5.0. The most essential part of the industry is the worker, which has a major section in manual and informal work. Manual workers have deplorable work conditions, education, skill, and quality of life. To understand the phenomenon, a case study was conducted among the mining laborer, construction workers, street sweepers, drain cleaners, and toilet cleaners from Assam, India. Physical Work Condition

Physical work condition in mining site is extremely risky and vulnerable. Work­ ers go into the rat hole in the coal mine site located at various hill tracts of Assam. Most of the coal mining sites are deep well-like platforms, which have many small holes called “rat holes” inside the well. Laborers go deep into the well-like under­ ground platform and cut the coal with the axe and other tools. There is no machine used in mining. Workers are fully engaged with physical strength to carry out this work. Even they carry back coal buckets from deep down to the outside. They use a certain rope-made stairway to climb down to the surface of the well. They often face life risks due to fatal accidents and landslides inside the well. Apart from min­ ing workers, construction workers perform hard physical labor on the construction sites though certain technological interventions make it easy. They shared that the physical condition of their work is risky, unhealthy, and below standard. Working hours are customized by the contractor of the work. Street sweepers’ drains and toilet cleaners constitute another very distressed category, which hardly gets any at­ tention due to their unorganized work environment. Every city has these sections of workers who perform degraded jobs yet are immensely significant. It is degraded because they do all the dirty and unclean work of sweeping, and cleaning the drain, roads, public places, and toilets physically without any technological intervention. They are like outcasts with whom other does not maintain physical and social prox­ imity. They even live a very low living standard. Wage of the workers: The wage of these aforementioned categories of workers is usually fixed by the contractors. They receive wages mostly on weekly basis except for some exceptions. Workers do not get any other social and economic security and facilities. Their wage is not even sufficient to maintain basic needs like food, shelter, and clothing. Education and health are beyond their capabil­ ity, so their access is limited. Skill of the workers: They do not have any technical skills since their highest education is primary (class VIII). Physical labor is their only asset, which they use to earn a livelihood. These workers have not even received any skill train­ ing because of their low education, unawareness regarding technical work, and lack of opportunities. They shared that all of their co-workers are engaged in physical labor only. The whole day they work, so do not get any time to even think about upskilling themselves. Sweepers and drain cleaners are most vul­ nerable in terms of health, income, and social status. These workers may be

16

Mahmudul Hasan Laskar

upskilled by incorporating robot and automation technologies for sweeping and cleaning jobs. In Indian society, sweeping and cleaning jobs are considered so­ cially degraded and impure, so a societal stigma gets attached to the occupation. Technology-driven work systems may end this age-old narrative and empower workers toward a dignified profession. Standard of living: Workers’ living standard is extremely poor. They live in urban slums and labor colonies in their work sites. Workers are excluded from their rights to privacy, dignity, education, proper health, and cultural setting. Their struggle for morning toilet calls and drinking water proves the fact that poor living standards. Workers live a life much different than mainstream society. So technology and smart work are just beyond their imagination, so we can­ not expect a smart society by excluding a major section in grave distress and vulnerability. Digital access: These workers own smartphones, but internet use is limited. Their internet consumption trend is mainly in watching films, videos, music, and other entertainment content. They have awareness regarding Google pay and Pho­ nePe but are less comfortable in use. Another problem is a lack of sufficient amount in their bank account. Their payment of wages is made in cash, and it generally spends on daily expenditures, so nothing is left for saving. Their children are out of digital education because they do not know about handling online education; they lack the capability in accessing the internet all the time and lack of capability in spending on digital education apps. The workers even face problems of taking many health benefits from the government due to their poor knowledge of digital processes. 1.5

Challenges of Industry 5.0

Industry 5.0 is obstructed by certain challenges, which may be technical, indus­ trial, and social. Industry 5.0 is no doubt a progressive future-oriented industrial strategy, but it poses certain societal challenges particularly for developing so­ cieties. In India’s situation, we find diverse societal stumbling blocks for Indus­ try 5.0. Simply adopting Industry 5.0 is not sufficient rather enabling humans for working with technology has to be initiated with utmost priority. Certain technical challenges are discussed later and followed by a sociological analysis of the challenges. The challenges of Industry 5.0 also include (Adel, 2022, p. 9): 1. Technical skill and competency for the people: It is a great challenge in the era of Industry 5.0 that people need to develop competency and skills for working with advanced robots and smart machines. Present jobs require high technical skills and efficiency in industrial robot programming and managing smart ma­ chines. The technical skill of the workers is a major issue that poses a challenge for Industry 5.0. 2. Adoption of advanced technology is time taking for human workers: For hu­ man workers, adopting advanced technology is a huge challenge that needs time

The Phenomenon of Industry 5.0

17

and enormous effort. Workers in Industry 5.0 now need to adopt personalized software-connected factories, collaborative robotics, artificial intelligence, realtime information, and the internet of things. 3. Investment required for advanced technologies: Advanced technologies of Industry 5.0 is very expensive. Preparing a workforce by training workers in advanced technologies further increases the cost. Companies are now facing a challenge to upgrade their production by following Industry 5.0. So adoption of Industry 5.0 is costly for companies and states as it requires smart machines and a highly skilled workforce for better productivity and high efficiency. 4. Security Issue for Industry 5.0: Industry 5.0 faces a security challenge as it is vital to develop trust in ecosystems. People face the issue of authentication in devices. Moreover, business and market network should be more secure because artificial intelligence and automation in Industry 5.0 pose threat to it. Industry 5.0 focuses on the applications of ICT systems, so chances of security disrup­ tions occur. In India’s situation, the greatest challenges for Industry 5.0 are the technical skill of the workforce, poor educational attainment of the population, physical infra­ structure, and the socio-economic divide. If there are only 8% of graduates in the population, how can we expect automation and AI in the workplace? Around 90% of the total workers are engaged in manual or informal work, so they are out of technology-driven work systems. In this case, only a section of the workforce takes up advantage of digitalization, automation, and technology-driven work systems. Physical infrastructure like road connectivity between rural–urban areas, internet connectivity, particularly in rural areas, rural healthcare network, and market net­ work between rural–urban and smart agricultural markets are yet to achieve the milestone set for industrial society or Industry 3.0 and Industry 4.0. Computer, internet, and digital literacy are still poor in India though certain improvements are going on. Large sections of the village population are still illiterate about Google, Gmail, Websites, Apps, and online businesses. 1.6

Conclusion

It can be concluded that India is not ready for Industry 5.0. Industry 4.0 is yet to achieve by India inclusively. Globally, Industry 5.0 can be a leading indus­ trial strategy for a sustainable future for the earth. Human-centric technological advancement like Cobot is a remarkable idea that has the potential of transforming the work environment and human resource utilization. The digital business model is another prospering field, which will surely pull greater numbers of people in the process of market networking and entrepreneurship. It can be argued that In­ dustry 5.0 legitimizes the power of consumer society. India has grave issues such as the social divide and the digital divide. Certain metro cities have emerged as smart cities and hubs of AI, automation, cloud computing, and robotic technolo­ gies. Many regions are out of this technological advancement. Rural areas are most backward in this process. The main issue in India is workforce utilization, skill,

18

Mahmudul Hasan Laskar

and efficiency. The workforce is mainly engaged in manual and informal jobs, so they lack technical skills and efficiency. Socio-economic inclusion, digital inclu­ sion, higher educational attainment, and upskilling would work to empower society toward Industry 5.0. 1.7.

References

Adel, Amr (2022). Future of Industry 5.0 in Society: Human-centric Solutions, Challenges and Prospective Research Areas. Journal of Cloud Computing: Advances, Systems and Applications 11: 40. https://doi.org/10.1186/s13677-022-00314-5 Alexa, Lidia, Pislaru, Marius & Avasilcai, Silvia (2022). From Industry 4.0 to Indus­ try 5.0-An Overview of European Union Enterprises. In: A. Draghici and L. Ivascu (eds.). Sustainability and Innovation in Manufacturing Enterprises. Advances in Sus­ tainability Science and Technology (pp. 221–231). Singapore: Springer. https://doi. org/10.1007/978-981-16-7365-8_8 Banholzer, Volker M. (2022). From Industry 4.0 to Society 5.0 and Industry 5.0: Value- and Mission-Oriented Policies: Technological and Social Innovations-Aspects of Systemic Transformation (IKOM WP Vol. 3, No. 2/2022). Nurnberg: Technische Hochschule Nurn­ berg Georg Simon Ohm. Bhandurge, Gauri Malhar & Bhide, Mrunmayi Shirish (2021). Industry 5.0: The Conver­ gence of AI and HI (Human Intelligence). Research Square. COEP: Government College of Engineering. https://doi.org/10.21203/rs.3.rs-693806/v1 Breene, Keith (2016). What Is ‘Networked Readiness’ and Why Does It Matter? World Economic Forum. https://www.weforum.org/agenda/2016/07/what-is-networked­ readiness-and-why-does-it-matter/ Buhr, Daniel (2019). Why Do Smart Factories Need Smart Welfare States? Perspectives from Four European Countries and Regions. In: Bürkhardt et al. (eds.). Smart Factory and Digitization (pp. 99–118). Germany: Nomos. doi:10.5771/9783845288093-99 Census India (2011). https://censusindia.gov.in/census.website/ Chandola, Basu (2022). Exploring India’s Digital Divide. Observer Research Foundation. https://www.orfonline.org/expert-speak/exploring-indias-digital-divide European Commission (2021) Industry 5.0 Towards a Sustainable, Human-centric and Resilient European Industry. European Union. Brussels. https://doi.org/10.2777/308407 Grant Thornton (2017). India’s Readiness for Industry 4.0 a Focus on Automotive Sec­ tor. Confederation of Indian Industry. https://www.grantthornton.in/insights/articles/ indias-readiness-for-industry-4.0--a-focus-on-automotive-sector/ India Skills Report (2021). Wheebox Talent Assessments. Confederation of Indian Industry (CII). https://wheebox.com/india-skills-report.htm Portulans Institute (2022). Network Readiness Index 2021 India. https://networkreadi­ nessindex.org/ Raveendran, Govindan & Vanek, Joann (2020). Informal Workers in India: AStatistical Profile (Statistical Brief No 24). 1–15. Women in Informal Employment: Globalizing and Organ­ izing. UK. https://www.wiego.org/publications/informal-workers-india-statistical-profile Renda, Andrea (2021). The EU Industrial Strategy: Towards a Post-Growth Agenda? Intereconomics 56: 133–138. https://doi.org/10.1007/s10272-021-0968-7 Renda, Andrea & Schaus, Malorie (2021). Towards a Resilient and Sustainable PostPandemic Recovery. Brussels: CEPS Task Force on the New Industrial Strategy for Europe. Centre for European Policy Studies (CEPS).

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Sen, Amartya (1999). Development as Freedom. New York: Alfred A. Knopf. World Economic Forum (2016). The Global Information Technology Report. Innovating in the Digital Economy. https://www.weforum.org/reports/the-global-information­ technology-report-2016/ Zizic, M. C., Mladineo, M., Gjeldum, N. & Celent, L. (2022). From Industry 4.0 Towards Industry 5.0: A Review and Analysis of Paradigm Shift for the People, Organization and Technology. Energies 15(14): 2–20. https://doi.org/10.3390/en15145221

2

Advantages and Disadvantages of Industry 5.0 in the TwentyFirst Century Simona Bigerna, Silvia Micheli,

and Paolo Polinori

2.1

Introduction

The new paradigm promoted by the European Commission is Industry 5.0, through which industrial activity that goes beyond technical and economic objectives such as productivity and efficiency is encouraged. Industry 5.0 also seeks to encourage other essential aspects for the future of the sector, such as human well-being, sus­ tainability, and resilience. Industry 5.0 gives industry a fundamental role, capable of achieving social objectives that go toward the growth of sustainable economy and society. In this way, productive systems must take into account the limits of the land and give priority to the physical, social, and economic well-being of the work­ ers (Akundi et al., 2022). In January 2021, the European Commission publishes a policy brief with the aim of defining Industry 5.0 and thinking about the policies to be implemented to support its development (European Commission, 2021). While Industry 4.0 is intended as the use of technology with the aim of optimizing tech­ nological production, Industry 5.0 is the paradigm according to which the Smart Systems of the fourth industrial revolution connect with man. The EU establishes the three axes around which Industry 5.0 develops, which are human-centricity, sustain­ ability, and resilience. The EU document in this regard establishes the central role of companies that can undertake development paths in which both workers and natural resources are maximally respected. The social function of firms is therefore recog­ nized, as well as the possibility to be the engine of change in productive systems. Fur­ thermore, as it emerges from a recent policy paper (European Commission, 2022), the Industry 5.0 industrial strategy highlights resilience, sustainability, and circular economy, and must overcome short-term overproduction and consumption patterns determined by the current growth paradigm. Industry must become the protagonist and be the engine of systemic transformation and planetary regeneration. The new paradigm of Industry 5.0 must provide for the regeneration of resources as a key pil­ lar of the design of the entire production and supply chain; a social dimension that embraces the well-being of workers, which is inclusive; a mandatory environmental dimension that builds new ways of creating prosperity while respecting the interde­ pendence with natural systems. In this chapter, we have first explored the popularity of the terms we surveyed related to Industry 5.0, using Google Trends. Focusing on the sustainability and resilience dimensions for economy and society, we have DOI: 10.4324/9781003404682-2

Advantages and Disadvantages of Industry 5.0 21 reviewed the literature in order to investigate both the advantages and disadvantages of Industry 5.0. We have used the most cited papers related to the research topics in the Scopus scientific database. The advantages for businesses and workers are several and range from improved talent acquisition and retention to energy savings and increased productivity, greater flexibility, readiness for change, and a responsive work environment. This means that, in the long run, the sustainability, profitability, and productivity can be reached by the industry. We will examine how the concept of Industry 5.0 will be a harbinger of benefits for society as a whole, respecting the lim­ its of the resources of the planet and of society itself. Despite all the advantages of Industry 5.0, economy and society will face risks associated with it. In this chapter, a detailed analysis in terms of disadvantages that emerge with Industry 5.0 is shown, especially in the short run, from the impact on the world of work to the effects on competitiveness. The purpose of this chapter is to initiate broader reflections on Industry 5.0, focusing on the related benefits and risks, to better manage the impact of new technologies and the risks associated with them on the well-being of the com­ munity. This chapter is structured as follows. Section 2.2 presents an overview of the popularity of Industry 5.0 within scholars and academics, and Section 2.3 describes Industry 5.0. Sections 2.4 and 2.5 describe the advantages and disadvantages of In­ dustry 5.0, and the conclusions are drawn in Section 2.6. 2.2

On the Popularity of the Latest Industrial Revolutions: A Brief Premise on the Attention Paid by Scholars and Academics on the Industrial 5.0 Revolution

The latest two industrial revolutions (Industry 4.0 and 5.0) are characterized by several differences. As highlighted by policy reports and government documents, on the one hand, the integration of several new technological dimensions such as IoT, AI, cyber-physical systems, Cloud, and cognitive computing is the core of the Industry 4.0. Consequently, in the manufacturing sector, Industry 4.0 has especially deployed the smart factory, spurring the role of the technology within the sector to guarantee the interconnectedness of machines and systems achieving the optimum performance and improving efficiencies and productivity. On the other hand, In­ dustry 5.0 aims to strengthen both machine and worker roles emphasizing worker creativity and responsibility and increasing the role of supervisor in order to obtain higher quality and less massive products. Consequently, the expectations are that Industry 5.0 should create higher-value jobs given that workers’ design responsi­ bility and creativity should be in high demand. Nevertheless, there was a certain skepticism about the Industry 5.0. How much academics and scholars share these expectations could be a useful research question (RQ) at the beginning of this new revolution. In our approach, this RQ involves four steps: (i) we investigate the relative popularity of the main terms associated to the latest industrial revolutions in a comparative way; (ii) we investigate the popularity of the main keywords and concepts associated to the Industry 5.0; and (iii) we analyze what are the most cited original works and literature reviews Industry 5.0 and the research topics covered by these papers in terms of advantage and disadvantages.

22

Simona Bigerna, Silvia Micheli, and Paolo Polinori

2.3

Industry 5.0: A Deep Systemic Transformation

The interest in the literature around Industry 4.0 has grown exponentially in recent years in business and management, social sciences, and economics fields, but more in general it is also popular among practitioners and institutions. The object of Industry 4.0 is the digital production and business management model, and value creation processes, which involves the use of machinery con­ nected to the Internet (Internet of Things), collection and analysis of information to activate learning machine processes, the possibility of a more flexible manage­ ment of the production cycle and improvement of the interaction between man and machine. The object of Industry 5.0 is getting a sustainable, human-centered, and resilient industry, and in this context, industry plays a key role through the figure of the worker whose well-being is the primary objective of the industry itself. New technologies will have to respect the limits of the planet’s resources while providing jobs and growth. Summarizing, the technologies present in Industry 4.0 are enriched toward a path of sustainability, in which human well-being is at the center of development, and the industry is able to face events with flexibility and mobility. Before describing Industry 5.0 and its advantages and disadvantages, it is worth making a very brief reconstruction of what previous industrial revolutions have represented over the years (Yavari and Pilevari, 2020). The first industrial revolution conventionally dates back to the invention of a series of machines aimed at speeding up the production of yarns. These innovations had a very important impact on productivity, understood as the ability to produce a certain quantity of product for the same number of man-hours. The second industrial revolution is linked to the invention and the consequent industrial application of electricity. It was a process that, just as in the case of the first revolution, took several decades to reach full maturity and unfold its potential. In the sixties and seventies of the twentieth century, the third industrial revolution has been characterized by the ad­ vent of computers and the spread of automation based on electromechanical and then electronic systems. These are the years, for example, of the outsourcing of the economy, but also those of the Toyota Production System and lean manufacturing, issues that are still very topical today. Industry 4.0 has appeared in 2011. The following year, the modalities for the real implementation of Industry 4.0 were formally drawn up in Germany to undertake a technological change so that the companies that operated in manufacturing became completely digitized. When the digital technologies applied to the manufacturing sector and Industry 4.0 are considered, also the expression Smart Manufacturing occurs, running on two converging tracks. On the one hand, there is the German government program, and on the other, an American initiative titled Smart Manufacturing Leadership Coalition, which in 2012 united manufacturing companies, research bodies, universities and producer organizations in the research and development of standards, platforms, and shared infrastructures. The two processes are distinct but have contributed to spreading a single paradigm of Industry 4.0. Starting from 2015, the concept begins to be ef­ fectively known and applied by companies (Resende et al., 2021).

Advantages and Disadvantages of Industry 5.0 23 In this context, factory has been seen as the place where the so-called cyber­ physical systems, that is, physical systems integrated with computer systems, oper­ ate. Industry 4.0 aims to make production smart, that is, flexible and autonomous, and products increasingly connected and personalized. To do this, it uses a series of enabling technologies, many of which are already available, including augmented reality, cloud, intelligent and collaborative robotics, and cybersecurity. At the ba­ sis of Industry 4.0, there is a widespread sensorization of production systems and products. The technologies already exist but are reaching maturity and at a price level such as to allow a widespread diffusion (Bajic et al., 2020). 2.3.1

From Industry 4.0 to Industry 5.0: The Role of the Society 5.0

In many Western countries, the principles of Industry 4.0, a term used for the first time in 2011 in Germany, are now reaching a certain level of maturity, but the tech­ nological transition is still an ongoing process. Although the advent of Industry 4.0 is so recent, there is already talk of Industry 5.0. This term was actually anticipated in Japan by that of Society 5.0 that goes beyond the total digitization of manufacturing processes and indicates a model of society that represents the last stage of civilization (Narvaez Rojas et al., 2021). It is 5.0 because it follows the hunter–gatherer, agricultural, industrial, and information societies. The importance of digital is confirmed in Society 5.0, but it must go exclusively toward sustainable development, with positive effects on mobility, reduction of pollution, and inequalities. The Japanese public authorities are configuring a soci­ ety in which digital is at the service of man in all economic and social sectors, from tourism to healthcare (Deguchi et al., 2020). The prerequisite is the challenge posed by the fact that it is not just manufactur­ ing technologies that change, but the entire business context. Society 5.0 strictly refers to the concept of social innovation. The effectiveness of technology and new business models is measured by posi­ tive changes in people’s lives and the creation of shared value. Society 5.0 con­ siders the use of technology at the service of man and his needs. This is true not only in the sphere of production and economics but also in the fields of medicine, research, and all activities that contribute to social well-being. Nature and technol­ ogy become allies in the sense that automation, internet of things, big data, and artificial intelligence can be the tools to improve the quality of life. The mission is, therefore, to create a more sustainable society where everyone can have a safe and fulfilling life. The Society 5.0 model, conceived and developed in Japan, is a concept that is also taking hold in the rest of the world to improve the integration between man and machine. The idea was then recently transferred from Society 5.0 to Industry 5.0. In particular, the pandemic has caused questioning related to the working methods, underlined the vulnerability of the industry, and the need for flexibility to cope with it. At the same time, many have questioned the role of modern industry in society: starting from the issue of environmental impact, up to the transformation of work and workers, a consequence of emerging technologies (Huang et al., 2022).

24 2.3.2

Simona Bigerna, Silvia Micheli, and Paolo Polinori The Industry 5.0 Revolution

Industry 5.0 was called into question when the evolution in a collaborative key of robotics was highlighted, when human-centered technological models are dis­ cussed, and when the very important dimension of environmental and social sus­ tainability arises. A core concept of Industry 5.0 is that technology serves people. This implies that workers are no longer seen as a cost but represent a resource for companies to grow professionally within the companies themselves (Nahavandi, 2019), in a context that includes the following three main axes (Figure 2.1). Human centrality implies that people are at the center of production technolo­ gies. Machines and artificial intelligence are not a replacement for manpower but opportunities for transformation and growth. Furthermore, the speed with which technologies develop and replace themselves obliges us to see the worker as an investment, whose training must follow this trend. The workplace is defined as a safe and inclusive space, thus underlining the aim of technological evolution, that is, the psychophysical well-being of the worker (Lu et al., 2022). The sustainability to which the EU aspires requires a greater use of renewable sources, the reuse of energy and less waste to ensure that the energy needs of to­ day’s generations do not compromise resources for tomorrow’s generations. Re­ silience expresses a concept linked to the ability to deal positively with external events, which the world has had strong evidence of during the pandemic. The fifth industrial revolution, therefore, is “human-centric”; it seems to look to the past but with the awareness that these ambitious goals can only be achieved, thanks to the support of increasingly sophisticated and intelligent technologies. The in­ dustry based on the human-centric concept places the emphasis on improving

Figure 2.1 Industry 5.0 with three main axes

Advantages and Disadvantages of Industry 5.0 25 technologies in the service of man, rather than increasing productivity. A central concept stressed several times by the European Commission is that this new society uses technology, as opposed to what happens today, where the human being chases and adapts to a faster evolution than him. Industry 5.0 aims to create an industry oriented toward the concepts of sustainable development and circular economy, in which the well-being of man and society is the goal of the productive systems of the countries. The technologies that enable the principles of Industry 5.0 to be developed are personalized human–machine interaction; technologies inspired by nature and smart materials; digital twins and simulation; technologies for data transmission, storage, and analysis; artificial intelligence; and technologies for energy efficiency, renewable energy, energy storage, and autonomy (European Commission, 2022). 2.3.3

From Industry 4.0 to Industry 5.0: The Organizational Paradigm Shift

At least three reasons highlight that Industry 4.0 is the foundation from which Industry 5.0 develops and expands. Evolution is required given that (i) the Industry 4.0 digital economy determines monopoly increasing inequality; (ii) it is necessary to adapt Industry 4.0 to a broader socio-economic context; and (iii) Industry 4.0 has to be transformed into a more resilient industrial system. These drivers also involve leadership and organizational aspects. Zizic et al. (2022, pp. 5–6) reviewed more than 270 papers on the category organization that focuses on four key concepts: integration, standardization, decentralization, and networking and lean manufacturing. Using Google Trends, we have explored the total number of Google searches performed, in absolute terms, from September 2012 to September 20221, for the terms Industry 4.0 and Industry 5.0 (Figure 2.2), and Society 4.0 and Society 5.0 (Figure 2.3).

2012-09 2013-02 2013-07 2013-12 2014-05 2014-10 2015-03 2015-08 2016-01 2016-06 2016-11 2017-04 2017-09 2018-02 2018-07 2018-12 2019-05 2019-10 2020-03 2020-08 2021-01 2021-06 2021-11 2022-04 2022-09

100 90 80 70 60 50 40 30 20 10 0

Industry 5.0

Industry 4.0

Figure 2.2 The total number of Google searches for Industry 4.0 and Industry 5.0 terms

26

Simona Bigerna, Silvia Micheli, and Paolo Polinori

2012-09 2013-02 2013-07 2013-12 2014-05 2014-10 2015-03 2015-08 2016-01 2016-06 2016-11 2017-04 2017-09 2018-02 2018-07 2018-12 2019-05 2019-10 2020-03 2020-08 2021-01 2021-06 2021-11 2022-04 2022-09

100 90 80 70 60 50 40 30 20 10 0

Industry 5.0

Industry 4.0

Figure 2.3 The total number of Google searches for Society 4.0 and Society 5.0 terms

Figure 2.2 shows that the search interest for Industry 5.0 has increased over time, while the Industry 4.0 curve shows a decreasing trend since the end of 2019. Figure 2.3 shows that the search interest for both Society 4.0 and Society 5.0 has increased over time, with a prevalence of Society 5.0, although as of August 2022, the levels are equal. Then, we have compared, on a scale of 0–100, the relative popularity of the terms Industry 4.0 and Industry 5.0 (Figure 2.4), and Society 4.0 and Society 5 (Figure 2.5). Looking at the searches performed using the terms of our interest in Google Trends (Figure 2.4), it emerges that there was a surge in popularity for Industry 4.0 until November 2019, and interest, albeit relatively high, has been waning since then. As regards Industry 5.0, the interest is almost nil for the whole time period considered. The comparison of Society 4.0 and Society 5.0 terms in Google Trends (Figure 2.5) leads to a very different result compared to the Industry; this is large because the fourth industrial revolution Industry 4.0 is largely focused on companies, on the replacement and modernization of machine tools and production facilities, and not on a vision of society. The fifth industrial revolution, on the other hand, has its roots in the concept of society. Then, through Scopus, we have found the Industry 5.0 papers with the highest number of citations. The keywords entered in the Scopus search engine are “Industry 5.0,” “Society 5.0,” and “Manufacturing 5.0,” in the research areas of business, management and accounting, economics, econometrics and finance, and social science. We collected the data in June–September 2022. We found 204 papers, of which 46 papers that receive at least 10 citations, divided as follows: 21 papers regarding Industry 5.0, 15 papers regarding Society 5.0, and 5 papers regarding Manufacturing 5.0 (Table 2.1). As it is shown in Table 2.1, among the 204 selected papers, those who have a number of citations greater than 10 regarding Society 5.0

Advantages and Disadvantages of Industry 5.0 27

2012-09 2013-02 2013-07 2013-12 2014-05 2014-10 2015-03 2015-08 2016-01 2016-06 2016-11 2017-04 2017-09 2018-02 2018-07 2018-12 2019-05 2019-10 2020-03 2020-08 2021-01 2021-06 2021-11 2022-04 2022-09

100 90 80 70 60 50 40 30 20 10 0

Society 5.0

Society 4.0

Figure 2.4 The relative popularity of Industry 4.0 and Industry 5.0 terms

2012-09 2013-02 2013-07 2013-12 2014-05 2014-10 2015-03 2015-08 2016-01 2016-06 2016-11 2017-04 2017-09 2018-02 2018-07 2018-12 2019-05 2019-10 2020-03 2020-08 2021-01 2021-06 2021-11 2022-04 2022-09

100 90 80 70 60 50 40 30 20 10 0

Society 5.0

Society 4.0

Figure 2.5 The relative popularity of Society 4.0 and Society 5.0 terms

term are 85.5%, Industry 5.0 term are 86.1%, and Manufacturing 5.0 are 91.4%. The top five papers in terms of citation are 48.5% relative to Society 5.0 term, 47.1% for Industry 5.0 term, and 90% for Manufacturing 5.0. If we consider the country of origin of the most cited papers (looking mainly at the first author), Japan is the first country for Society 5.0 (4 papers), the United

Society 5.0

Total 81 citations(a) Top cited Fukuda, 2020 (>10) Gladden, 2019* Potočan et al., 2020*

Industry 5.0 468

Manufacturing 5.0

87

837

16

359

78

Japan

Nahavandi, 2019^

194

Australia Nahavandi, 2019^

194

Australia

51 35

UK Slovenia

Pillai et al., 2021 Gladden, 2019*

60 51

U.S. UK

48 41

India India

Aquilani et al., 2020*^

29

Italy

Javaid et al., 2020^

48

India

29

Italy

DeWit et al., 2020

34

Japan

Javaid and Haleem, 2020^

41

India

11

Italy

Mavrodieva and Shaw, 2020 Hysa et al., 2021 Pacana et al., 2020* Carayannis and Campbell, 2021* Saraji et al., 2021 Konno and Schillaci, 2021 Zengin et al., 2021*

23

Japan

Potočan et al., 2020*

35

Slovenia

21 20 18

Poland Poland U.S.

Martynov et al., 2019 Aquilani et al., 2020*^ Melnyk et al., 2019

35 29 27

Russia Italy Ukraine

17 16

Lithuania Choi et al., 2022 Pacana et al., 2020* Japan

26 20

Taiwan Poland

15

Turkey

18

U.S.

Sołtysik-Piorunkiewicz 15 and Zdonek, 2021* Shaw, 2020 15

Poland

Carayannis and Campbell, 2021* Zengin et al., 2021*

15

Turkey

Japan

15

Poland

Carayannis et al., 2022* 13

U.S.

Sołtysik-Piorunkiewicz and Zdonek, 2021* Carayannis et al., 2022* Carayannis et al., 2021 Mohammadian, 2020

13 13 13

U.S. U.S. Germany

Javaid et al., 2020^ Javaid and Haleem, 2020^ Aquilani et al., 2020*^ Margherita and Braccini 2021^

Simona Bigerna, Silvia Micheli, and Paolo Polinori

Papers

28

Table 2.1 Most cited papers on Industry 5.0 and related issues

# (>10) Cit. Ratio >10/Total Cit. Ratio Top5/Total Top country

Mohammadian et al., 2020 Rahman et al., 2019 Margherita and Braccini, 2021^ Chen et al., 2021

15 85.5% 48.5% Japan (4)

13 12 11

Germany Malaysia Italy

11 Denmark 21 86.1%

5 91.4%

47.1%

90.0% U.S. (4)

Source:(a) All the bibliometrics information refer to SCOPUS until September 9, 2022. Tips refer to papers that include among keywords: * Society 5.0 and Industry 5.0 (7); *^ Society 5.0, Industry 5.0 and Manufacturing 5.0 (1); ^ Industry 5.0 and Manu­ facturing 5.0 (4)

Advantages and Disadvantages of Industry 5.0 29

Italy–India (2)

30

Simona Bigerna, Silvia Micheli, and Paolo Polinori

States for Industry 5.0 (4 papers), and Italy and India for Manufacturing 5.0 (two papers). Then, we have investigated how many times the combination of terms ap­ pears within the most cited papers, finding that Society 5.0 and Industry 5.0 arise in seven papers, Society 5.0, Industry 5.0 and Manufacturing 5.0 in one paper, and Industry 5.0 and Manufacturing 5.0 in four papers. In accordance with other researchers (Zizic et al., 2022), prevailing research topics within the sample of the most cited papers emerge, providing useful insights into the paradigmatic changes. Using all the keywords of the top-cited paper, it emerges that the society is interested in ethical issues relating not only to relations with the environment, sus­ tainability, and social responsibility but also to the human–robots interaction and human–computers interface. In addition to issues related to artificial intelligence, robotics, and automation of advanced technologies, firms must face the change related to new architectures connected to multi-component technologies and big data. These are all essential elements for the personalization of their productions. Furthermore, paradigmatic changes involve several crucial topics which con­ cur to define the transition path toward Industry 5.0. Human-centric axe requires important efforts in the digitalization to improve the quality of workplaces acting on several dimensions such as physical, cognitive, and organizational ergonomics. Sustainability refers to new business models able to totally reduce the impacts of the environmental, social, and economic dimensions. Finally, resilience is perhaps the most difficult challenge, especially for EU and the United States. Resilience requires to develop specific organizational capabilities, routines, practices, and processes able to face and prevent risks, in which cooperation between firms becomes relevant. In the next section, we summarize the advantages and disadvantages of Industry 5.0 according to the most cited papers. Only when the references do not belong to the sample of the most cited papers, we provide specific citations. 2.4

Advantages of Industry 5.0

While companies find themselves following the lines drawn by Industry 4.0, the fifth industrial revolution is arrived, which is the goal to aim for. Industry 4.0 does not consider the essential performance to ensure the necessary efficiency in using resources while considering the environment, climate, and society. Value chains must be designed in accordance with the characteristics of the cir­ cular economy. Technologies that do not replace but enrich human abilities must be adopted. Safeguarding the environment requires industrial transformation promot­ ing energy efficiency obtained with nature-based solutions, regenerating carbon sinks, restoring biodiversity, and creating new ways of living in respectful interde­ pendence with natural systems. According to our reviewed literature and other scholars such as Alexa et al., 2022; Prassida and Asfari, 2022; Cillo, 2021; Aslam et al., 2020; Doyle Kent and Kopacek, 2021, there are several advantages related to Industry 5.0 which concern (i) environmental, (ii) social, and (iii) economic-financial dimensions which are the three aspects of sustainability

Advantages and Disadvantages of Industry 5.0 31 2.4.1

Environmental Dimension

The environmental dimension concerns the ability to respect the ecosystem, there­ fore to maintain the generativity of natural resources used by firms. The sustainable industry of the fifth industrial revolution that is characterized by energy efficiency and a prudent consumption of resources could help in reducing the carbon emissions in several ways. Sustainable industry can help maintain the capacity of carbon sinks by preserv­ ing their capabilities. Carbon sinks are all-natural deposits that absorb carbon from the atmosphere, reducing its concentration and thus decreasing the greenhouse ef­ fect. Carbon sinks are all the means that the planet has at its disposal to break down the CO2 molecule, removing carbon from the atmosphere and releasing oxygen. This balances the amount of carbon emitted by many other sources such as in­ dustries and means of transport. Forests can be considered a carbon sink, as well as oceans, soil, and swamps. For instance, forests cover about one-third of the earth’s land. If managed properly, they would be able to absorb, every year, about one-eighth of the carbon released into the atmosphere worldwide. Trees have a greater ability to retain carbon than plants, because their fibers imprison it longer than simple leaves. For this reason, a forest represents a huge carbon sink taken from the atmosphere and released into the ground. Each time a forest grows, trees grow or are managed properly, the capacity of this reservoir increases. Conversely, when a forest burns, is cut down, or becomes ill due to pathogens, the carbon cap­ tured over time can return to free itself, turning a carbon sink into an escape route. Then, the degradation of a reservoir such as the forest one becomes even more serious, because a disappearing forest causes double damage, that is, on the one hand the carbon, previously captured, is reintroduced into the atmosphere; on the other hand, the carbon sequestration mechanism is lost. The role of carbon sinks in mitigating climate change is of fundamental importance, but it also depends to a large extent on external conditioning of which we humans can be the proponents. In order for carbon sinks to retain their full potential, it will be essential to preserve their capabilities. It means limiting direct human actions (deforestation, changes in land use) and indirect (continuous emissions) deleterious. The use of edge artificial intelligence and green internet of things may also reduce the carbon footprint (Fraga-Lamas et al., 2021), that is, the parameter that measures the quantity of greenhouse gases released by a product, organization, or service in relation to activities and processes of a human nature (Pandey et al., 2011), in terms of energy efficiency, minimizing energy consumption. Looking at the enabling technologies, edge artificial allows to leave the main data centers and approach the data where they originate, generating new storage spaces and eman­ cipating, at least in part, from the computing power of the cloud. They concern the implementation of artificial intelligence solutions directly on the devices that gen­ erate the data processed by the algorithms, emancipating itself from the computing power of the cloud, and making it possible to process data instantly (Deng et al., 2020). Through edge artificial intelligence technology, stakeholders are instantly informed about what is happening within the firms, and can intervene promptly and

32

Simona Bigerna, Silvia Micheli, and Paolo Polinori

effectively for the benefit of efficiency. Green internet of things aims to reduce the environmental impact of the internet of things devices, thus allowing to mitigate the effects of such devised within households and businesses (Varjovi and Babaie, 2020). For doing so, several challenges need to be addressed, such as implementing the use of renewable power sources for internet of things networks, or reducing the use of batteries, while at the same time trying to make them more durable. Besides, artificial intelligence technologies are fundamental for the deployment of economy of recycling and regenerative economy. Fraga-Lamas et al. (2021) also show that a synergy between edge artificial intelligence and green internet of things can implement the visions of circular economy, allowing to effectively improve the impact on society and the environment. More generally, artificial intelligence for decarbonization can play a fundamental role in companies in various sectors, because it can be exploited to support companies in estimating and reducing green­ house gas emissions. Artificial intelligence makes it possible to carry out measure­ ments in an exhaustive, precise, and frequent manner, carrying out operations such as automatic data recovery, selection and matching, profiling of the value chain, and data extrapolation. It allows you to set goals and identify the best initiatives to reduce emissions, simulate reduction initiatives and impact and create optimized roadmaps, and perform direct optimizations, for example, optimizing energy con­ sumption in plants in real time or the conveyance and loading of goods. 2.4.2

Social Dimension

The social dimension, on the other hand, is the ability to guarantee well-being con­ ditions for people, attention to the quality of life inside and outside the company. QoL Inside the Company

Through Industry 5.0, the worker plays a key role within companies that strive to ensure that workplaces are safe and stimulating, with positive impacts on the psychophysical health of the worker. In this context, robots can be entrusted with the most dangerous tasks for humans. They can also perform repetitive functions, improving overall the work environment. Indeed, Industry 5.0 makes the shift from robots to cobots. Cobots are designed to collaborate with the man with whom they share tasks and workspaces. Cobots would be entrusted with the so-called 3D jobs: dull, dirty, and dangerous, with obvious advantages also for the health of workers. But the activity of cobots will not replace human workers but will have to integrate with them to create an increasingly effective and efficient work environment. The new generation robotic systems can physically be at the side of human workers and share their space, thus no longer being confined to a cage that separates the human space from that of the robot. A real change that opens the way to a different way of using robotics. A human–robot binomial is formed which, working together, mutu­ ally benefits from the coordinated action of both. The robot is capable of relieving humans from heavy operations with a high biomechanical risk. Cobots can be used, for instance, not only in automotive and manufacturing firms but also in important

Advantages and Disadvantages of Industry 5.0 33 new industrial sectors, thus opening up what is called the service robotics market. Service robotics draws its nourishment from applications in the industrial and civil sectors, both domestic and professional. As it is shown by Tiseni et al. (2021), col­ laborative robotics has already demonstrated the positive impact it has on human health and safety during the pandemic, through the sanitization of environments through particular procedures. Sanitation through robots requires the collabora­ tion and supervision of man to the extent that the latter defines the surface to be sanitized and controls the work. This procedure has very important effects both be­ cause the health of workers who otherwise would have carried out this task is better protected and because the times and courses of sanitation are considerably reduced (Sanchez and Smart, 2021). Cobots represent a lever for innovation in companies beyond the 4.0 phase of technological evolution, and thus are able to profoundly change the paradigms of production and work. Industry 5.0 technologies create a more innovative and interesting work environment, capable of attracting talents and skilled work. The introduction of robotics into workplace may also be an op­ portunity to recruit the next generation of workers that are attracted by using new technologies in workplaces (Welfare et al., 2019). QoL Outside the Company

Maddikunta et al. (2022) highlight that the emerging computational intelligence, an enabling technology for the development of Industry 5.0, and data from edge devices allow us to reach the hyper-customization process. Artificial intelligence can provide data regarding consumers’ preferences. The fifth industrial revolution is based on a business model characterized by the interaction between man and sys­ tems, and this interaction can also allow, knowing in detail the tastes of consumers, to offer products with a high degree of customization. This is the hyper-personalization process that, through the artificial intelligence technology, goes to a higher level than the current one. Among others, in the medical field, hyper-personalization represents a concrete possibility to improve people’s lives. Think, for example, of patients with type 1 diabetes, which is very difficult to control, and who now have a device that takes blood and measures blood sugar levels. Currently, this device communicates with another device which, based on the information received, delivers insulin into the blood. This device, however, is a one size fits all. With Industry 5.0, device customization would allow people to be given a device that follows their lifestyle and produces a manufacturing process for diabetes control. Thus, the individual, with a tailor-made device, can live better. Artificial intelligence technologies understand and calculate the behaviors of the body, learning through experience. Artificial intelligence will find natural syn­ ergies with robotics in the medical field in numerous projects that include, among others, assisted surgery, diagnostic imaging, nursing, and disability. The specificity of the interaction with humans typically leads many applications of robotics in medicine toward the need to conceive cognitive models that significantly benefit from artificial intelligence techniques.

34

Simona Bigerna, Silvia Micheli, and Paolo Polinori

Javaid et al. (2020) analyze the opportunities that have emerged from COVID-19 in the healthcare sector. They show that the innovative technologies of the fifth industrial revolution lead to health improvements in both facility management and education and training. Industry 5.0 technologies add a personal human touch to improve the automation and efficiency in healthcare. For instance, virtual consulta­ tion and telemedicine enhance personalized and creative treatment. Collaborative robotics will not lead to job losses, because cobots are built to work with operators to help them increase their performance as well. By taking away repetitive, mo­ notonous, dangerous, and often unpleasant tasks, people will be able to focus on activities with greater added value, and acquire and apply new and greater skills. Indeed, technologies based on artificial intelligence would also make it possible to involve a greater number of people with mental disabilities in the world of work. This is because these technologies support and guide the worker who is thus facili­ tated to perform tasks that require specific training and particular skills. 2.4.3

Economic and Financial Dimension

The economic-financial dimension is the ability to produce income and work, or economy in the most traditional sense of the term. Efficiency and Productivity

Collaborative interactions between humans and robots allow for a new balance between efficiency and productivity. The potential of cobots is expressed earlier all in their safety, flexibility, and the ability to memorize thousands of different pro­ grams, which can be reused and modified at any time, but also for their lower initial cost compared to more traditional solutions. This makes them the ideal solution for starting flexible production. Collaborative robotics becomes a fundamental choice for firms when production needs high flexibility, a large mix of products with lim­ ited volumes and high speed of adaptation. Predictive maintenance sector is also strongly involved in Industry 5.0 through collaborative robotics. The robots for inspection and maintenance, thanks to artificial vision technologies enhanced by artificial intelligence, are able to enhance the paradigm of predictive maintenance, which allows to foresee and anticipate the failure, through the measurement with systems of sensors of physical system parameters and mathematical models that allow us to identify the remaining time before the failure. Predictive maintenance represents an intervention methodology, to keep equipment, computers, industrial machinery in optimal operating conditions, avoiding breakdowns and above all ma­ chine downtime and therefore the interruption of production in the smart factory. Predictive maintenance is therefore more advantageous than current company’s physical infrastructure conservation strategies, because it serves to eliminate fail­ ures, and not just to repair a failure or to perform routine maintenance on a time or the intensity use (Pech et al., 2021). With the fifth industrial revolution, predictive maintenance will become a daily activity and maintenance policy a critical process in company business plans. In the interaction between man and machine, a result of

Advantages and Disadvantages of Industry 5.0 35 the technological innovation of Industry 5.0 are autonomous guided vehicles with the advantages of increasing competitiveness of firms, in addition to criteria related to environmental and social sustainabilities. Through artificial intelligence, autono­ mous guided vehicles are currently used in warehouses and companies to transport and collect materials, but new promising applications related to the deployment of artificial, virtual, and extended reality are expected to come. Supply Chain Management and Logistic

Industry 5.0 also generates benefits for logistics. The COVID-19 pandemic has spurred industrial change in many sectors, and logistics in particular has been immensely affected by the pandemic. Logistics has supported and is supporting changes in the economic system toward the path of sustainability and resilience. The pandemic has required logistics to significantly increase efforts to meet the demand of businesses and consumers who were unable to travel at certain times due to current restrictions. At the beginning of the pandemic, the logistics sector showed all its vulnerability but was able to promptly modify itself and adapt to the neces­ sary changes, through considerable investments in order to resist sudden changes in the market and be more competitive. However, with the end of the pandemic, the production system is moving toward transformation to satisfy sustainability and digitalization at the same time. This is where the so-called Logistics 5.0 of the fifth industrial revolution comes in. According to Sidek et al. (2021), green logistics refers to the set of policies and measures that make it possible to develop logistics ac­ tivities by limiting the environmental impact. The relationship between logistics and society is very strong in the fifth industrial revolution, because the role of the worker and sustainable development are key concepts. In particular, Logistics 5.0 provides that technologies are at the service of the worker. This enhances the role of people in this sector and increases the possibility of attracting talents. Processes, machines, and people interact simultaneously guaranteeing the quality of services and products. By innovating, companies guarantee greater efficiency and productivity and there­ fore a reduction in costs which is transferred to the final consumer. Financial Sector

Industry 5.0 generates advantages also for modern banking (Mehdiabadi et al., 2022). New technological facilities, innovations, and new services of the fifth in­ dustrial revolution allow banking managers to know better the context in which they operate and to improve forecasting skills. The bank of the fifth industrial revo­ lution must have several services and products to meet customers’ needs that have increased exponentially in recent years. Banks must therefore adapt to customer needs by following and anticipating their cultural transition. The fifth industrial revolution brings to firms several advantages and range from a better attraction of talents, to energy saving, to an increase in general resilience and sustainability. All this translates into increased competitiveness and gains in efficiency and profitability through the fifth industrial revolution’s technologies.

36 2.5

Simona Bigerna, Silvia Micheli, and Paolo Polinori Disadvantages of Industry 5.0

The progress of Industry 5.0 is underway, but there are still questions and doubts on the part of firms and people, which mainly policymakers, who push for a strong commitment to the transformation of the current economic paradigm, must face. These questions and doubts involve several dimensions. First of all, the risk of Industry 5.0 that potentially represents a disadvantage is represented by issues related to the cybersecurity (Fatima et al., 2022). This disadvantage has repercus­ sions on three levels: technical of the type of attack and the attacker, economic costs and economic benefits of the owner organization, and possible social costs. Cybersecurity refers to the protection of all devices and computer systems from ex­ ternal malicious attacks. These are digital attacks on systems, networks, programs with the aim of accessing sensitive data and information to modify, steal, destroy them or to defraud users, extort money, block business processes, and obtain cash ransoms. Cybersecurity is one of the pillars for the proper functioning of a company, and for the everyday life of people. It includes technologies capable of protecting IT systems, in particular, their integrity. The characteristics of cybersecurity are safety, understood as a series of actions capable of eliminating the production of damage within the system itself and reliability, that is, the prevention of events that can cause damage of varying severity to the system. Cybersecurity therefore moves from the monitoring of vulnerabilities within the system, passing through the implementation of prevention services and responses to external threats. The most important aspect of cybersecurity is the protection of the end user. The fifth industrial revolution must set guidelines in the sign of continuity to­ ward a transition that began with Industry 4.0 to prevent and protect cybersecurity. Cybersecurity challenges to provide basic security and privacy requirements within Industry 5.0 include the design of new augmented intelligence security architecture (Chergui et al., 2021; Fraga-Lamas et al., 2021). In this context, privacy in data transactions and privacy in data accumulation may be a risk. The data that are ex­ changed on the internet for cobots and humans to collaborate cannot be accessible to external users. Thus, privacy has strongly to be addressed. Edge computing might be a technology that ensures also data security and privacy (Maddikunta et al., 2022). 2.5.1

Environmental and Social Dimensions

Hazra et al. (2021) find that a disadvantage related to Industry 5.0 lies in the in­ creasing data computation which requires a greater use of energy which in turn translates into an increase in costs. The integration of artificial intelligence tech­ nologies in fog networks allows for adequate platforms for various services and applications related to the world of the Internet of things and has several applica­ tions in industrial applications, such as connected vehicles and smart cities. Within this framework, a sustainable grid is necessary to generate enormous data, while transmitting and processing in the networks. There are also risks related to the fact that some companies could face if they ignored the current trends and the

Advantages and Disadvantages of Industry 5.0 37 advent of Industry 5.0. In many workplaces, production technology is outdated and there is no communication through cyber-physical systems within companies, and production and efficiency suffer. Many managers are not in favor of using existing technologies to date. However, industry is called upon to actively partici­ pate in the relational era by engaging in designing an ecosystem of interdependent relationships. 2.5.2

Economic and Financial Dimensions

With reference to the use of robots in the industrial sector, legal and regulatory prob­ lems could arise because, so far, there is no legislation governing robots’ work in the service of people, that is, artificial intelligence that helps people with day-to-day household tasks, or the type of robots to be used in workplaces. According to Demir et al. (2019), disputes may arise in the absence of appropriate legislation. The regula­ tions should give appropriate definitions of robots. Furthermore, the regulations must also provide for the robots that can be used in companies, and their functions within the companies themselves and the legal consequences in case of malfunction of the robots must be defined. Also, implications for society that derive from the cooperation between man and cobot in the workplace in Industry 5.0 can also have a negative im­ pact (Doyle Kent and Kopacek, 2020; Smids et al., 2020). Indeed, robots may signifi­ cantly change the social dynamics at work, because social interactions decrease given that robots replace many workers. Feelings of isolation may arise due, for instance, to less consultation among colleagues, leading to the experience of meaninglessness. If robots come, with Industry 5.0, to work in increasingly skilled businesses, workers may feel a lack of purpose in their work. In the case of radiologist technicians, for example, systems equipped with artificial intelligence are able to read medical images with accuracy rates comparable to those of humans, or sometimes even higher. These systems can therefore lead physicians to find the “opinion” of these systems using machine learning techniques more useful, rather than interpretation by the radiologist. More generally, if robots perform increasingly complex tasks, human workers may have less self-esteem, because it is the exercise of complex activities, which could fail with Industry 5.0, which allows to achieve self-esteem. The autonomy of work­ ers could also be undermined, and therefore their significance, because some robotic applications within companies could require the human worker to work following a rigid proposition that leaves little room for creativity and judgment. Orea-Giner et al. (2022) have conducted an interesting study on the feelings that develop in the guests of the hotels managed by the robots and what are the consequent effects on the evaluation of the structures themselves. Already in some countries, such as Japan and South Korea, robots are being used more and more in everyday life. They find that oc­ currence of human–robot interaction terms causes very often negative feelings which clearly have an impact on the evaluation of accommodation facilities.

38 2.6

Simona Bigerna, Silvia Micheli, and Paolo Polinori Conclusions

Recent events linked to geopolitical changes and the pandemic crisis have brought out the weaknesses in the supply of goods and services. Resilience and sustainabil­ ity have now become essential. Modern industry must respond to these needs by ensuring production and respecting the planet and man plays a central role in this context. In the last 10 years, research has focused above all on new solutions regard­ ing digitization, artificial intelligence, and the industrial Internet of Things, without, however, considering the consequences in terms of environmental sustainability and people’s well-being. Currently, we have ahead important transformation— represented by the fifth industrial revolution. The underlying theme is to put the individual, the environment and society as a whole at the center of the new digital transformation inside and outside the factories. Just as Industry 4.0 was a response of European industry to the global crisis of 2008, a political–technological plan to modernize factories, so the Industry 5.0 model is fueled by the need to put man back at the center, to make him a protagonist in an environment more and more technological. To do this, it is necessary to switch to, for instance, high public debt, low birth rates, an increasingly aging population, growing pollution, the energy issue, inefficient public spending, low economic growth, rising inequalities and low participation of women in labor market led Japan first of all, and later the other developed countries, to overturn the terms of the question. Why are we innovating? Only for a question of productivity and GDP growth? The answer is broad, in the sense that it is necessary to accompany this new wave of technological innovation with the construction of an inclusive, environmentally friendly model of society, in which machines and humans can collaborate. Thanks to the digitization process and the automation of the production process, factories have become smart. Robot­ ics and virtual reality are, for example, enabling technologies that have made the development of smart manufacturing possible, a leaner and more efficient produc­ tion concept, which allows to optimize resources and reduce waste. Society 5.0 applies the same concept but expands the range of action to all areas of daily life and is closely intertwined with Industry 5.0. The goal of Industry 5.0 is to create an economic development compatible with the needs of society and the environment. The new technologies are set to improve the quality of life in the medium and long terms. Industry 5.0 technologies make it possible to reconcile industrial development and more generally economic development with respect for man and the environment. The industry will need to be increasingly human-centric, sustainable, and resilient, with several advantages, first of all the fact that it comes from a vision of society, and therefore aims to achieve social objectives while respecting people and the planet. Industry 5.0 can be a concrete answer to the management of global emergencies and crises. In general, it should be noted that Industry 5.0 is modeled so that tech­ nologies are at the service of man and the environment. In fact, Industry 5.0 is not enough to use the enabling technologies already in Industry 4.0 but is prepared to use them with respect for people and the environment. The benefits for businesses will also be significant. For instance, the centrality of man is evident because new

Advantages and Disadvantages of Industry 5.0 39 technologies make it possible to entrust man with tasks that require specific skills, to the advantage of efficiency, and to achieve high levels of personalization of goods and services. The fifth industrial revolution will change the work of man, creating new, better and more specialized jobs. The use of artificial intelligence in industry is in fact aimed at favoring workers. However, the progress of Industry 5.0 can be accompanied by some disadvan­ tages, such as the need for companies to have complex and very expensive software, security leaks, and the need for highly qualified people to operate complex processes. Even the use of cobots still represents a possible problem. Cobots, also outside the factories, can represent an effective tool and solution for combining productivity and sustainability, relieving operators from the heaviest and most dangerous tasks, innovating the way they work and produce. Yet, for instance, from the point of view of the human worker in collaboration with the cobots, there might be psychological risks to be addressed. To date, the cost of cobots is quite high and therefore not ac­ cessible to any company, that is, their price can be a deterrent for many companies, especially small- and medium-sized ones. Well, the fifth industrial revolution, as well as the revolutions that preceded it, is not without advantages and disadvantages. Unlike in the past, the current transition to a new industrial phase is not accompanied by a disruptive revolutionary change. Industry 5.0 will use some technologies that are already on the market today and are currently relevant. The revolution lies above all in the fact that the centrality of man, sustainability, and resilience are becom­ ing increasingly important in industry. Industry 5.0 is not configured so much as a technological or technical revolution as it was for the previous ones, but as a cultural one, since it brings people and the environment back to the center of the production processes of Industry 4.0, aiming at a more balanced relationship between technolo­ gies, more and more intelligent, and men. Industry 5.0 is defined not so much as an evolution, but as a complementary process to digital transformation, capable of directing growth in the direction of widespread well-being for society, people, and the environment. Thanks to the synergistic approach of Industry 5.0, which consid­ ers not only companies but also the environment and workers, organizations will combine objectives such as efficiency and productivity, with attention to our planet and the people who inhabit it, generating widespread benefits. Note 1 The data collected started in 2012 because it is the year in which these issues begin to take on an appreciable popularity.

2.7

References

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3

Industry 5.0’s role in achieving sustainability in multiple sectors Sumanta Bhattacharya

3.1

Introduction

Ever since the dawn of the Industrial Revolution, people have recognized tech­ nology’s ability to accelerate the rate of progress. Recent centuries have seen the development of industrial machinery, assembly lines, and computing, all of which aim to produce ever-more-powerful technology and increase production and ef­ ficiency. Industry 5.0 refers to the interaction between humans and machines, as well as the use of robots and human intelligence to make work more efficient and effective. It aims to address social issues while remaining in harmony with nature and includes energy, cities, healthcare, agriculture, food, manufacturing, services, logistics, disaster management, and finance. Companies’ safety management in the Industry 5.0 era necessitates a smart work culture based on sustainable devel­ opment, promotion of sustainable clean energy, and sustainable agriculture using high-tech technology and science. Industry 5.0 is a takeover by the improvements made to manufacturing processes since the First Industrial Revolution. Factory 5.0 represents the pinnacle of busi­ ness strategy optimization, where humans and machines collaborate to make the most profitable decisions for the organization with the fewest possible resources. 3.2

Sustainable Methods

However, environmental safeguards have not been at the forefront of any of the aforementioned industrial revolutions. This pattern is shifting as a result of Indus­ try 5.0 and the introduction of cutting-edge corporate technologies and sensitivity training. This has resulted in the development of sustainable policies, such as those that call for the generation of as little waste as possible and the implementation of systems to deal with that waste, which have become integral, enterprise-wide pro­ cesses that have contributed to the improvement of the organization’s efficiency. This change responds to the growing demands of international bodies, national regulations, and private customers. Climate change has emerged to be the biggest catastrophe of the twenty-first century. Every creature on this planet is affected by it, where sustainable development goals have emerged as a solution to the problem, and previous industrial revolution has contributed to the cause of climate change DOI: 10.4324/9781003404682-3

Industry 5.0’s role in achieving sustainability 45 through rise in pollution, extreme use of resources, and taking away of the land; here, Industrial 5.0 aims to protect the environment and create a friendly relation between the environment and the society by promoting a greener environment through green technology. 3.3

Expressive Individualism and Originality

The level of customization required by customers is beyond the capabilities of cur­ rent technological advancements. Industry 5.0 workers will take advantage of tech­ nology’s capabilities, but they will also have room to contribute their own insights, resulting in a custom-made good. In addition, the increased automation made pos­ sible by Industry 4.0 frees up workers to devote their attention to more strategic or imaginative endeavors. A new type of executive, the Chief Robotics Officer, has emerged as a result of the advent of Factory 5.0. This expert is well-versed in subjects like robotics and ar­ tificial intelligence and has a particular interest in how machines and humans inter­ act. In his position at the organization, he must make choices based on these criteria. As virtual education becomes more ubiquitous, it will also improve the training of employees. Costs can be reduced without sacrificing quality because produc­ tion can continue as usual while staff are being trained. Training becomes less dangerous as a result, protecting employees from harm during their education. The ensuing interactive learning environments also improve communication and staff motivation. Employment opportunities involving human contact with robotic sys­ tems and AI, among other technologies, are predicted to multiply rapidly [1]. 3.4

Technology That’s Just Right

In the context of Industry 5.0, the word “cobot” was invented to describe collabo­ rative robots made for easy and natural contact with humans. Human factors are taken into account in the development of this technology. In a sense, they assist operators in the role of a master by learning from observation and imitation, just like an apprentice might. There will be a need for more advanced technologies in factory 5.0, and digital twins are one of them. Visual representations like these can improve comprehension and validation testing of a product or process. In addition, the emergence of more complicated processes will need software that can handle such voluminous amounts of data and give human operators a platform for interact­ ing with automated systems. Technology and science advancement has entered every sector. Industry 5.0 is play­ ing an important role in the achievement of sustainable development goals and making the world carbon neutral, Industry 5.0 is contributing to the food security, reducing pov­ erty, and amplifying rural development. Integrating Human intelligence and machine brings rapid development, Industry 5.0 has made life easier for employees, providing better functions and growth, food, and nutrition for the employees, and maternal leave for women. Industrial 5.0 contribution to the energy, agriculture, waste management, environment sustainability, renewable energy, and green technology is significant.

46 3.5

Sumanta Bhattacharya Industry 5.0 and Renewable Energy

One of our top priorities is helping everyone gain entry to clean, modern energy. To alleviate poverty, economic growth is vital, but this cannot happen without suf­ ficient energy. If 1.2 billion people still lack access to electricity and 2.8 billion still lack modern cooking facilities, then economic progress cannot be called to be creating shared wealth. Opportunity, job creation, economic growth, and access to healthcare and education are all hampered by a lack of reliable energy sources. Affordable and reliable energy will be a top priority in developing nations. The availability of electricity will be addressed by exploring grid, mini-grid, and off-grid options. Off-grid solutions based on renewable energy paired with energy-efficient technologies may be the quickest way to provide affordable en­ ergy services in rural, remote, or isolated locations [2]. There will be a rise in the use of cleaner cooking and heating methods. Green energy can reach out to places where non-renewable source of energy could not reach. Renewable energy is contributing to the development of smart villages, reducing poverty in the rural region in many third world countries, especially in India, which is the third largest producer of solar energy in the world. Solar installation in every household has not only reduced the problem of electricity but also people are cooking food using green energy, reducing poverty, and generating employment in the region. Even in the urban sector, solar energy contributes to the reduction in the use of water for the production of electricity. Energy security is a major component for the reduction of poverty; access to clean energy is also a sustainable development goal. Sufficient access to energy is also required for the achievement of many of the sustainable de­ velopment goals it can eliminate food crisis and poverty, promote gender equality, and access clean drinking water and sanitation and, better healthcare provisions. In 2021, renewable electricity production is expected to increase by more than 8%, reaching 8,300 TWh. This would be the greatest annual growth in renewable electricity production since the 1970s. Two-thirds of the expansion of renewable energy sources will come from solar photovoltaics and wind power. In 2021, China will be responsible for about half of the world’s rise in renewable electricity, fol­ lowed by the United States, EU, and India [3]. With a growing population comes a greater demand for energy, and while nine out of 10 people now have access to electricity, those in rural and semi-urban areas still do not. Extreme greenhouse gas emissions and water consumption caused by non-renewable energy sources have a negative impact on the planet. Sustainable development necessitates the use of renewable energy sources like solar, wind, and hydropower that are gentler on the planet. Because 60% of the world’s energy comes from non-renewable sources, Three billion people use biomass fuels like wood, coal, charcoal, and animal waste for cooking and heating, and four million people die each year from exposure to toxic air in their homes, it is imperative that we find ways to produce clean energy so that everyone can enjoy the basic human right to a healthy and safe environment [4]. There is a widespread electricity shortage in South Asian and African coun­ tries, but renewable energy sources can reach even the smallest villages. Rural

Industry 5.0’s role in achieving sustainability 47

Source: Author

electrification made possible by clean energy helps ease the food security, water security, and poverty crises. We can use coastal regions as a wind energy hub and also create energy from coastal sea waves. Therefore, we will need to generate air-floating energy chambers for improved energy storage, ease of usage, and environmental protection. In the renewable energy business, logistics are important for better supply chain management, economic growth, and long-term sustainability. California has completely shifted to electric vehicles as a source of energy that emits no greenhouse gases and is environmentally good and pledged to cut greenhouse gas emissions by 80%. On top of a building in South Korea, solar panels have been erected. Solar panels become more efficient due to the cooling impact of the filtering reservoir of the water purification facility. Normal electricity generation hours in Seoul are 3.1 or 3.2 hours per day; however, because of the cooling impact, this has changed. Compared to the average of 3.7 or 8 hours a day, the production

48

Sumanta Bhattacharya

of renewable energy has generally reduced energy use and reduced energy usage by using passive designs to develop structures that utilize little to no energy. 3.6

Industry 5.0 and Agriculture

Smart farming aims to achieve a sustainable agriculture sector by doing two things: supporting the decision-making process when managing a crop or a herd, as well as boosting the number of correct choices taken per component of cropped land or per mammal, considering the available time; and (ii) integrating the green energy sources into smart farms [5]. Conventional farming practices contribute to global warming through deforestation and the deterioration of land resources. Soil health, groundwater reserves, and water reserves in terrestrial water bodies are all being negatively impacted by environmental deterioration, which in turn reduces agricultural output. So, modern agricultural practices are centered on eco-friendly expansion that lessens the negative effects of climate change. Recombinant DNA technology, along with other cutting-edge technolo­ gies adopted from other fields of genetic engineering and the enhancement of plant nutrient and water uptake capacity through nanotechnology, is contributing to the increased stress resistance of today’s crops. Bioengineered organic fertiliz­ ers and insecticides, in conjunction with bespoke nanomaterials, can boost soil fertility and raise crop yields without the use of potentially dangerous chemical fertilizers. We are shifting to new farming practices because of widespread land degradation, radical shifts in weather patterns, and diminishing soil quality in rural areas. Indoor plant cultivation, or “vertical farming,” is an emerging trend in the agriculture sector. Farmers are no longer restricted to cultivating their crops on land, thanks to soilless growing techniques like hydroponics, aquapon­ ics, and aeroponics. Society is shifting toward climate-smart farming practices as a means of in­ creasing agricultural output despite adverse weather conditions. “Green technol­ ogy” refers to the slew of recent innovations in farming equipment and methods that aim to lessen their impact on the environment without sacrificing productiv­ ity. Smart farming solutions based on cutting-edge technologies like AI, ML, IoT, Cloud, etc., make it easier to optimize resource use, manage waste sustainably, and reduce greenhouse gas emissions [6]. The contamination of soil and groundwater reserves and the prevalence of ex­ treme climatic conditions are two of the biggest challenges conventional agricul­ tural methods face in the current scenario. As opposed to the horizontal plane used in conventional farming, vertical farming allows us to grow our food at varying heights. This means that the same amount of land can now produce significantly more food for humans. For the sake of the environment, the economy, and the community, vertical farming is a viable urban farming technique. Farmers are con­ stantly striving to improve their harvests. Water and fertilizer are used more effi­ ciently. This innovative method may reduce water use by as much as 95%. It also improves land management and allows for year-round production of fresh, organic produce, which contributes to greater food and water security.

Industry 5.0’s role in achieving sustainability 49 More accurate detection of pH, the diagnosis of clinical and metabolic compli­ cations, the estimation of crop quality, temperature, and the bioavailability of ben­ eficial and harmful microorganisms have all been made possible by incorporating nanomaterials like nanotubes, nanorods, and nanowires into biosensing technol­ ogy. As their piezoelectric and color-based detecting mechanisms can be manipu­ lated, nanomaterials can be incorporated into biosensors [7]. The development of biotechnology has contributed significantly to the growth of the agricultural sector. Increases in agricultural production are now possible without risking ecological collapse, all because of advances in genetic engineering. Transgenesis and recombinant DNA technology are two examples of the kinds of cutting-edge techniques that have made it possible to cultivate crops with enhanced resistance to pests and diseases. Crops that can withstand environmental and animal threats can be bred by modifying plant genomes. By incorporating nanoparticles into fertilizers, a proven method for remediating soil and water, soil health has been improved and agricultural output has increased. On the other hand, innovative ag­ ricultural tools have improved yields and resource utilization on farms. Deepwater culture hydroponics, aeroponics, the wick system, the nutrient film technique, the

Use of drones Ver•cal farming

Biotechnology

satellite

Sustainable agriculture

Nanotechnology

Biotechnology

Machine learning

Nnaotechnology Roboi•cs

Figure 3.2 Industrial 5.0 contributing to the agriculture sector Source: Author

Internet of Things

50

Sumanta Bhattacharya

drip system, the ebb and flow system, and many more hydroponics methods only require nutrient-laced water for plant growth. Due to the inability of soilless potting mixture components to store water for extended periods of time, hydroponically growing crops that require a lot of water present their own unique challenges. Soilless agriculture, which draws from fields like genetic engineering, tissue culture, embryo rescue, somatic hybridization, molecular diagnosis, micropropagation, etc., can also be used to cultivate water-intensive crops. Nanoparticles are a promising tool for reducing contaminant levels in the water used by hydroponic systems. Sev­ eral biotechnological methods exist for lowering the nutrient needs of a crop, which in turn lowers the price of hydroponic solutions. The fourth generation of technol­ ogy has the potential to greatly improve essential crops. As a result, the agricul­ tural industry becomes less reliant on external factors like climate, fertilizers, water, land, and infrastructure. This facilitates the industry’s ability to grow sustainably. Technology and nature-based solutions are the only solutions to promote a sus­ tainable agriculture and achieve food security, and Agriculture 5.0’s use of remote sensing, artificial intelligence, machine learning, satellites, and drones will help get us there. The land is unfit for cultivation, and with a growing population and greater demand for food, we will need to increase food production by 70% by 2030. To maximize the agro-economy, we need to build digital lab testing for seed culture and fertilizer culture. We need to establish an agro-school with international collaboration and agro-scientists to make agriculture farming an exciting portfolio, as well as introduce renewable energy with the most advanced technology to elimi­ nate electricity and water constraints. 3.7

Industry 5.0 and Environment Sustainability

Humans are at the center of Industrial 5.0’s focus on resilience and sustainable growth. The key to a better future lies in practices that are both sustainable and innovative. The degradation of the natural environment is a major contributor to global warming. There has been an increase in greenhouse gases and pollution due to a number of factors over the years, including a lack of food and water, rising sea levels, frequent natural disasters, increased poverty, deforestation, and the advent of new industrial processes. Industries are not the only source of waste, however causing harm to the natural world. However, the fifth industrial revolution is cen­ tered on sustainability and the promotion of a greener world. In order to achieve the goals of Industrial 5.0, green technology must be widely adopted. Since the beginning of the industrial revolution [8], we have looked at technology as a tool for advancing society and streamlining processes, but this mindset has ultimately resulted in massive amounts of trash and a deteriorating natural habitat. In a time when people are turning away from industrial agriculture in favor of more sustainable practices like water conservation and ayurvedic medicine, tech­ nology is playing an increasingly important supporting role. By utilizing a smart manufacturing system, robotics, and automation, Industrial 5.0 lessens production costs while also benefiting workers and the planet [8], keeping a healthy equilib­ rium between humans and robots.

Industry 5.0’s role in achieving sustainability 51

Circular economy use of machines

Waste management

Environment protec on reduce deforesta on

passive houses

Sustainable farming

renewable energy

Figure 3.3 Industry and environment protection Source: Author

The concept of a circular economy, along with responsible waste management, has emerged as a crucial part of the sustainability movement. Modern machinery and technology have helped improve recycling rates and landfill longevity, both of which are essential to achieving sustainable waste management. Agriculture waste, plastic waste, organic waste, and textile waste are all being put to good use at our facilities, helping to sustain local economies while also easing environmental stress. Buildings designed to be as energy efficient as possible, or “passive,” are one way that urban mobility and the development of electric vehicles hope to cut down on greenhouse gas emissions. Passive house design strives to create a zero-energy structure. All the nations of the world are working on it right now. There have been 60,000 passive house projects. We get to see a number of passive houses in Germany and Austria. Passive houses reduce heating energy use by 90% compared to conventional homes and by 75% compared to the typical new home. They only need supplemental heating during extremely cold weather, while during the hot summer months, they can forgo air conditioning because the insulation will keep

52

Sumanta Bhattacharya

the heat out [9]. Sustainable housing can also reduce the consumption of energy. Passive house construction in third world countries where electricity is a major problem can contribute to reducing poverty. We can save energy. 3.8

Industry 5.0 and Sustainable Development

Information and communications technology (ICT) is one industry that will be essen­ tial. The UN itself admits that utilizing ICT will be essential to its efforts. The expan­ sion of information and communications technology and global interconnectedness, according to the UN General Assembly’s 2030 Agenda, “has immense potential to accelerate human progress, to bridge the digital divide, and to establish knowledge societies.” The UN Assembly views ICT infrastructure as a fundamental “means of implementation” that supports the accomplishment of all objectives. ICT is a criti­ cal enabler for the three keys of sustainable development—economic expansion, social integration, and protection of the environment. The 17 SDGs can be achieved but only with increased development in terms of pace, scope, and equality. In the environment of business as usual, economic growth will not help us reach the SDGs. Only ICT, especially broadband, can bring about this development boom [10]. Industrial 5.0 has a crucial role to play in the achievement of the sustainable development goal from eliminating poverty, food crisis, well-being and health, uni­ versal education, marine pollution, access to clean drinking water, and sanitation; development of smart villages; and sustainable rural development. The greatest challenge of the twenty-first century is the water crisis; by 2030, more than 40% of the population will lack access to water, where nanotechnology is making it possible to treat wastewater through advanced technology. In order to meet the rising demand for water, “non-traditional sources” like seawater are being tapped. Water from the ocean is a viable option for people living in arid regions such as the countries of the Arabian Gulf. Water pollution is on the rise, as are carbon footprints and urbanization, both of which place a strain on our traditional freshwater supplies [11]. It is common practice to use reverse osmosis membranes for the treatment of seawater. Today, the reverse osmosis method accounts for over 65 million tons of the world’s freshwater production. Planktons and other microbes are ineffective in remediation unless 5–7 megapascal pressure is applied. The use of nanotechnology use in RO membrane production has recently been shown to improve performance. Nanotechnology provides a long-term solution for removing both organic and in­ organic pollutants from water. In order to remove the contaminants from the water, nano-adsorbents are used. Polymeric units are incorporated into nanoscale metals and metallic oxides such as titanium, titanium oxide, gold, silver, and carbon-based na­ nomaterials such as single- and multi-walled carbon nanotubes and graphene. Metal ions in water can be removed by forming stable chelating complexes with polymeric nanoparticles. Nanometals and metallic oxides are capable of efficiently adsorbing organic pollutants. Membranes and zeolites with nanoscale structures are used to filter out ionic contaminants. Nanoscale valence-zero metals, such as iron, zinc, sil­ ver, etc., neutralize pollutants. Silver nanometals have strong antimicrobial properties because they react with the phosphate parts of the DNA of microorganisms.

Industry 5.0’s role in achieving sustainability 53

Source: Author

Industrial 5.0 also contributes to a reduction in marine pollution. Several mechanisms have been adopted by different countries to remove the contaminants from the ocean water using advanced technology like information technology and communication, artificial intelligence, machine learning, and robotics. The AlphaMERS Floating Barrier was developed in India in 2015, to barricade the solid waste and plastics which are thereby carried to the riverbank for collection. A ship with saucers was also developed in 2012 that uses centripetal force to capture waste from the sea surface and separate it thereafter for disposal. In the Netherlands, C-shaped booms and screens are used to clean coral trash using waterway currents. Floating devices are also used to catch litter and keep it from contaminating the waterway downstream. A drone modeled after a whale shark is also being developed that is able to skim water to collect solid waste. An automated solar-powered catamaran has been developed to extract floating plastics from river and seawater using a barrier and conveyor belt mechanism. Tubes are also placed diagonally across the bottom of the waterway to create a bubble barrier across the deep-sea trash, which eventually moves upward and captures at the surface due to water current [12]. In the United States, robots are used for the detection of marine debris on the open ocean surface, which is then collected later. The Holy Turtle, a 1,000-foot-long floating unit, is used to tow vessels that capture floating waste such as microplastics, sediment plumes, and other solid waste on the sea surface. Solar-powered floating robots known as Floating Robots for Eliminating Debris (FRED) are also used there for the collection of debris

54

Sumanta Bhattacharya

from the ocean surface and deep sea using conveyor belts. Trash-skimming boats are also used to collect plastic from the ocean surface. An Inner Harbor Water Wheel is also being developed to collect plastics from the river near the harbor before it flows to the ocean. A Satellite Navigation System has been installed in the nets to locate lost nets and avoid the process of ghost shipping, which is the capture of fish and other marine creatures on nets lost during deep-sea fishing. Numerical models and machine learning technologies are then used to identify the best routes for collecting waste and lost nets. Floating beams are used to cre­ ate a barrier that collects surface debris along rivers. Solid waste is shifted from the soil and sand of sea beaches using tractor-towed machines and walk-behind sand-shifting machines. Remotely operated vehicles use infrared radiation to de­ tect and photograph microplastics in the waterways. A Marina Trash Skimmer is a pump which is used to partially submerge into the water for the collection of surface trash. In France, remote-controlled robots are also used for the collection of solid waste from waterways. 3.9

Industry 5.0 and Education

Industry 5.0 also contributes to a smart education system; with changing work cul­ ture and demand of society, the education system requires innovation and digital literacy for development and growth. COVID-19 pandemic has given a new dy­ namic to e-learning, and the world is getting accustomed to new patterns of learn­ ing, where there are no geographical boundaries. This is especially true for people working in the education sector, who may find their jobs altered or even threatened. Work in the new high-tech, human-centric environment will call for a different set of skills due to the shifting roles and increased reliance on complex technologies. The conventional education life cycle of schooling, employment, and retirement is being challenged by rapid technological advancements. Lifelong learning, superior emotional, social, and cultural intelligence, strong critical thinking and communi­ cation skills, and the ability to interact with and create novel technologies that drive the life cycle are all necessities in today’s high-tech, human-centered environment [13]. Choosing a career that aligns with the future skill sets required by Industry 5.0 and the needs of the entrepreneurial landscape is crucial for millennials. It is estimated that by the year 2035, half a billion people will use tools powered by artificial intelligence (AI) to save 2 hours per day. By the year 2025, machines will have taken over about 800 million jobs. We need to empower students with digi­ talization and promote digital learning. There needs to be a shift in the educational system’s focus to include teaching students practical skills they may use through­ out their lives. Researchers and businesses need innovative methods of funding and growth. There has to be a complete overhaul of our admissions process, a break from the colonial educational model, and a focus on developing each student’s individual strengths. It is imperative that we connect rural communities to univer­ sities through online education. Bricks made from trash using bioengineering, ar­ chitectural design, and technology could help keep classroom temperatures stable. The Indigenous communities’ Polit initiative needs our help.

Industry 5.0’s role in achieving sustainability 55 3.10

Conclusion

The beginning of a new era, Industrial 5.0, is a clean slate that will steer the trajec­ tory of future economic expansion. Industrial 5.0 contributes to the realization of the Sustainable Development Goals (SDGs) by placing an emphasis on humancentered design, environmental preservation, and resilience. The human–machine interface not only makes our lives easier and more versatile but also helps encour­ age environmentally responsible practices such as recycling and the use of renew­ able energy sources. This is because the HMI makes our lives more convenient and adaptable. The inventions of Industrial 5.0 contribute to the advancement of a sus­ tainable lifestyle, as well as the circular economy, waste management, agricultural improvement, smart homes, and the expansion of smart cities. 3.11

References

1. Industrial 5.0: The new revolution, Digital Transformation, Industry 4.0, Nexus Integra. https://nexusintegra.io/industry-5-0-the-new-revolution/ 2. Toward a sustainable energy future for all: Directions for the World Bank Group’s energy sector, public disclosure authorized. https://documents1.worldbank.org/curated/ en/745601468160524040/pdf/Toward-a-sustainable-energy-future-for-all-directions­ for-the-World-Bank-Groups-energy-sector.pdf 3. Global Energy Review 2021, IEA. https://www.iea.org/reports/global-energy-review-2021 4. The SDG in Action, UNDP. https://www.undp.org/publications/sdgs-action 5. Ragazou K.; Garefalakis A.; Zafeirious E.; Passes L. 2022, April. Agriculture 5.0: A new strategic management mode for a cut cost and an energy efficient agriculture sector, Special issue new challenges in energy and environment economics. MDPI. 6. Hrubovcak H.; Vasavada U.; Aldy J. E. 1999. Green technologies for a more sustainable agriculture (Agriculture Information Bulletin No. 752). US Department of Agriculture. 7. Aslani F.; Bagheri S.; Julkapli, N. M.; Juraimi A. S.; Hashemi F. S. G.; Baghdadi A. 2014. Effects of engineered nanomaterials on plants growth: An overview. Scientific World Journal, 2014. 8. Goncalves S. Industry 5.0: Building a more sustainable human-centric and ethical industry. Platform Blog. 9. McCord M. 2021, January. SDG 07: Affordable and clean energy, what exactly is a passive house – and could it be the future of sustainable housing? World Economic Forum. https:// www.weforum.org/agenda/2021/01/passive-housing-sustainable-emissions-reduction/ 10. Crawford M. 2017, May. The role of technology in the UN SDGs, part one. ADEC Innovations. 11. Jordan E.; Jessica M.; Hakeem H. M.; Suryajaya T.; Nugraha T.; Listyorin N. T. 2016. A review of nanotechnology application for seawater desalination process. Surya Octa­ gon Interdisciplinary Journal of Technology 1, no. 2: 155–179. 12. Schmaltz E.; Melvin E. C.; Diana Z.; Gunady E. F.; Rittschof D.; Somarelli J. A.; Virdin J.; Dunphy-Daly M. M. 2020. Plastic pollution solutions: Emerging technologies to prevent and collect marine plastic pollution. Environment International, 144. 13. Narlu A. 2022, September. Industry 5.0: Are higher education stakeholders ready for transformation. BW Education, Business World.

4

Client and Value in the Quality Management A Case of Society 5.0 Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser

4.1

Objectives of the Chapter

The following are the objectives of the chapter: 1. To understand the concepts of Client, Value, and the Society 5.0; Quality and Quality Management. 2. To explore the relationship between Client, Value, and the Society 5.0; Quality and Quality Management. 3. To discuss the role of Educational Leaders and Managers to manage and maintain the Quality Education in the perspectives of Client, Value, and the Society 5.0. 4. To Explore the challenges, issues, and problems with their solutions to manage the Quality Education in the perspectives of Client, Value, and the Society 5.0.

4.2

Introduction

A client is defined as a customer, a buyer or purchaser or a receiver of any things, goods, or services (Duncan & Reese, 2015; Lambert & Shimokawa, 2016). It can be defined as a person who takes any help or advice from any professional to solve his or her problems (Duncan & Reese, 2015; Lambert & Shimokawa, 2011; Lambert et al., 2018). In detail, a client can be defined as an individual or a person, and an organization has some working relations (Paas & Kuijlen, 2001) who uses the professional advice or services of a lawyer, advertising and state agency, architecture, accountant, and a company for its survival or benefits in any regular and critical situation (Miller & Stoeckel, 2019). There is little dif­ ference between clients and customers such as a customer is someone who buys products or services (Yusof et al., 2015), while a client refers to a certain type of customer who purchases professional services from a business (Wolf & Zhang, 2016). Generally speaking, customers buy products while clients buy advice and solutions (Lewis & Mitchell, 1990). The client can be defined from the per­ spective of the computer and its literacy as the role of its application or system that requests or consumes the services provided (Paas & Kuijlen, 2001) by any DOI: 10.4324/9781003404682-4

Client and Value in the Quality Management 57 server, that is, the client process comprises solution-specific logic and offers the interface between the user and the system concerned with its applications or usage (Gantz & Philpott, 2013). The client process also manages the local resources (Arsanam & Yousapronpaiboon, 2014) the user interacts with such as the monitor, keyboard, workstation, CPU, etc., for client or customer satisfaction (Wisniewski, 2001). The value means the importance and usefulness of something (Rim, 1970) dis­ crepant from those of many clients (Bergin, 1980a) that may be estimated the mon­ etary worth (D’Amato et al., 2016; Kogan & Wallach, 1961) to consider someone to be beneficial for the life of the creatures (Ellis, 1980), especially human beings (Bergin, 1980b) with satisfaction (Wisniewski, 2001), etc. Value is worth in goods, services, or money of an object or person that is given by an appraiser after apprais­ ing through appropriate processes and may be religious (Walls, 1980; Worthington, 1991), especially given by the input of any consultant or committee. Values are fundamental beliefs (Beutler, 1979; De Groot & Steg, 2007; Worthington, 1991), which motivate the actions and attitudes (Cobbinah, 2015) of clients and customers (Beutler & Bergan, 1991; Parrott, 1999) to work hard for the success (Fleishman & Peters, 1962) and achievement of life, especially by minority clients (Consoli et al., 2008). Understanding the values in the life of any individual plays a vital role to get success because it helps to determine the most important things connecting with counseling (Barnes & Murdin, 2001). Acquisition of a sense of value (Batavia & Nelson, 2017) and ethics (Barnes & Murdin, 2001) helps individual(s) to assess and evaluate the processes and products of achieving life goals (Bergin, 1985). Loyalty, spirituality, humility, compassion, honesty, kindness, integrity, selfless­ ness, determination, generosity, courage, tolerance, trustworthiness, equanimity, altruism, appreciation, empathy, toughness, self-reliance, attentiveness, etc. are the common and basic values (Cross & Khan, 1983) of human life that directly influ­ ence their day-to-day routines. These values help the individual(s) to give proper and authentic importance to the things and matters in their life (Hansen, 2006) based on their needs and requirements. These values guide the individual(s) to live a happy life (Henriksen & Trusty, 2005) with pace and prosperity to maintain the future sustainability of the society for the collective benefit of all members of the society (Kelly, 1990), which is considered the real success of humanity and its values (Ihemezie et al., 2021). A prosperous society can be made and maintained through the values of the clients or individuals (Kim et al., 1999), who think, act, and implement the values (Mahalik, 1995) in their day-to-day routines for the bet­ terment of all, betterment for all, and the betterment by all leading toward the scientific democracy in the society (Parrott, 1999), which maintains the quality of education through the quality of management. There are four types of values, that is, individual, relationship, organizational, and societal values. Individual values reflect the specific needs of life and the principles to live for self-interest (Tjeltveit, 1986, 1999). They include enthusiasm, creativity, humility, and personal fulfill­ ment. Relationship values relate to other people and their role in the life of an individual, that is, friends, family, colleagues, and organizations (Levy & Schuck, 1999). They include openness, trust, generosity, and caring. Organizational values

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Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser

reflect the organizational operations in the world that include financial growth, teamwork, productivity, and strategic alliances (Diaz & Hansz, 1997). Societal values reflect the relationship between an individual and his or her organization and society that include the future generations, environmental awareness, ecology, and sustainability (Watson et al., 2006), which is a very close concept and detailed description to Society 5.0. Society 5.0 envisions a human-centered community that coordinates economic progress and solves social problems (Rojas et al., 2021). With every innovation, the world moves toward that society which we term Society 5.0 (Deguchi et al., 2020). It is a sustainable, inclusive, ultra-smart, and balancing society (Potočan et al., 2020). Similarly, Industry 5.0 benefits the industry, workers, and society (Berawi, 2019), which empowers workers and responds to their evolving skills and training needs to transform the society (Melnyk et al., 2019). It helps to make the industry more competitive and attract the best talent (Fukuyama, 2018). In addition, Society 5.0 revolves around digital transformation and uses digital tech­ nology (Gladden, 2019) to create new business processes, cultures, customer ex­ periences, and modify existing processes to meet changing business and market needs (Goede, 2020). The restructuring of business in this digital age is digital transformation with financial performance (Michna & Kmieciak, 2020). The ba­ sic schema of Society 5.0 is that information are collected from the “real world” and processed by computers, with the results being applied within the real world (Paliszkiewicz, 2019). This schema is not new in itself. Several of the systems we have a tendency to believe in society use this basic mechanism. It underlies the systems accountable for keeping our homes adequately furnished with elec­ tricity, and (people) that keep the trains running on time (Pereira et al., 2020), the mechanism depends on computerized machine-driven controls (Paliszkiewicz, 2019). Once people use the term “information society,” they mean a society within which each of these systems collects data, processes them, and so applies the ends up in a specific real-world environment (Popkova & Gulzat, 2019). Society 5.0 can have systems that operate throughout society in an integrated fashion (Deguchi et al., 2020). To confirm happiness and comfort, it is not enough simply to own comfy space temperatures. We have a tendency to need comfort in all told aspects of life, together with energy, transport, medical care, shopping, education, work, and leisure (Prasetyo & Arman, 2017). To the current end, systems should gather varied and voluminous real-world information. These data must then be processed by refined IT systems that cherish AI, as solely these IT systems might handle such an enormous array of data (Gladden, 2019). The data yielded from such process must then be applied within the world thus on build our lives happier and a lot of comfortable (Deguchi et al., 2020). Quality means an improvement in product quality, which is considered a de­ gree to which an object or entity, that is, processes, products (Garvin, 1984), and services are judged to satisfy (Broh, 1982) a specified set of distinctive attributes, characteristics, and requirements possessed by someone or something (Carroll & Booth, 2015). The quality of something can be determined by comparing a set of inherent characteristics with a set of requirements (Garvin, 1988) the standard of

Client and Value in the Quality Management 59 something as measured against other things of a similar kind connected with the degree of excellence of something. Quality is a judgment of how excellent some­ thing or someone is at a well-made product (ISO 9000, 2005) depending on the distinctive characteristics or traits (Galetto, 1999), that is, charisma, intelligence, and responsiveness (Crosby, 1979, 1996; Juran, 1988). There are five major ap­ proaches to defining quality: (a) the transcendent approach of philosophy; (b) the product-based approach of economics; (c) the user-based approach of economics, marketing, and operations management; and (d) the manufacturing-based and (e) value-based approaches of operations (Garvin, 1987, 1988). There are many defi­ nitions of quality connected with objective and subjective facts, which have been defined separately by every quality expert depending on their knowledge, exper­ tise, exposure, environment, criteria, etc. that affect ecology, outcomes (Saraiva, 2018), etc. While quality can be defined as a basic tool for a natural property of any goods or services that allows it to be compared with any other goods or services of its kind and nature (Dale, 1999), it refers to the set of inherent proper­ ties of an object that allows satisfying stated or implied needs depending on the perception of a customer’s mindset to accept the specification that meets his or her needs. Quality is directly concerned with the product features, deficiencies free, specification enrichment, value addition, and attraction for customers (Batavia & Nelson, 2017). Because quality is considered an outcome and the hallmark of an organization to satisfy all or the majority of its stakeholders (Saraiva, 2018), the main factors of quality are exact and desired amount of product to be manufac­ tured and offered; the pace of product distribution; the speed of customer service; appropriate pricing in line with supply and demand pressures; degree of accuracy with which a product is manufactured; appropriate and attractive design; ease of use with safety; reliability; and the impact of the product on the society and the environment (Saraiva, 2018). The quality is old as its production (Mukherjee, 2019), which consists of any products, services, experiences, assets, etc., can be described through tangible and intangible aspects (Dale, 1999), which are known as the types of quality, that is, product quality, service quality (Yaya et al., 2012), experience quality, information technology (IT) quality, data quality, information quality, and quality of life (Has­ senstein & Vanella, 2022). Product quality generally consists of deconstructability, efficiency, fault tolerance, maintainability, refinement, reliability, reusability, and safety (Vugigi et al., 2021). Service quality consists of accessibility, availability, personalization, and usability (Yaya et al., 2012). Experience quality consists of customer services, environments, user interface, communication and information, processes and activities, delivery, adaptability, empathy and tailoring, reliability and consistency, competence and diligence, image and identity, engagement, risk, tangible, and design (Kim & Choi, 2013; Kusumawati & Rahayu, 2019). Informa­ tion technology (IT) quality consists of code smell, defense in depth, interoper­ ability, mistake proofing, service level, and stability (Osinulu & Amusa, 2010). Data quality consists of data integrity, data rot, relevance, timelines, precision, correctness, completeness, credibility, and traceability (Carroll & Booth, 2015). Information quality consists of actionable information, human readable, precision,

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and privacy (Carroll & Booth, 2015). Quality of life consists of health, air quality, water quality, food quality, safety, education, knowledge, freedom to roam, free­ dom of speech, freedom from fear, happiness, resilience, human rights, legal rights, privacy, standard of living, public space, profession and creativity, and sustainabil­ ity (OECD, 2020; Yousfaoui & Yousfaoui, 2020), which are the types of quality and the prime parts of the Society 5.0. Quality management means intellectual honesty, holistic cooperation, qual­ ity integrity, and scientific approach to decision-making (Galetto, 1999). It is a practice to provide present and potential customers with support to enhance their satisfaction with the company and its products and services (Spasojevic Brkic et al., 2013). Quality management is the act of managing all activities and tasks needed to sustain the desired level of excellence (Zhang et al., 2012). It comprises the determination of a quality policy, creating and implementing quality plan­ ning and assurance, and quality control and quality improvement (Yu et al., 2020) that can be done effectively and efficiently through a system of keeping enough inventories to fulfill the customer orders based on their needs and requirements (Maguad, 2006). It focuses on the different activities and tasks within an organi­ zation to ensure that products and services offered (Sadikoglu & Zehir, 2010), as well as the means used to provide them, are consistent. It helps to achieve and maintain a desired level of quality within the organization to increase its busi­ ness through customer satisfaction (Yu et al., 2020). There are four main elements of quality management: quality planning, quality assurance, quality control, and quality improvement. Quality management is focused not only on product and service but also on the means to achieve it (Kaynak, 2003). Besides this, there are the seven principles of quality management: engagement of people, customer focus, leadership, process approach, improvement or always searching the room for improvement, evidence-based decision-making, and relationship management (Ngambi & Nkemkiafu, 2015). All seven principles are directly connected with getting a team(s) involved in the management system; focusing on the customers and their needs; developing a strong management team; creating a process culture; driving continual improvement; base your decisions on real and scientific facts and figures; and develop mutually beneficial relationships with suppliers and all other stakeholders, respectively (Besterfield et al., 2012; Krajewski et al., 2013; Shamsuddin & Masjuki, 2003; Spasojevic Brkic et al., 2013). There are four qual­ ity management components, that is, plan, do, check, and act known as a quality management framework (Bereskie et al., 2017). The planning process consists of the identification of goals; assembling internal resources; determining the re­ quirements to meet the standards of the quality; and determining the procedures to use to ensure the criteria. The doing process consists of the organization of the supporting documents, that is, policies, procedures, training materials, work instructions, etc.; training of employees on modern lines; and deploying the qual­ ity management system. The checking process consists of controlling, measuring, and monitoring the outputs to ensure to meet the criteria and to identify the areas of improvement in the system and its production. The acting process consists of the reviewing process to find the quality management system; re-evaluating the

Client and Value in the Quality Management 61 process and product processes; and beginning the quality management process again and again as per needs and requirements till the achievement of expected outcomes (Realyvásquez-Vargas et al., 2018). Because quality management is important to help organizations to achieve greater consistency in tasks and ac­ tivities (Nguyen, Nguyen et al., 2020) to increase and improve the production of products and services, it increases efficiency in processes, reduces wastage, and improves the use of time and other resources (Lundkvist et al., 2014) to en­ sure customer satisfaction for the betterment of the stakeholders to move toward sustainability (Meiling et al., 2014), a major and fundamental requirement of the education system of Society 5.0. 4.3

Relationship Between Client, Value, Society 5.0, and Quality Management

The relationship between client, value, Society 5.0, quality, and quality manage­ ment starts from the central phenomena of Society 5.0. The definition of Society 5.0 focuses on human beings and their development in all aspects (Alm & Gut­ tormsen, 2021), as it is a human-centered society that keeps the balance between economic advancement with the resolution of social problems (Cooke et al., 2022) through highly integrated cyberspace and physical space (Australian Human Rights Commission, 2021). The citizen’s first civic identity is transnational that includes humanity in its worldview (Bush, 2020), which is not limited to the human dimen­ sion but recognizes the foundation of life, that is, human life, its nature, and values (Ihemezie et al., 2021). The data are gathered by the Internet of Things (IoT), a great combination of networks to convert them into information and knowledge to deal with the real world through human-centered competencies (Feeney et al., 2022). Therefore, it is also called a data-driven society (Richardson, 2021), which is considered a system of interrelated mutually dependent parts (Pothong et al., 2021) that cooperate with each other to preserve a recognizable whole in order to satisfy the purpose to achieve the maximum goals through establishing a strong social system that is described as an arrangement of social interactions (Barassi, 2019) based on shared norms and values. The social system refers to an arrange­ ment of interrelationships to fix the place and define its role to play it prominently (Pothong et al., 2021) within the rules and regulations for the betterment and sus­ tainability of every stakeholder of Society 5.0. The social system consists of mutual interactions, interrelations, and the benefits of the individuals (Cooke et al., 2022) that structure, modify, and develop the formal and informal relations between the individuals, groups, and organizations to make, modify, and implement the rules and regulations for all. The fundamental elements of the social system are Faiths and Knowledge, sentiment, end goals and objectives, ideals and norms, status, role, power, sanc­ tion (Cooke et al., 2022), etc., which connect all stakeholders to create the char­ acteristics in the systems, that is, a plurality of individuals, achievement of aims and objectives, the constitution of orders and patterns, functioning of unity rela­ tionship, maintenance of the physical environment, create linkages with culture,

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Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser

Figure 4.1 Relationship between client, value, quality management, and Society 5.0, made by authors with the help of literature

and maintenance of balance for a happy, peaceful, and prosperous life (Alm & Guttormsen, 2021). In this connection, the social structure of society works ef­ fectively and efficiently, which purely consists of the four components: adapta­ tion, goal attainment, integration, and latency to settle down in the environment (Bereskie et al., 2017; Realyvásquez-Vargas et al., 2018), to achieve the pre­ determined goals, through working and sharing together, with a high level of motivation of responsibility. Society 5.0 can be the best place where every intervention would depend on the needs and requirements of the human beings (Potočan et al., 2020), that is, physi­ ological needs, psychological needs, social needs, self-esteem, respect (Sheldon et al., 2001), etc., which will be settled down through the scientific interventions based on the collected data about the stakeholders who are living in it (Sfreddo et al., 2021). The human beings of Society 5.0 will need qualified human and mate­ rial resources to make their systems updated, which can be done through quality ed­ ucation through quality management by describing their values in advance through some clients by the clients for the clients. Here, the client is most important but cannot be survived without the values because values make the clients important and that importance can be achieved only through quality education, managed by highly qualified professionals and researchers. Society 5.0 plays its role as an intel­ lectually revolutionized society to achieve its goals through a quality management process depending upon the problem-solving and valued-added approaches with the phenomena of values maintenance through the characteristics of respect, hon­ esty, and integrity by the client for the client of the client keeping their satisfaction assurance. Because Society 5.0 connects the people, things, and systems together through cyberspace and obtains optimal results through artificial intelligence (AI),

Client and Value in the Quality Management 63 which is exceeding the capabilities of humans fed back into physical space to bring new value (Batavia & Nelson, 2017) to industry and society. 4.3.1

Quality and Quality Management in the Context of Client, Value, and the Society 5.0

According to (Tricker, 2019), quality management is the act of managing vari­ ous activities and tasks within an organization to ensure that the products and services offered and the means used to deliver them are consistent. This helps to achieve and maintain the desired level of quality within the organization. Quality management ensures high-quality products and services by eliminating defects and incorporating continuous changes and improvements into the system. Highquality products, in turn, lead to loyal and satisfying customers, bringing in more new customers (Prasetyo & Arman, 2017). By comparison, quality control is the act of overseeing all the activities and tasks necessary to maintain the desired level of excellence (Pereira et al., 2020). Quality control includes defining quality policies, creating and implementing quality plans and assurance, and quality con­ trol and quality improvement. At the same time, clients and value are at the fore­ front whenever a product is good (Batavia, & Nelson, 2017), even if the price is high. High-quality products create unwavering customer loyalty that creates more leads. When a customer finds a product he/she can trust, they go back and buy it again and recommend the product or service to others (Carayannis & Jancelewicz, 2022). Quality management has different principles in the context of value and client management. These principles include leadership, control, assurance, ap­ proach, relationship, focus, and value service (Batavia & Nelson, 2017) for clients.

Quality Management

Assurance

Focus

Leadership

Approach

Value

Control

Relationship

Client

Figure 4.2 Quality management process made by authors with the help of literature

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Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser

4.3.2 Quality Assurance and Satisfaction as a Prerequisite of the Society 5.0

Doing the right thing at the right time has not always been the definition of quality. Solutions that are developed and produced in a way that is sustainable are currently the focus of operations and the demand for them. Sustainable development as a whole should be the goal of all organizations, and this includes doing things that help society in some way (Deleryd & Fundin, 2020). Achieving the company’s commercial objectives requires a high degree of quality. The source of our compet­ itive advantage, quality, must remain a defining feature of our goods and services. High quality is not a necessity that must be met; it is not value added. Quality relates not only to the final goods and services provided by the business but also to the methods employed by its personnel in the production of such goods and services (Matytsin & Rusakova, 2021). The working process ought to be as productive as feasible and continually enhanced. The most valuable resource for raising quality is a company’s workforce. The efficient and ongoing improvement of their work processes is the responsibility of every employee in every organiza­ tional unit (Manghani, 2011). Quality has never always been the right thing to do the right way. Currently, the focus of demand and activity is on solutions that are developed and produced in a sustainable way. All organizations need to contribute to overall sustainable development, including actions that benefit society in some way or the other (Onday, 2019). In a nutshell, through changes in staff, procedures, and structure, quality initiatives can only succeed with ongoing sponsorship and support from senior leadership. Additionally, designated resources are essential for assisting with these endeavors. 4.3.3

Respect, Honesty, and Integration as the Key Indicators of Values in the Society 5.0

Social, economic, and organizational systems are generally at the forefront of so­ ciety, leaving gaps in the products and services that individuals receive due to their abilities and other reasons. Society 5.0, on the other hand, provides a high degree of convergence between cyberspace and physical space, enabling big data and robot-based artificial intelligence to perform or support the tasks and adaptations that humans have traditionally performed as agents (Rojas et al., 2021). This frees people from the daily and tedious tasks and tasks they are not particularly good at and creates new value that enables only the products and services that need to be provided to those who need them at the time of death. The entire social and or­ ganizational system is optimized. Some of the most important elements of Society 5.0 are respect, honesty, and inclusion. Honesty is based on truth and the ability to respect oneself and others. Honesty is a fundamental asset for creating trust and respect. Honesty is very closely related to humility and respect (Xu et al., 2020). Society 5.0 emphasizes that we should be honest with ourselves and, of course, with others. Honesty is the quality of having strong ethical or moral principles and always following them. An integrated society or Society 5.0 acts honestly, honorably, and honestly. Moreover, honesty was understood as an obligation to find the truth

Client and Value in the Quality Management 65 and live according to it. Honesty is a virtue that means refusing to tamper with the facts. Honesty is the most prominent expression of self-esteem and respect for others, and there is no self-deception or concession to other deception (Dahlgaard-Park et al., 2018). Similarly, respect encompasses everything from how you speak to people (your tone and language) to the content of what you say. It means accommodating everyone to the best of your ability. You are more likely to win than lose if you continue with the intention of connecting and growing through communication; and even if you do not succeed, the fact that you tried usually gets you another chance (Lundie, 2022). We are able, to be honest, and respectful consistently across all levels of our endeavors, regardless of who we are dealing with, even when no one is watching or there is no direct gain for us. This is what we mean when we talk about integrity. We should al­ ways present ourselves in a positive light because we adhere to our character and value systems and because doing so makes us feel good. Again, despite the fact that this may appear to be an extremely risky practice that could be threatened in a variety of circumstances, it actually requires less effort once it has established itself as a routine. Starting with clear intentions about what we stand for and where our boundaries are when those beliefs and values are challenged is necessary for these things to become a culture for us as individuals and for us to demonstrate them loudly and consistently enough to permeate a team. One thing is to profess our values (Grigo­ ryan et al., 2018). Another is adhering to them and defending them. We all make mistakes from time to time. We are all human, so when we see something that goes against our values, we frequently get angry and react. When that happens, it takes a strong and well-practiced approach to remain calm and centered. Being part of a team that shares a common set of values and is willing to stand together and have each other’s back makes this 100 times easier. Adults, like children, are drawn to boundaries subconsciously. Whether or not they agree with you, people feel at ease and secure when they know what to expect. After that, it is up to them to decide if they want to be a part of what you show, but this is the way your tribe gets together with you. However, understanding how trust is earned through honesty, respect, and integrity is only one part of the equation. Actually, the harder part is actually doing it (Seibel, 2019). How does one get a team to cooperate in this manner? How is that space created? There is only one choice that makes getting started simple. The only thing you can do is what you do, and you decide how you show up. You make it clear. You set the standard. The fact that we need to be vulnerable in order to attain this mythical space that we all desire is the most significant ob­ stacle standing in our way. Vulnerability is required for honesty. Vulnerability is necessary for respect, especially when you have to ask for what is required. When you consistently choose to stand by your beliefs, integrity implies vulnerability (Paliszkiewicz, 2019). Furthermore, being vulnerable is extremely uncomfortable. People do not want to be vulnerable in a place that could destroy that vulnerability. 4.3.4

Adaptation of Problem-Solving and Value-Added Approach in Society 5.0

Society 5.0 collects large amounts of information from sensors in the physical space of cyberspace. In cyberspace, this big data is analyzed by artificial intelligence (AI),

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Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser

and the results of the analysis are reported to people in physical space in various ways (Gladden, 2019). Society 5.0 empowers workers and addresses their evolv­ ing skills and training needs. It helps to make the industry more competitive and attract the best talent. Society 5.0 has modernized much of the world and is chang­ ing the patterns of human settlement, work, and family life (Shiroishi et al., 2018). Society faces an unprecedented challenge in adapting to global change. Adaptation is typically framed as a decision problem by decision-makers, with existing deci­ sion processes centered on defining the problem and choosing options serving as the framework for addressing responses to changes. However, the current state of knowledge, societal values and principles, and norms limit this “decision-making perspective.” As a result, it is unsuitable for dealing with cross-scale, complicated, and contested issues. We argue in this chapter that simply taking institutions and values into account when making decisions is insufficient (Gorddard et al., 2016). We argue that the “decision-context perspective,” which focuses on how the soci­ etal system of decision processes influences the manner, in which a specific prob­ lem is addressed, must be connected to the “decision-making perspective.” Values, rules, and knowledge (VRK) are all interconnected in the decision context, as we define it. Similarly, understanding how people can intentionally influence the so­ cietal context of a decision-making process is necessary for adaptive governance (Giddens, 1984; McLaughlin & Dietz, 2008). This dual relationship between social structure and the human agency has been extensively theorized, but conceptual di­ vides persist. Additionally, problem-solving, or the social routine in which people with defined roles evaluate options, make a choice, and choose one, is our focus here. We focus primarily on public decision-making processes, where the choice is meant to affect people’s behavior outside of the decision-making process. In contrast, an understanding of structural change can be used to empower individu­ als to direct societal change and provide information (Loorbach & Rotmans, 2010; Safarzyńska et al., 2012). Eventually, the decision-context perspective, on the other hand, focuses on how social structures affect how decisions are made. This struc­ tural perspective focuses on the societal structures that define the roles of actors and whether or not those roles enable actions that are both effective and legitimate, rather than the specific problems that need to be solved using the existing decisionmaking processes. By describing the problem-solving and value-added approach context as a VRK system, we aim to make these societal structures discernible from the perspective of decision-making and problem-solving and value-added ap­ proach. From the perspective of the decision context, values, rules, and knowledge are interdependent conceptual systems that represent a particular way of viewing and framing the world (Baumgärtner et al., 2008; Blackman & Moon, 2014). 4.3.5

Society 5.0 as an Intellectually Revolutionized Society

An intellectually revolution is a period of paradigm shift or change. Scientific be­ liefs have been widely accepted by people (Salgues, 2018). The basic intellectual and humanitarian goal of the intellectual revolutionized society is to help humanity, acquire wisdom, and identify (imagine and create) what is valuable to oneself and

Client and Value in the Quality Management 67 others in life. Therefore, wisdom includes knowledge and technical know-how, including its proper utilization. Similarly, human society is constantly moving to­ ward changing ideas, customs, and concepts (Konno & Schillaci, 2021). A new intellectual movement aiming at advancing society and enhancing human value at all levels and in all spheres of life will be sparked by this movement, which is an intellectual movement that shifts momentum to the engine of action. The elitist class of intellectuals is responsible for the creation of ideas such as philosophical, social, economic, or educational theories (Popkova & Gulzat, 2019). No matter how small or large these categories are in terms of size or importance or how much they weigh in the balance of society, they have a comprehensive vision of man and society along with a piece of deep knowledge and understanding that is emanating from the ground to mobilize all social groups and inspire them to play their part in society (Mischi, 2021). It is also well known that intellectuals have a fundamental knowledge of a variety of current or well-known intellectual topics as well as an undisputed understanding of a variety of facets of social, political, economic, and educational life. And while all of this is fundamental, it is important for the truly sophisticated intellectuals to apply this information in order to build the capac­ ity to track the rate of social development or decline in the aforementioned areas (Esquivel-Sada, 2022). Additionally, they should be able to recognize the social and intellectual issues that each community faces as well as the signals of change that appear when global change is prevalent on all levels of society (Secundo & Lombardi, 2020). Having said that, not everyone with even a little expertise in a given profession has the ability to shape his surroundings or assume the role of the intellectual and expert, as demonstrated by observation, characterization, and analysis, followed by solutions, concept defense, and change advocacy. Influence derives from the cultural man’s actual belief that he needs to use his knowledge, ideas, and insightful visions for the benefit of humans and society. Therefore, it is pointless that the mere possession of particular knowledge is merely the property of an influential individual who does not go beyond the influence of a civilized person and is merely another feature of many others of his personality (Zlobin et al., 2021). Having said that, the more the intellectual functions as a witness to the problems of his society, the more his culture is a product of the individual’s privacy and his vast intellectual scope, and the more his sense of community causes him to feel connected to societal problems. As a result, we can be more confident that intellectuals will play a bigger, healthier, and intellectually sharper role in society (Bui &Tseng, 2022). 4.4

Role of Intellectuals in Building an Intellectually Revolutionized Society 5.0

The strength of the intellectual’s position or significance in society does not come from the subject matter of his or her work, how they communicate their ideas or the areas of interest they are most focused on (Shah & Kanishk Pandey, 2022). In­ stead, it results from his or her steadfast and unwavering belief in the significance of any work that can be seen as adding value to society, whether in its artistic or

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Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser

aesthetic form or in the category of reforms that calls for the targeting of gaps that, if neglected, widen to become significant social gulfs (Hysa et al., 2021). Therefore, one’s capacity for analysis, expression, and production of a particular intellectual or creative output—and, more crucially, his ability to use and channel it as an interac­ tive social product with a vision or goal is what truly define one as an intellectual. Therefore, educated people work to ensure that the intellectual and social regen­ erative movement remains a continuous cycle, whether they are activists trying to found organizations that deal with vulnerable groups and their stolen rights, political activists trying to found parties that carry ideas aimed at both the governmental and social systems, or even writers and journalists who devote their pen to social and political criticisms. Intellectuals, whether artists who use pencils, theatrical perfor­ mances, and even large screens to present their own works of painting that represent different goals and backgrounds, are useful in assessing society and social phenom­ ena (Ferreira & Serpa, 2018). Whether you are a thinker who spends most of your time, and regardless of whether cultural activities have a positive impact, the art and intellectual movements represent a strong cultural role and a fortress of long-term maintenance. But history does not testify to either name that was the art of the world and did not polish the world of thought and works, but it still had the greatest impact on people’s lives. It is known in both ancient and modern history that there are many examples of intellectuals who have had such great influence and have been the main drivers of major changes in political and social societies (Ma et al., 2020). 4.4.1

Role of Educational Leaders and Managers to Manage and Maintain the Quality Education in the Perspectives of Client, Value, and the Society 5.0

Educational leaders are the qualified and trained officials who work for the profits of their organizations (Day et al., 2016; Lamer, 2018) in the collaboration of different stakeholders and process. The main role of the educational leaders and managers is to improve, manage, and enhance the quality education (Sahito & Chachar, 2021) through transformation in the Society 5.0 (Alfadala et al., 2021; White & McCallum, 2020). The primary purpose of educational leaders and managers is to ensure aca­ demic success through proper and scientific implementation of rules and regulations through collaboration with all concerned partners (Day et al., 2016; Leaver et al., 2019). Educational leaders and managers focus on the proper implementation of the principles to support the learning system (Ezzani et al., 2021; Shakeshaft et al., 2014). Therefore, the role of educational leaders and managers must do the following, that is, educational leaders and managers: 1. Create and achieve the vision and mission of the organization and program in the collaboration of SDGs goals to achieve the aims and objectives of Society 5.0. 2. Provide clear directions to prioritize the focus and the attention of all stakehold­ ers to achieve the required outputs (Childress, 2020) of the smart Society 5.0. 3. Minimize every type of distance and gap between students, teachers, and parents that create inferiority and superiority complexes to threaten the rules and regula­ tions of equality, equity, and justice (UNESCO, 2017) required in Society 5.0.

Client and Value in the Quality Management 69 4. Struggle to maintain a conducive learning environment for all stakeholders (Parkin, 2022; Youshida et al., 2014) to increase and enhance the teachinglearning process required by Society 5.0. 5. Manage a conducive school and classroom environment for formal and nonformal education systems to provide quality classroom instructions required by Society 5.0. 6. Do pre-planning to design the student-centered policies to facilitate the learn­ ing process required by Society 5.0 to provide freedom to smart people. 7. Delegate their powers, duties, and responsibility to their teammates to deal with day-to-day matters easily and accessibly to make smart people responsi­ ble in their Society 5.0. 8. Empower the stakeholders to take responsibility and accept accountability through active participation and decision-making (Gates et al., 2019; Youshida et al., 2014) to cultivate leadership skills for future developments of Society 5.0. 9. Support their teammates to review, revise, and upgrade their instructional methods and materials (Alfadala et al., 2021; Spillane et al., 2019) to achieve the aims and objectives of Society 5.0. 10. Appreciate their colleagues to borrow, adapt, and utilize the best tools and practices of the world effectively and efficiently to update the education sys­ tem (Gates et al., 2019) in Society 5.0. 11. Understand well the importance of building community partnerships to build and sustain mutual partnerships and leverage to cultivate inclusive education. 12. Develop caring and culturally responsive systems and networks to develop trust and a sense of transparency to make all stakeholders responsible and smart as per the vision of Society 5.0. 13. Remain passionate about their work to appreciate and encourage others to be zealous about results while taking risks for any intervention (Jensen et al., 2017) to be a risk taker required by Society 5.0. 14. Appreciate the smart people to be lifelong learners as they believe to be active members required by Society 5.0. 15. Make learning systems effective through teachers’ and students’ active engage­ ment, satisfaction, and motivation (Gates et al., 2019) required by Society 5.0. 16. Be familiar and organized with their duties and responsibilities to manage, maintain, and improve the learning system (Gray, 2018) to make people smarter required by Society 5.0. 17. Design an effective system to check students’ regularity and punctuality through social relationships with all stakeholders (Breakspear, 2017; Giesbers et al., 2019) required by Society 5.0. 18. Connecting people and taking them on board for community development to work effectively and efficiently for the creation and management of Society 5.0. 19. Develop a system that has the capacity and strength to choose the tools and techniques that are technology-friendly or mobile-friendly to be used for ac­ tive learning (Kesler et al., 2022; Phelps, 2008) in Society 5.0. 20. Focus on the system of modern pedagogical techniques, that is, the pedago­ gies of engagement or engaging pedagogies like project-based learning, etc., to make the students active and highly engaged (Kesler et al., 2022) in Society 5.0.

70 Zafarullah Sahito, Raja Bahar Khan Soomro, and Anna-Marie Pelser 21. Provide professional training facilities to all stakeholders to enable them to use the different tools, techniques, and plate forms effectively and efficiently for getting maximum outcomes (Onwujekwe et al., 2022) to become experts required by Society 5.0. 22. Support their faculty members to monitor, assess, and evaluate every activity through scientific and empirical evidence (Onwujekwe et al., 2022) to achieve the maximum goals of Society 5.0 for future sustainability. 4.5

Issues and Challenges of Quality Management With Their Solutions

Management of quality education in Society 5.0 is directly connected with the values of clients or inhabitants. Quality management is a strategy to upgrade, update, improve, and enhance the education system that gives universal access to people of the world to fulfill their needs and requirements aligned with so­ ciety. The main benefit of quality education is Education for All and No Child Left Behind with a special focus on controlling the dropout rates (Bilgiç & Tu­ zun, 2020). Quality management of education facilitates students who may face situational, attitudinal, psychological, and pedagogical problems (Montgomery, 2020; Prinsloo et al., 2022) in their regular studies and programs. They may face sociocultural and instructional problems (Bristol, 2009; Yilmaz, 2017), that is, nonconductive learning environment that make them weak to not handle their coursework (Beaudoin, 2016) due to a lack of skills in time management, de­ mands of their family, job, and studies (Kember, 1989) and study materials, so­ cial and economic duties and responsibilities, and insufficient learning assistance (Badat, 2005; Williams, 2003). The following issues and challenges can be faced in the management of quality: 1. Unavailability of expert educational leaders and managers to follow and im­ plement the philosophy of the management of quality education in Society 5.0. 2. Unavailability of educational leaders and managers to avail and utilize the required finances, especially in the developing world. 3. Unavailability of organizations to make available all needed items to follow and implement the philosophy of the management of quality education in Society 5.0. 4. Non-serious attitude of organizations, leaders, and managers toward the imple­ mentation of the system of quality education in Society 5.0. 5. Untrained curriculum experts to design the scientific curriculum keeping the needs and the requirements of the learners, system, and situations to imple­ ment the management of quality education in Society 5.0. 6. Unavailability of the writers to meet the needs and the requirements of the ap­ propriate contents of the books or materials to publish for quality education in Society 5.0. 7. Untrained faculty to follow the instructions properly to use the published ma­ terials efficiently and effectively to fulfill the needs and requirements of the learners and the systems to manage the quality of education in Society 5.0.

Client and Value in the Quality Management 71 8. Untrained faculty to follow the instructions of the technological systems to implement the required ICT instruments properly, efficiently, and effectively to fulfill the needs and requirements of the learners and the systems to manage the quality of education in Society 5.0. 9. Unavailability and inappropriateness of required systems, that is, computers, online platforms, and other ICT instruments to manage the quality of educa­ tion in Society 5.0. 10. Unavailability of the internet with good speed to deal with the needs and re­ quirements of managing the quality of education in Society 5.0. 11. Unavailability and inappropriateness of pedagogies, their materials, and their utilization to manage the quality of education in Society 5.0. 12. Unavailability of technical experts of content, pedagogies, philosophies, psy­ chologies, and technologies to manage the quality of education in Society 5.0. 13. Unavailability of researchers in the fields to follow the philosophy of the qual­ ity education system properly to manage the quality of education in Society 5.0. 14. Unavailability of the expert educational leaders and managers who make rela­ tionships between clients, values, and quality management in the perspectives of Society 5.0 philosophy and ideology. 15. Acceptance of the concept of Society 5.0 by all stakeholders to start the think­ ing and researching to conceptualize its nature multidimensionally to reach the maximum level of the philosophy of the phenomenon. 16. Arrangement of orientation after reaching the top of the phenomenon multidi­ mensionally to understand the concept in a real sense and make all stakehold­ ers ready to start working on it. 17. Start funding through research projects to different researchers and research groups to work on it with interdisciplinary and multidisciplinary approaches to develop the scope of the field. The solutions and recommendations to the previous issues and challenges are to take the system of quality education seriously through an understanding of its philosophy and the needs and requirements of the stakeholders and Society 5.0. Financial support must be available to purchase every type of tool(s), method(s), and material(s) to upgrade and update the systems linked with the philosophy of Society 5.0. The required experts and researchers must be appointed and profes­ sional growth and developmental facilities, and opportunities must be available to upgrade the line of experts and professionals. The research teams must be devel­ oped to focus on the interventions, and their results must be utilized and the incor­ poration of the new materials and methods and instruments for future endeavors. Through research new trends and techniques can be identified and implanted for further value addition and the smooth running of the systems. 4.6

Conclusion

Quality education provides the opportunities to develop wisdom in order to make sensible decisions in the life of individuals that effects positively on the life of

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themselves and others who live in the same society. The wise decisions make peo­ ple responsible citizens of any society who fulfill their duties and responsibilities with honesty, dedication, and commitment through scientific processes to maxi­ mize the common benefits of the individuals. These societies believe in their social processes to prepare all their members for future endeavors to live a happy and prosperous life without any discrimination and victimization or threats. Society 5.0 believes that every facility for happy and prosperous life can be achieved through the development of quality education that opens the doors toward the advance­ ment in the field of philosophy, psychology, sociology, science and technology, etc. for prosperous economic development. Finances are very much necessary to bring radical reforms in all types of walks of life especially quality education. Nowadays, education is considered a multifaceted, multidirectional, and multidimensional en­ tity to learn through different styles, ways, and systems, directly connected with the quality management mechanisms and research-based systems. Furthermore, Society 5.0 has been described by researchers as a human-centered society in which regional-oriented solutions will be found for their sustainability, which can be possible through quality educational systems that are strongly connected to the relationships between technology, human welfare, and sustainability. Where all members will be able to use technology on an equality, equity, and justice basis to work for their mutual benefits and future sustainability of all stakeholders, for achieving sustainability, the members of Society 5.0 must be highly educated to work as experts and professionals to achieve the predetermined goals through a strong and updated education system developed by quality management systems. 4.7

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5

Transformation Customers Needs in the Aspect of Client Value Aditya Halim Perdana Kusuma Putra

5.1

How Did This Start?

The German government first echoed the term “Industry 4.0” at the Hannover Fair in 2011. The Industry 4.0 definition quoted by the German government later be­ came an essential term in the history of the new human civilization. The German government stated that to make the industry advance to the next level, the role of the machine combined with the sophistication of artificial technology and comput­ erized systems became the solution. Starting from diction and a proposition, it then massively developed into a revo­ lutionary movement known as the Industrial Revolution 4.0. This phenomenon, in conclusion, describes the elaboration of cyber technology and automation technol­ ogy. The application concept centers on automation, assisted by information tech­ nology and computerized systems in the application process. The bad news from it all is that the involvement of human labor in the process is reduced. The goals and objectives to be achieved in Industry 4.0 are to further re-establish the definition of innovation and overall improvement in all production processes and distribution lines to create measurable and targeted supply and demand. Thus, the effectiveness and efficiency in a work environment can be optimal—an exciting and scary idea. An interesting question is why were this term and movement called “Amen” by the whole world? Things that worry many scientists and practitioners around the world, especially those from the scientific fields of industrial technology, man­ agement, strategy, economics, and business, are how to realize effectiveness and efficiency from time to time. The view that directs attention to the importance of effectiveness and efficiency was first noted by Levy and Hanoch (1970) in finance and investment; the stock market also marked the birth of the risk aversion theory. However, what has been initiated by Levy up to 1975 seems to be closer to the care­ ful calculation of risk, so the impression that emerges later is an improvement that considers it necessary to include the macroeconomic condition variable initiated by Mishkin (1983). What was written by Mishkin (1983) illustrates the linkage model of policy ineffectiveness and efficiency in the market. Although what Mishkin had written in 1983 came under sharp criticism a year later by Sheffrin (1984), who argues that the forecasting method used by Mishkin is considered very weak.

DOI: 10.4324/9781003404682-5

Transformation Customers Needs in the Aspect of Client Value 83 5.2

The Diction That Continues to Evolve

The development of the definition of creating effectiveness and efficiency does not stop there. The meaning of observing, assessing, and testing the essence of effec­ tiveness and efficiency is transformed into how to outperform the competition by Porter (1989). The breakthrough produced by Porter (1989) is a well-established model to date, namely the Porter’s Diamond Model (a model that describes the five elements for achieving competitive advantage). The birth of Porter’s Diamond Model can be assumed to implement eight suggestions for achieving competitive advantage by South (1981), where South, in his study, provides eight forms of advice as well as in-depth reflection on the essence of competitive advantage. First is an in-depth definition of the business itself. This means contemplating what the product is made for and for whom it is created, limiting the scope of business, and defining the strong competitors. Second is the main key factor for a business to succeed (e.g., market share, investment, and support systems that become a safety net for the business as long as it operates for a certain period). The third is the analysis of the business situation, including SWOT analysis. Fourth is to formulate superior or unfavorable factors in competing. Then, after analyzing the formulation, the next step is to determine the fifth step, namely, a strategy that solves current problems and can formulate strategies to reach mar­ kets in the future (sustainable innovation). The sixth is forecasting, financial needs, profits, and absorbed costs. The seventh, namely, setting goals and objectives, in­ cluding how to market, manage, and produce. The eighth is the determination of planning. When examined, what South and Porter later believe has a deep philo­ sophical meaning that it is essential to think about and analyze risk factors to ex­ tract effectiveness and efficiency, but not necessarily, because the risk factor is the barrier to creating profitability through productivity. South and Porter’s ideas also explain that efficiency and effectiveness can be judged according to the activities’ density. This justifies the anonymous proposition that “the busier a person is, the more he can manage his time.” This is the meaning of effectiveness and efficiency. The era of competition was then more developed and faster. What was initiated by Porter (1989) and South (1981) increasingly inspires scholars in strategic man­ agement to continuously seek to find out the answers behind the phenomena that occur in the world of fierce competition. Barney (1991), who sparked the theory of competitive advantage in the modern world, namely the resources-based view (RBV) theory, as if to reaffirm what was stated by Porter (1989) the primary key to maintaining competitive advantage is to pay attention to the core factors of an organization through the competitive edge and comparative advantage possessed by the organization as the primary weapons to penetrate the storm of competition and differentiate one organization from its competitors. Furthermore, Barney then re-writes a long 10-year journey about RBV, emphasizing the orientation that busi­ ness people must have to compete: market orientation, orientation to customers, and coordination between functions (Barney et al., 2001). Day (1994), who also uses RBV as his research background, adds profitability and growth variables, which are his primary concerns and are a novelty in his

84 Aditya Halim Perdana Kusuma Putra study. Along with developing the resource-based view, which Porter initiated in 1989, Barney (1991) and Day (1994) popularized the theory in strategic manage­ ment, namely resource capability theory (RCT). Both Barney, 1991 and Day, 1994 express that to achieve long-term benefits, one must obtain close and easily acces­ sible resources, and then these abundant resources must be able to be developed and converted so that they are of value. Economical to achieve these long-term profit goals. RCT in the concept of competitive advantage essentially explains that valuable, rare, or superior resources that are difficult to imitate by competitors and cannot replace the position of an organization can guarantee the long-term success of an organization. The idea of RCT combines organizational capabilities in man­ aging all forms of resources that can provide added value to customers and create distinct advantages over competitors. RCT also has changed meaning over time; wise warnings about massive natural resource exploration activities based on productivity and long-term economic value seem to be an essential warning. Hart (1995) was one of the scholars who made that critical hint; Hart stated that the long journey of management theory since the RBV and RCT became the firm grip of scholars and practitioners in management has ignored environmental conditions. Pollution is one of the harmful effects left by RBV and RCT even today. In his study titled “A-Natural Resource-Based View of The Firm,” Hart outlined brought a cool breeze of change in responding to prob­ lems in production activities, such as pollution prevention, product stewardship, and sustainable development. Furthermore, what Hart believes leads Teece et al. (1997), which then sparked a theory called dynamic capability theory (DCT). In the DCT concept, Teece et al. (1997) explain that the critical concern about the impact on the environment is an effect that must be taken into account. Still, mas­ tery of the essence of the resource should be further developed. Teece et al. (1997) reiterate the problem of resources, as whatever resources are owned will eventually run out and shrink. Therefore, seeking and creating new resources must provide a sustainable competitive advantage. DCT then extracts three essential elements: the importance of internal-external coordination of the business environment, the learning process, known as “knowledge management” and “knowledge-sharing,” and the reconfiguration of these resources. What is interpreted in the concept of DCT by Teece et al. (1997) argue with Day (2014). Even what was initiated by Hart (1995) and Teece et al., (1997) succeeded in establishing another well-established theory that became a reference for many scholars around the world, which was initiated by Elkington (1997), which includes the three pillars of sustainability (i.e., profit, people, and the planet). The triple bottom line theory, coined by Elkington (1997), also managed to break through many disciplines, not only exacta but also social-humanities, such as accounting, which not only focuses on financial record­ ing and reporting activities but also pays attention during a financial recording pe­ riod, which not only is obliged to provide financial benefits to the organization but also has an impact on the organization to the environment and society. We know it by “corporate social responsibility” (CSR). The idea that has been coined by Elk­ ington (1997) is believed to be the basis for the birth of the government agreement movement around the world, namely the millennium development goals (MDGs)

Transformation Customers Needs in the Aspect of Client Value 85 in the early 2000s, which then narrowed it down to the noble idea of creating a better world situation, activities an economy that is more environmentally friendly and has an impact on reducing various social inequalities that we know today as the sustainable development goals (SDGs). 5.3

The Industrial Revolution: Why It Happened, and What Was Born of Each Change in the Industrial Revolution

There is a significant difference between revolution and evolution; many of us understand that the two terms are different. However, sometimes an error occurs when placing the word in a phrase, sentence, or expression. Evolution by definition is progress or change that occurs steadily and slowly. At the same time, revolution is an extreme change that can be total or partial in various spheres of life but is very fast, even difficult to predict. Such is the picture of what is happening in the indus­ try; it happens so fast, and sometimes its presence is difficult to predict. The industrial revolution movement has been going on for a long time, various forms of revolutionary events. Still, the entire event was initiated by the industrial revolution in England in 1760–1830. The enormous revolution momentum in the history of humankind is in the industrial sector, which packs the role and urgency of technology that aims to make people’s lives easier. At that time, what was hap­ pening in England finally triggered the French revolution in 1789–1799. However, the French revolution in question is a revolution that is identical to a radical social and political movement. However, the French revolution had an impact on Europe as a whole. Discussing these two things is very important because of what the world community has enjoyed until now, ranging from philosophy, art, economics, politics, and legal consensus to technology, started by the European community. Europe is the center-of-view of it all; Europe is the initiator of changes in human civilization toward modernization. • What happened in the two examples of revolutions described earlier is the socalled Industrial Revolution 1.0, which occurred in the eighteenth century, or to be precise, starting in 1784. Looking at the history of what happened in the eighteenth century, it can also be referred to as the “Aufklarung” period. In German, it means enlightenment. In this era, European society received enlight­ enment from the dark ages and a sense of optimism to advance in thought, sci­ ence, and technology. Even though it could not be separated from the influence of the Renaissance, as the previous movement originated from the bitter pill of empirical behavior, the “Aufklarung” movement spread throughout Europe, especially in the United Kingdom, France, and Germany. The “Aufklarung” movement was caused by several things, namely the debate between the church and politicians who ultimately wanted to separate the church’s interests and the state. So what happened at this time? The revolution in this first stage was marked by the previously manual and traditional work processes turning into mechanical-based production. In this era of Industry 1.0, steam-powered equip­ ment was introduced, and looms were first introduced. This era is the stage of

86 Aditya Halim Perdana Kusuma Putra changing the world again, starting toward the direction of modernization as fast as the magnets of new human civilizations are popping up, such as classical economics, as a milestone in the history of modern economic thought by Adam Smith, which was later developed by Jean-Baptiste Say, David Ricardo, and John Stuart Mill. In Adam Smith’s work “The Wealth of Nations,” classical eco­ nomics is described as a free market that will regulate itself if other parties have no intervention. The “invisible hand” metaphor is the basic assumption driving Adam Smith in defining the market toward equilibrium (Smith, 1937). • In the era of Industry 1.0, the appreciation of rational thinking and empiricism was highly respected. Not only examples of world figures who were popular in that era such as Adam Smith in the field of Economics, Cesare Beccaria, who was a lawyer, criminologist, and politician with his work “On Crimes and Punishment” in 1764, and Francesco Mario Pagano with his work “Considera­ tion on the Criminal Trial” in 1787, who is a classical criminological thinker who popularized the criminal justice system in several countries that adhere to the European continental legal system. Including Indonesia, some of the legal principles based on the work of Francesco Mario Pagano are still the back­ bone of several criminal law systems in Indonesia (for example, thinking about positive law and the model of government and the legal order of the republic) (U.S. Sugiarto, 2021). The upheavals that occurred in the Industrial Revolution 1.0 era were in Europe and America; there was also a revolutionary upheaval that produced a perspective still rooted in American society, namely liberalism, which John Locke initiated (Cranston, 1986). In other parts of the world, after Europe and the Americas, there is Japan, which is one of the most developed countries in the world, entering an era of enlightenment known as the Edo Pe­ riod “Edo-Jidai” (in Japanese), which lasted for 264 years (1603–1867). The concept of revolution was not much different from what happened in Europe at that time; Japan ended the era of the Shogunate rule, which is also called the beginning of modern times in Japan. To better understand what happened in the events of the 1.0 revolution in Japan, readers can watch the documentary series released in 2021 by Netflix titled “Age of Samurai: Battle For Japan.” We must also remember that the most significant shock to human activity in the era of the Industrial Revolution 1.0 was The Great Plague in 1720 (see Devaux, 2013). • The Industrial Revolution 2.0 is an era where human movement, activities, be­ havior, and culture grow exponentially. In the nineteenth century, more pre­ cisely in the 1870s, the shift from Industry 1.0 to Industry 2.0 occurred a lot, especially in Industry itself as a center for producing goods and services to meet society’s needs. Mass production, assembly line, requiring labor, and the pres­ ence of electrical energy that replaced the steam-powered engine, which was the hallmark of Industry 1.0, were abandoned. What has been discovered in Indus­ try 2.0 is the conceptual and practical forerunner of products that still survive today. For example, Nicola Tesla was an electric power inventor, and Alexander Graham Bell was the telephone inventor. Thomas Alva Edison invented the in­ candescent light bulb, a photographic characteristic used today. In the field of health, Robert Koch explored Tuberculosis for the first time and Clara Barton,

Transformation Customers Needs in the Aspect of Client Value 87 a US heroine for humanity, was the one who came up with the idea to establish the Red Cross in 1881 after visiting Europe. • Do not miss the debate in economics that corrects the classic flow typical of Industry 1.0 also emerged, whose continuation is known as Neoclassical Eco­ nomics, which was initiated by Karl Marx and then followed by Carl Manger. The extraction of Karl Marx’s thought then turned into a form of idealism in the economy, which became the opposition to the typical US liberal economic system in Industry 1.0. According to him, Karl Marx put forward the view that communism is an excellent financial system; of course, what was left by Karl Marx is still an established ideology to this day in the state order as adopted by the present Soviet Union (Russia), China, and also North Korea. The events surrounding Industry 2.0 contain a lot about the history of wars and massive conquests by various European countries. In the production order system char­ acteristic of Industry 2.0, mass production is a production system that is the style and features of the prevailing standard, including the assembly line pro­ cess. As a common form of Industry 2.0 characteristics, the term “labor” was born in this era. The massive recruitment of human resources as operators to run machines is the main reason to support the concept of mass production to answer the increase in optimal production capacity. The logical consequence of the massive recruitment of human labor as a factor of production was firmly entrenched and became the paradigm of thinking of practitioners and academics in management strategy. Even the literature on the elements of production in many textbooks states this. At least, the doctrine of mass production and labor survived until it entered the 3.0 revolution era in the early twentieth century. Then, what happened to the world in the industrial era 2.0 besides war? Cholera, which wiped out part of human civilization, was recorded as a pandemic from 1817 to 1824 (see Chan et al., 2013). • After the first and second world wars, which resulted in many casualties, the massive movement to reconstruct world order and civilization entered a new phase. Revolution 3.0 was also present to renew the dominant traces of the leg­ acy of the 2.0 revolution in the twentieth century, precisely in 1969. At least the definition that persisted at least until early 2000 was “labor,” which was later refined to become “employee.” The description that considers humans as fac­ tors of production or as tangible assets has developed the term that even though humans are one of the factors of production, they can no longer be classified as tangible assets but intangible assets. Advances in management, particularly those dealing with quality, Edward Deming was one of the famous thinkers in the era of the Industrial Revolution 3.0 with his masterpiece, “Total Quality Management” (Razak et al., 2019) and Kaizen way extracted from the work philosophy of the Japanese work spirit; Plan–Do–Check–Act (PDCA) is a form of Kaizen work scheme whose system aims to correct errors or violations in the work process. Kaizen’s focus of attention is the analysis of problems related to inadequate practices; TQM means an overall improvement in all lines of good management. Kaizen and TQM aim to create a sustainable effect in business processes with a view to the organization’s continuous progress (Ahmad &

88 Aditya Halim Perdana Kusuma Putra Kusuma, 2020; Rosak-Szyrocka, 2017). The thinking sparked by Deming then expanded and was increasingly tested and practiced in the world of work, which brought a distinctive feature to the 3.0 industry movement: automated production and rapid technological advancement (Rosak-Szyrocka, 2016). The presence of technology giants such as IBM, Kodak, Nokia, Apple, Samsung, Microsoft, Cisco, and General Electronic as examples of giant technologyinitiating companies that introduce innovation to the world about computer­ ized systems and novelty in terms of communication technology. Then, in the automotive sector, BMW, Mercedes-Benz, Honda, Mitsubishi, Yamaha, Ford, and Toyota strengthen the direction of change in human civilization in terms of transportation and driving. On the other hand, to complement the lifestyles of people in Europe and America, who are the main characters in terms of technol­ ogy, the presence of Mc Donald’s, KFC, Pepsi, Coca-Cola, and Levis is no less significant in filling the gaps in the changing lifestyles of increasingly modern society. In the arts industry, the presence of musical art masterpieces by many legendary musicians, acting and theater, fine arts, and even the Hollywood film industry also adorns the long journey of the generation that was then known as the Baby boomers generation and Generation X. New entrants toward the end of the 3.0 industry change—marked by the presence of Amazon, Facebook, and Google which also enliven the competitive arena. The industrial era 3.0 can also be called a revolution that turned levers into buttons, closing the analog age and opening the digital era. • The fiercer competition between giant companies competing for innovation and strategies to show who outperforms the market is not only happening for the big industries fighting in the sky. Some new entrants are also born with the same goal; they want to enjoy the cake of competition for market share, namely SME. In the historical record that shook the economy with a terrible economic crisis, countries in the Asia continent to Southeast Asia survived, their economy supported by the economic revival of the household sector. For example, the financial crisis that hit Southeast Asia, Malaysia, Thailand, and Vietnam, in­ cluding Indonesia, is an example of countries that have finally risen against the devastating onslaught of a hostile economic wave (Arfah et al., 2020; Harvie & Lee, 2002; Pasadilla, 2010). Moving the era from Industry 3.0 to Industry 4.0 has entered a new phase; the German government at the Hannover Fair event in 2011 also inaugurated this term. The term results from the war of innovation, business strategy, and the war of smarts to prove who deserves to be the market leader. The winning side will be the defending champion, while the losing side will only have memories. Nokia, Kodak, Fujifilm, Siemens, Motorola, and IBM are a few examples of giants who fell from the battlefield. BMW, MercedesBenz, Toyota, Honda, Mitsubishi, and Yamaha are the new prima donna arrivals as future conquerors; Space-X and Tesla are engaged in the automotive sector. • On the other hand, Microsoft and Apple still prove they deserve to lead the mar­ ket, although the presence of Google and Facebook became a frightening specter as a rising-star company of the future. In the transition period from Industry 3.0

Transformation Customers Needs in the Aspect of Client Value 89 to Industry 4.0, we can all conclude that telecommunications, digitalization, and computerization companies are the ones who carved out the monumental history of human civilization today. Furthermore, in the industrial era 4.0, the development of the Internet of Things (IoT), big data, artificial intelligence, and robotics are characteristics that even in the future will still dominate (I predict it for the next 100–150 years until finally, we are back at war to win the return to food as a means of survival). Maybe my statement needs to be studied more profoundly. Still, seeing the trends that have occurred since the beginning of hu­ man civilization on earth, it can repeat itself like fashion mode but after losing its momentum (critical mess). 5.4

Transformation: Shifting, Disruption, and Change

Everything is changing! I do not know who said it first, but what is certain is that the word “Everything is change” is a wise answer to make people who are still stuck with old patterns a little calmer. Or even to awaken many parties who are still orthodox-minded and are still lulled by the hegemony of the past. The way to deal with change is to change too. What can we use as lesson learning from the previous explanation that has dis­ cussed various series of industrial revolutions? • That change will happen; if you look closely again, the changing trend occurs at least once every 100 years in one period of human life. We assume that the dominant long-lived human reaches the age of 70 years. • The form of change that occurs from each displacement of the industrial revolu­ tion is generally caused by a series of events (e.g., disease, war, competition, and increasing human growth). The constant evolution of many people will lead us to think skeptically, looking for gaps and ways to meet these needs. • Adaptation to change is the primary key to staying afloat. In addition to the ability to adapt, the ability to innovate and do something that can be claimed as a Big-Thing is an extra ability that is a significant concern to survive and be sustainable. Today, we can claim that the driving force for change is technology. However, it is the answer that many parties generally give. I will explain why I say that such accusations are speculative, only abstract, and general charges. The extinction of Eastman-Kodak and Nokia is often used as a concrete example of an old giant com­ pany that has lost its prestige. Practitioners, scholars, and even sophomores have the same answer. The collapse of their business empires (Nokia and Eastern-Kodak) was due to their failure to seize opportunities and their inability to innovate with com­ petitors. The answer is not entirely wrong until one day, Nokia CEO Stephen Elop told the world, “We Didn’t Do Anything Wrong, But Somehow, We Lost.” All the views of scholars, innovators, and practitioners began to wonder. Then what caused them to disappear, like a sunken cruise ship in the middle of the rolling waves.

90 Aditya Halim Perdana Kusuma Putra What happened to Nokia, Eastern-Kodak, Motorola, Siemens, Erickson, and even BlackBerry, which recently enjoyed victory after the collapse of Nokia, due to changes or changing patterns? Shifting is a wise answer to answer it all. An in­ teresting question that arises is: what is shifting? • • • • •

Demographic and psychographic shifting Consumer saturation of established brands Consumer preferences change New generation that means new idol, new brand reference The new power of complementary product

Reporting from the United Nations states that the world’s population is expected to increase by two billion people, from the original 7.7 billion to 9.7 billion people in 2050. It added that half of the global population growth between 2022 and 2050 is expected to come from only nine countries (India, Nigeria, Pakistan, Congo, Eutopia, Tanzania, Egypt, Indonesia, and sub-Saharan Africa). America expects to experience a population decline. Then, the message is that the shifting demographic cycle, namely demographic shifting, means the movement of new economic poles. Today, we can witness the dominance of China as a new economic power in Asia. South Korea is the supplier of smartphone-screen technology to the technology company Apple-US. Japan is still surviving with several brands that have become top-of-mind worldwide, such as Toyota, Honda, and Yamaha. We-Chat, Alibaba, and Alipay are Chinese-owned e-commerce platforms that have grown exponentially even in their own countries. And Indonesia, which has also begun to clean up, prepares itself to grow exponen­ tially to welcome the new era. 5.5

Harmonization Between Competition and Collaboration

Opponents can become friends, too; this is the best strategy when dealing with competition. Competition is not merely defined as a form of mutual activity show­ ing who is the strongest. What has happened from Industry 1.0 to Industry 3.0 hints at a wise message that competition is not always synonymous with being hostile to each other or just taking an acquisition strategy? Industry 4.0 opens up space to compete more elegantly, namely through collaboration. The purpose of the alliance is to kill the potential for the growth of new competitors that continue to exist all the time. As I have said before, in the era of Industry 3.0, too many giant companies were busy fighting each other in the sky, without realizing the rubble of their fight turned out to be an opening for newcomers who, in their initial position, were still crawling on the ground, then grew to replace the places of the old giants today (e.g., Amazon, Google, Facebook, Alibaba, Hyundai, Asus ROG, Xiaomi, and Tesla). Apple and IBM have carried out the diffusion of competition–collaboration. Although the relationship is like a Tom & Jerry couple, who are sometimes hostile, other times they are like-minded. It is said that the story of the feud between Apple and IBM began more than 30 years ago. Still, surprisingly these two companies

Transformation Customers Needs in the Aspect of Client Value 91 with different styles and cultures decided to form a coalition even though their collaboration journey was full of drama and romance. At that time, Apple grew as a computer company targeting the personal consumer market share, while IBM focused on the corporate market and well-known large campuses. But IBM, which was founded 65 years before Apple, felt that Apple’s exponential growth in the market could threaten IBM’s stability. Finally, IBM launched the IBM-PC product line in 1981, using Intel’s microprocessor with a system provided by Microsoft. Feeling that IBM was infiltrating its gaming area, Apple issued an ad that greeted and flicked IBM, “Welcome to IBM.” In the end, IBM and Apple decided to form a coalition and establish strategic cooperation because Microsoft launched the Win­ dows operating system. On the other hand, the massiveness of Win-Tel products in the market due to Microsoft’s licensed Windows operating system was also sold to companies other than IBM, which turned out to be spectacular; Win-Tel grows even today with Compaq, Hewlett Packard, who started the effort. What happened to the competi­ tion between Apple and IBM in the past, or even between Apple and Samsung some time ago, finally provides a valuable lesson. Whenever there is a dispute, parties are working secretly to have the opportunity to grow exponentially. At least the statement about the fall and the feud used as the momentum to increase for new competitors is in line with what has been conveyed by Christensen (2013) in his book “The innovator’s dilemma: when new technologies cause great firms to fail.” 5.6

From Size to Value, From Solo to Co-Creation

It seems a series of valuable messages from the past, in response to changes in competitive sustainability, were taken seriously by many companies/organizations. In the beginning, the focus and attention of many organizations were on how to cre­ ate a size that turned out to be false and then changed to thinking about the meaning of value more wisely. The examples of giant companies that have fallen into disre­ pair provide a valuable lesson that “Invisible Hand” is accurate (Armstrong et al., 2014; Lestari et al., 2020; Azizah et al., 2022). The Roadmap for Industry 4.0 is not only about the fulfillment of wireless ac­ cess, especially in terms of communication, but also about the massive Internet of Things and Networks. More than that, increasing value is the main thing to stay competitive and sustainable (Hasrat & Rosyadah, 2021; Marpaung et al., 2021). The Industrial 4.0 era is identical to the reduced use of human power as an actor driving production. Humans will be accompanied by robots or even robots that will dominate activities that humans did initially (Widarko & Anwarodin, 2022). We have seen that it does not take long for the action of shooting a film from helicopters to be replaced by drones. Storefronts for products sold at the mall are now moving to e-commerce application services (Widi et al., 2021; Simanjuntak & Putra, 2021; Pradana et al., 2022). The presence of new idols, which then went viral to replace the position of artists who have long existed, Gangnam Style, for exam­ ple, Justin Bieber, who became an idol for young people who started with YouTube videos, completely changed people’s behavior from watching TV and then

92 Aditya Halim Perdana Kusuma Putra moving to YouTube. Well-known brands are currently building their official stores in cyberspace and closing most conventional outlets in malls. Even in Indonesia, several state-owned banks have decided to impose a moratorium on their business branches and even reduce the number of employees. Bank tellers and front-liners of banks and hotels were then turned into applications on smartphones and bustling cash-deposit ATMs at supermarkets (Azizah & Nur, 2022; Kartini et al., 2021; S. Sugiarto & Octaviana, 2021). Co-creation is the best way and solution to respond to community needs quickly, maintain business activities so that they continue to run well, and reduce the impact of risks resulting from the Solo game pattern in doing business. 5.7

Changing Customer Needs: Opportunities and Challenges

Review what has been discussed in the Transformation section: Shifting, Disrup­ tion, and Change. Demographic and psychographic shifts are fundamental factors in why adaptation to a series of changes is necessary. Kartajaya et al. (2016) then again surprised us with their work on Marketing 4.0, hinting that what happened in the era of Marketing 1.0–3.0 according to the Industrial Revolution 1.0–3.0 has changed so rapidly. Social media now eliminates geographical boundaries; consumer preferences change very quickly also due to social media, consumer decision-making changes very quickly, consumer reference groups that have initially been only limited to family, friends, and social environment, then increased with the presence of YouTube, TikTok, Instagram, WhatsApp, and Telegram filled with content creators of un-boxing products and product reviews. Everyone can feel safe deciding to shop or not to shop from videos about product reviews on YouTube or even because of the star rating given due to bad testimonials by consumers in the comments–testimonials column in e-commerce applications (Indahingwati et al., 2019). In Indonesia, Uber, Grab, and Gojek replace how Indonesians carry out daily transportation; it is more convenient, cheaper, safer, more reliable, and more private (Razak et al., 2019; Farida & Ardiansyah, 2022). If you visit Indonesia, one of the digital applications in the logistics and trans­ portation sector, “Gojek” and “Grab,” which are owned and operated in Indonesia, can be used as an example of a company with a super-sensational breakthrough that was never imagined before. What has Gojek done to meet customer expectations, and the Indonesian people numbered 273.5 million (data for 2020)? • Gojek and Grab implemented a never-stop service vision and mission, which later became their business model and canvas. It can be concluded that all daily affairs for the Indonesian people are represented by their application. When you need transportation to your destination, they provide Go-Car facilities for cus­ tomers to choose a car transportation mode like a conventional taxi. Still, if you want to get to your destination faster with less luggage, you can select a Go-Bike, which costs more. It is inexpensive; sit and then be escorted to your destination. Another service is when you decide to shop for something but do not have time to visit supermarkets, malls, or anything else, Go-Mart and Grab-Mart facilities;

Transformation Customers Needs in the Aspect of Client Value 93 you stay at home and wait for your order to arrive at the door. Then, if you feel the distance is too far to send packages to your colleagues, Go-Send service facilities will pick up your order at their destination. You are tired and tired all day working; Gojek also comes with Go-Massage facilities that will visit your home. GoJek comes with a Go-Box facility to transport all items from your old house to your new place, all by relying on the system from Google Maps. • They were breaking the limits. GoJek and Grab then penetrated the barrier that had long been built up in the social fabric of Indonesian society so far. For exam­ ple, in payment facilities, when you use the GoJek and Grab applications, there are Financial Technology (Fintech)-based payment facilities, namely OVO-Pay and Go-Pay. Like China’s We-Pay, OVO and Go-Pay are growing exponentially through the boundaries of overcoming payment problems for the Indonesian people. OVO and Go-Pay are not just payment facilities that only apply to the GoJek and Grab applications. Almost all business scales, including SME, OVO, and Go-Pay, can be used as valid QR-Code-based payment tools. It is still taboo for most Indonesians to deal with credit cards; OVO and Go-Pay can solve this problem by crediting a product (PayLater) with a reasonably low rate and the risk of not being subject to annual fees such as credit cards. The breakthrough of OVO and Go-Pay as a means of payment does not only occur when you transact at conventional merchants. Your smartphone that uses the Android and iOS op­ erating systems includes Go-Pay and OVO as a means of payment to subscribe to applications, buy music, buy books, online game vouchers, and buy games on Steam and Epic with just one tap on your smartphone screen to cut deposits from their application. The breakthrough of GoJek and Grab, which have been operating in Indonesia since 2010, then changed the perspective of Bank Indonesia as a central bank, which then welcomed the innovations made by Gojek, and Grab, which also launched a QR-Code-based application in terms of payments. Technology-based funds called “Dana” and “QRIS” aim not to compete with Go-Pay and OVO Pay. Still, the ac­ tions taken by the state are to anticipate the dominance of the private sector alone and various other concerns in terms of the financial needs of the Indonesian people. Developments and series of changes also continue to occur in activities in the virtual world, especially in terms of entertainment. No one ever thought that by just playing games, then turning into a profession makes money. As a digital company engaged in the entertainment sector owned by China, Tencent proved this to the world. They presented World League Games and Competitions in playing games and then made gaming activities only “Wasting-Time” and became a new sport known as e-Sports. Then, anyone can become the center of attention on a par with the artists on television. They are TikTokers, Celebgrams, and YouTubers, new idols who have their fan base on the virtual world platform (Indahingwati et al., 2019). The emergence of new professions born from digital activities is becoming a rising star and is collaborating in terms of marketing, product, and service affili­ ation with well-known brands. In the study by Mansur et al. (2019), Ridha et al. (2018), Kapitan and Silvera (2016) express a positive and significant opinion. The

94 Aditya Halim Perdana Kusuma Putra form of marketing played by people who are not public figures, published in nontelevision media like commercial breaks, and widely reviewed by content creators gives the impression of being honest, independent, and free of intervention. 5.8

Post-COVID-19 Legacy

We all feel that what has befallen the world with the COVID-19 pandemic, which has entered its third year since 2020, has dealt a severe blow to everyone and all sectors. Initially, the impact is on health, then later on the effect on the economy, society, and behavior. However, what happened proves to all of us worldwide that adaptation is the only way to survive. Once again, COVID-19 has finally opened our eyes to the fact that technology is a tool that can answer these problems. The term “social distancing” is a term born to reduce the impact of the spread of COVID; everything was then rearranged according to current needs. Working from home is a solution to keep producing and doing activities. During these 3 years, what previously did not make sense to all of us has finally made sense. For clarity, at the beginning of the pandemic, we were pessimistic that the learning process in schools and universities, whose pattern was learning in the classroom, and making physical contact, then the presence of technology from the Zoom Application, Google Classroom, and Google Hangout instantly knocked down learning patterns and transfer of knowledge that had occurred for hundreds of years ago. Changes in conventional learning and work methods (offline face-to-face) then change to interacting with each other using a webcam and internet connection. What happened during the COVID-19 period further emphasized privacy is­ sues; the definition of service excellence, service innovation, and customization became clearer. Although some conventional services that require physical contact with large masses of mobility stop immediately (e.g., aviation, ship, and train ser­ vices), a sharp increase occurred in companies engaged in FCMG (for example, the high demand for frozen food products during the pandemic due to restrictions on social activities outside the home), healthcare, online shopping activities, internet–telecommunication service providers, and logistics companies as part of the distribution supply chain of e-commerce. The community’s needs also increase; the demand for health facilities and medi­ cines, which are needed privately, also occurs. For example, Halo-Doc in Indone­ sia, an application for providing 24-hour health consulting services via websites and smartphone applications, helps create a supply–demand supply chain in tel­ ehealth (Napitupulu et al., 2021). Not only in terms of health but working from home also provides opportunities for many businesses to change the work strategy of their workers, not only by working at home but Work-Hub and Work-Space with a café concept can be an alternative for business people to try to provide this facility. Even Facebook is aware of this by trying to convince the world to cre­ ate an artificial planet called the “Metaverse.” In short, consumers today want the “door-to-door service.”

Transformation Customers Needs in the Aspect of Client Value 95 The expansive space to create creativity in cyberspace is becoming more and more unlimited. Everyone is free to express themselves and their hobbies and work on the YouTube channel. For example, the presence of Ronald Reagan’s Co-Anchor ultimate fighting championship (UFC) podcast in America, whose content was ini­ tially intended only to exchange ideas with UFC fighters, has become a universal channel for discussion among artists, as well as politicians and world leaders. And The Close The Door Podcast belongs to a former magician, artist, and TV presenter in Indonesia, Deddy Corbuzier, who is also trending globally and contains discus­ sions on everything that happens in Indonesian society, a place to get information that mainstream media has never presented. It is filled with artists, business people, comedians, ministers, and state officials in Indonesia. The presence of the Reels facility on Instagram then tries to balance the domi­ nance of TikTok, whose use is not only as an arena for self-existence but is used as a means of advertising goods and services by many brands. Smart Stuff products such as Alexa by Amazon, Google Home by Google, Smart Bulb by Philips, Bardi, Smart Refrigerator, and Smart Washing Machine by LG and Samsung are also examples of customization-based innovations that rely on voice input to activate commands. More profoundly, the discussion about customers’ needs in Industry 4.0, several forms of product and service innovation that finally succeeded and felt more ac­ cessible, the challenges and critical gaps behind all of that did not mean that they did not exist. Of course, cybercrime activity can increase. Therefore, attention to cybersecurity must also be optimized for the digital-based service provider indus­ try. Concerns about data breach, Hoax, and Hate speech can also be a significant concern, so this should be the primary concern of all parties, especially for regula­ tors and policymakers, to try hard to adjust policies on changes in people’s lives behavior. Now even decades to come, we may be able to realize the opportunity to create increased productivity and economic value in line with the world’s SDG agreement. However, along with options, ethical issues and norms also experience a shift in definitions, dimensions, and philosophy. Therefore, ethics is a concern for all of us to be studied more deeply to welcome Industry 5.0 in the future. 5.9

Conclusion

Nothing lasts forever; the only thing that lasts forever is change; maybe that is the correct sentence to start the conclusion of this chapter. The hope is, of course, that we can all be optimistic, keep learning, and strive toward a mature, mature, and well-established phase from a conceptual and fundamental perspective in all areas (i.e., industry, business, behavioral, economic, and social). The way to respond to change is to adapt to the change itself prepare what strategic steps will be taken to adjust to the following modification. Everything we have discussed in this chapter does not rule out the possibility of forming a new series of questions and fresh material for reflection that will continue in various discussion rooms in the future. However, reflecting on the trends of the time and what happened during the period of change and industrial revolution in modern human civilization as described in

96 Aditya Halim Perdana Kusuma Putra this chapter leads us to conclude that there is no genuinely standard and absolute strategy in business. To create value for customers and to create lasting effects in the industry, continuous learning and improvement process, a series of research and development, collaboration, alertness to quickly anticipate various challenges, reflex action to welcome opportunities, and building the broadest possible network are effective ways now and in the future to create value chain between business, customers, and social. Besides that, of course, attention to risk-management strat­ egy and ethics is also an essential factor to be observed to realize the essence of effectiveness and efficiency, which is also constantly changing. 5.10

References

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Transformation Customers Needs in the Aspect of Client Value 97 Harvie, C., & Lee, B.-C. (2002). Globalisation and SMEs in east Asia (Vol. 1). Edward Elgar Publishing. Hasrat, T., & Rosyadah, K. (2021). Usability factors as antecedent and consequence on busi­ ness strategy and SERVQUAL: Nielsen & Mack approach. Golden Ratio of Marketing and Applied Psychology of Business, 1(2), 81–92. Indahingwati, A., Launtu, A., Tamsah, H., Firman, A., Putra, A. H. P. K., & Aswari, A. (2019). How digital technology driven millennial consumer behaviour in Indonesia. Jour­ nal of Distribution Science, 17(8), 25–34. Kapitan, S., & Silvera, D. H. (2016). From digital media influencers to celebrity endorsers: attributions drive endorser effectiveness. Marketing Letters, 27(3), 553–567. Kartini, K., Fitri, F., Rabiyah, U., & Anggraeni, D. (2021). Analysis of the financial literacy behavior model. Golden Ratio of Finance Management, 1(2), 114–122. Kartajaya, H., Kotler, P., & Setiawan, I. (2016). Marketing 4.0: Moving from traditional to digital. John Wiley & Sons. Lestari, S. D., Leon, F. M., Widyastuti, S., Brabo, N. A., & Putra, A. H. P. K. (2020). Anteced­ ents and consequences of innovation and business strategy on performance and competitive advantage of SMEs. The Journal of Asian Finance, Economics and Business, 7(6), 365–378. Levy, H., & Hanoch, G. (1970). Relative effectiveness of efficiency criteria for portfolio selection. Journal of Financial and Quantitative Analysis, 5(1), 63–76. Mansur, D. M., Sule, E. T., Kartini, D., Oesman, Y. M., Putra, A. H. P. K., & Chamidah, N. (2019). Moderating of the role of technology theory to the existence of consumer behav­ ior on e-commerce. Journal of Distribution Science, 17(7), 15–25. Marpaung, F. K., Dewi, R. S., Grace, E., Sudirman, A., & Sugiat, M. (2021). Behavioral stimulus for using bank Mestika mobile banking services: UTAUT2 Model perspective. Golden Ratio of Marketing and Applied Psychology of Business, 1(2), 61–72. Mishkin, F. S. (1983). A rational expectations approach to macroeconometrics. University of Chicago Press. Napitupulu, D., Yacub, R., & Putra, A. (2021). Factor influencing of telehealth acceptance during COVID-19 outbreak: Extending UTAUT model. International Journal of Intel­ ligent Engineering and Systems, 14(3), 267–281. Pasadilla, G. O. (2010). Financial Crisis, Trade Finance, and SMEs: Case of Central Asia. ADBI Working Paper 187. Asian Development Bank Institute, Tokyo. Available: http:// www.adbi.org/working-paper/2010/01/25/3440.financial.crisis.trade.smes.central.asia/ ADBI Working Paper 187 Porter, M. E. (1989). From competitive advantage to corporate strategy. In Readings in stra­ tegic management (pp. 234–255). Springer. Pradana, A. F. P., Hasan, S., Putra, A. H. P. K., & Kalla, R. (2022). Moderating of SERV­ QUAL on E-WOM, product quality, and brand image on and E-commerce purchase inten­ tion. Golden Ratio of Mapping Idea and Literature Format, 2(1), 36–51. Razak, M., Gunawan, B. I., Fitriany, F., Ashoer, M., Hidayat, M., & Halim, P. K. P. A. (2019). Moving from traditional to Society 5.0 case study by online transportation busi­ ness. Journal of Distribution Science, 17(9), 93–102. Ridha, A., Perdana, A. H., & As’ ad, A. (2018). Celebrity Endorser Pada Jejaring Sosialinsta­ gram Untuk Menarik Minat Pembelian Calon Konsumen. Journal of Economic Resource, 1(1), 86–96. Rosak-Szyrocka, J. (2016). Automotive standard ISO/TS 16949 as a quality determinant. Production Engineering Archives, 10. Rosak-Szyrocka, J. (2017). Human resources management in Kaizen aspect. Human Re­ sources Management & Ergonomics, 11(1).

98 Aditya Halim Perdana Kusuma Putra Sheffrin, S. M. (1984). A rational expectations approach to macroeconomics: Testing policy ineffectiveness and efficient-market models by Frederic S. Mishkin. Journal of Economic Literature, 22(1), 126–128. http://www.jstor.org/stable/2725254 Simanjuntak, M., & Putra, A. H. P. K. (2021). Theoretical implications of theory planned behavior on purchasing decisions: A bibliometric review. Golden Ratio of Mapping Idea and Literature Format, 1(2), 1–7. Smith, A. (1937). The wealth of nations [1776], The Modern Library. Random House, inc. South, S. E. (1981). Competitive advantage: The cornerstone of strategic thinking. Journal of Business Strategy, 1(4), 15–25. https://doi.org/10.1108/eb038908 Sugiarto, S., & Octaviana, V. (2021). Service Quality (SERVQUAL) dimensions on cus­ tomer satisfaction: Empirical evidence from bank study. Golden Ratio of Marketing and Applied Psychology of Business, 1(2), 93–106. Sugiarto, U. S. (2021). Pengantar Hukum Indonesia. Sinar Grafika. Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic man­ agement. Strategic Management Journal, 18, 509–533. https://doi.org/10.1002/ (SICI)1097-0266(199708)18:7 < 509::AID-SMJ882 > 3.0.CO;2-Z Widarko, A., & Anwarodin, M. K. (2022). Work motivation and organizational culture on work performance: Organizational citizenship behavior (OCB) as mediating variable. Golden Ratio of Human Resource Management, 2(2), 123–138. Widi, F., Qahar, A., & Aswari, A. (2021). Legal protection against personal data in online loan transactions. Golden Ratio of Law and Social Policy Review, 1(1), 17–25.

6

Industry 4.0 on the Way to Companies’ Performance Naveed R. Khan, Muhammad Rahies Khan, and Arsalan Mujahid Ghouri

6.1

Introduction

Traditionally, companies gain their competitive advantage through cost leader­ ship, differentiation, and focus strategies (Michael, 1985). In the recent era, the principal driver of competition is technological change. Technological change not only alters the industrial structure but also creates and encourages new industries. Therefore, to handle the technological change and chase it as a competitive and value-added strategy, companies need deep knowledge, skills, capabilities, and understanding of new and emerging technologies. Despite the importance and need for these technologies, there exists misconception and misunderstand­ ing regarding these new and emerging technological innovations and inventions. Further, the nexus between these technologies and the competitive and improved performance of companies is still ambiguous and underestimated. More impor­ tantly, the technological revolution and its acceptance, adoption, and treating it as a competitive weapon is highly recognized in higher technologically oriented countries, whereas there are several hidden and potential threats, barriers, and steps among the developing and emerging economies (e.g., Akhtar et al., 2022; Ghouri et al., 2022). As mentioned previously, companies using the Industrial 4.0 revolution as a competitive tool for their sustainable performance globally, however, there exists a gap in the literature about how these companies perceive Industry 4.0 and whether they are capable of incorporating these technologies for their sustainable performance. Additionally, technological change is important because it alters the structure of companies and affects their operations to a certain extent. Literature has sug­ gested that not all technologies are beneficial and are suitable for all companies to get a competitive advantage. Most of the companies operating in a higher technological environment have recorded a worsening performance; however, some of the companies working in low technology zones have reported higher and competitive change. This is because the adoption of technology depends on the company’s structure and internal adoption environment. Despite these pros and cons, to get a competitive advantage, and sustainable performance, compa­ nies are motivated, attracted, and compelled by certain factors to incorporate

DOI: 10.4324/9781003404682-6

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Naveed R. Khan, Muhammad Rahies Khan, and Arsalan Mujahid Ghouri

and implement these technologies. Previous literature indicated that Industry 4.0 technologies, especially blockchain and artificial intelligence, have a strong and positive impact on corporate governance (Grove et al., 2018; Zhu, 2019; Ivan­ inskiy & Ivashkovskaya, 2022). Further, the Industry 4.0 revolution has brought a bunch of technologies and got more attention recently after the outbreak of the COVID-19 disruption. These technologies include but are not limited to blockchain technology, artificial intelligence, the internet of things (IoT), radio frequency identification system, robotics, machine learning, big data predictive analytics, and drone technology. This chapter has focused on the types of Industry 4.0 technologies, the ben­ efits of these technological adoptions, and the barriers and drivers in implementing these technologies. Majorly this chapter has discussed how these technological innovations and inventions help firms globally to gain competitive and sustainable performance. Before moving further, this chapter is interesting to address and dis­ cuss the following main headings. • • • • • •

Industry 4.0 technologies and its basics concepts Benefits of Industry 4.0 technologies Drivers of Industry 4.0 adoption Barriers to implementing these Industry 4.0 technologies Role of Industry 4.0 technologies in achieving sustainable performance Conclusion

6.2

Industry 4.0 and Its Basic Concepts and Applications

Rapid dynamism has changed the way of competition among business concerns. Traditional methods and strategies of competition have been transformed into new emerging technology strategies and methods. Technological innovation and its implementation due to competition, disruptions, and other orientations have provided the companies to think in different ways, and this technological orientation has provided companies with several advantages. Therefore, “the incorporation of new and emerging technologies like blockchain technologies, artificial intelligence, internet of things, machine learning, robotics, etc., into business operations to gain sustainable and competitive advantage and perfor­ mance is called the Industry 4.0 revolutions” (e.g., Ghouri et al., 2019, 2021). The industrial 4.0 revolution has gained immense attention and importance in recent times (Kin et al., 2020). Incorporation and implementation of computer­ ized systems in business activities through smart systems and technologies have replaced human interference and hence promote business performance (e.g., Ameer & Khan, 2022). Further details, definitions, and concepts of these emerging technologies are introduced in the following sections. These Industry 4.0 technologies included as follows:

Industry 4.0 on the Way to Companies’ Performance

101

Information System Technology Planning and Budgeting

Form Infrastructure

Technology Office Technology

Margin

Training Technology

Human resource Management

motivation Research Information Systems Technology Product Technology Computer Aided Design Pilet Plan Technology

Technology Development

Software Development Tools Information Systems

Information System Technology Communication System Technology

Procurement

Transportation System Technology Transportation Technology

Basic Process Technology Materials Technology

Materials Handing Technology

Machine Tools Technology

Storage and Preservation Technology

Material Handling

Communication System Technology Testing Technology Information System

Technology Maintenance Methods Testing Technology

Transporation Technology Materials Handing Technology Packing Technology Communication System Technology Information System Technology

Media Technology Audio and Video Technology Communication System Technology Information System Technology

Diagnostic and Testing Technology Communication System Technology Information System Technology

Margin

Building design Operation Technology Information System Technology

Inbound Logistics

Operations

Outbound Logistics

Marketing and Sales

Service

Figure 6.1 Representative technologies in a firm value chain Source: Michael E Porter (1998)

6.2.1

Big Data Analytics

Big data refers to the large, complex, and diverse datasets that are available in raw form with firms and used to analyze, interpret, and implement competitive and valueadded business strategies to optimize business decision-making and achieve com­ petitive and sustainable performance. Hence, it is evident from the literature that the implementation and adoption of decisions based on big data analytics brought en­ hanced technological capabilities and promote sustainable performance by enhanc­ ing innovation, productivity, and competitiveness among firms (Mikalef et al., 2019; Khan et al., 2022; Sun et al., 2022). Further, organizational decision-making is made based on big data analytics by monitoring, evaluating, and managing organizational problems in better and more advanced mechanisms. At the organizational level, big data analytics might be treated at three major levels: data as a tool (dealing with firms existing issues with traditional capabilities), data as an industry (formation of new ventures and new computerized systems to handle new technologies), and data as a strategy (formation of new business models through the technology). Dealing with big data is a challenging job for industries worldwide because data produced through machines, cloud technologies, and business operations have increased by approxi­ mately 1,000 exabytes per year. Considering this discussion vital, big data analytics has taken a deep-rooted role in the Industrial 4.0 revolution (Yin & Kaynak, 2015). 6.2.2

Blockchain Technology

The origin of blockchain was initially started with the concept of “cryptocurrency” in 1991. Since then the blockchain was considered to be the most primitive Industry

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Naveed R. Khan, Muhammad Rahies Khan, and Arsalan Mujahid Ghouri

4.0 technology in business operations. Treiblmaier (2018) defined blockchain as the digital, decentralized, and distributed ledger to record the business transactions in chronological order to create a permanent and tamper-proof transactions record. Three types of blockchains are widely used in the business community and these are public, private, and hybrid blockchains. Blockchain technology has widely been implemented by firms worldwide to actualize competitive and sustainable business performance (Marbouh et al., 2020; Nandi et al., 2021; Treiblmaier, 2018; Wang et al., 2019). 6.2.3

Autonomous Robots

The use of man-made machines to carry out the daily manufacturing activities and other heavy technical work that might not be efficiently performed by the human resource is called “robotics.” To carry out the just-in-time inventory and JIT manu­ facturing activities, the inclusion of robotics is as important as other autonomous systems. Therefore, to enhance the organizational output, performance, and effi­ ciency, the incorporation of robotics made task performance easier and more opti­ mized. In the operationalization of robotics, the role of human–machine interaction is quite important because of the control and command mechanism. Therefore, the role of close collaboration between these two is crucial and for the organizations, the adoption of robotics technology is cumbersome along with its benefits (Hede­ lind & Jackson, 2011). The implementation of robotics in manufacturing industries is widely rec­ ognized in previous literature, and it enhances organizational sustainability and competitive performance (Tankova & da Silva, 2020; Xiao et al., 2020); however, the use of robotics in services industries has been recently recognized in the recent era after the outbreak of COVID-19 (Javaid et al., 2020; Sarker et al., 2021). The implementation of robotics has proved, enhanced, and opti­ mized business performance in all industries. Similarly, robotics has also been implemented in other industries like production, logistics, and distribution and is merely controlled by human interaction. The majority of the famous and multinational companies like Pepsi Co, automotive companies, and electronic industries have incorporated robotic technology and achieved sustainable and competitive performance. 6.2.4

Simulation

Simulation is the use of computerized programs that express and represent the dynamism of actual system behavior and outlook. The simulation uses models and mathematical descriptions instead of a real system which is the same as a real system. The use of simulation tools and instruments played a supportive role in manufacturing, production, and distribution activities which help in achieving sus­ tainable and competitive performance. In today’s dynamic and fragile business en­ vironment, the use of simulation provides adjustment against complex systems by planning the business operations by providing real-time knowledge and information

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regarding the actual system through engineering capabilities (Weyer et al., 2016). Therefore, based on simulation models and mathematical descriptions, competitive business strategy and tactical approach can be done through real-time information and knowledge hence providing optimized, competitive, and sustainable business operations (Uhlemann et al., 2017; Khan et al., 2021). 6.2.5

The Industrial Internet of Things (IoT)

Connecting physical objects called “things” with the internet for the purpose of exchanging information and data is called the internet of things. Things or ob­ jects are based on the nature of the business or application involved. For exam­ ple, sensors are used to monitor temperature and moisture within a building or in a container. Similarly, radio frequencies are used to locate physical objects and shipments (Sarkis & Dou, 2017). Through this data collection, systems run their analysis and are further refined by human interaction to make real-time business operations (Rahman & Rahmani, 2018). Through this real-time decision-making, origination achieves competitive and sustainable performance, especially in supply chains and inventory management. Presently, the internet of things played a vital role in the manufacturing, production, and distribution of materials especially dur­ ing the period of COVID-19 pandemic. 6.2.6

Cloud Computing

Cloud computing is internet-based computing in which shared information and sources are available and handed over to computers and other technology devices for storage and analysis. Cloud computing has numerous benefits to the informa­ tion and communication technologies which are helpful to supply chains to go for automation by providing the integration and facilitation to the management. Cloud computing includes the information technology resources which are used to store and process the data in a virtual network and serve many clients simultaneously. Cloud computing consists of three models: software as a service (SaaS) in which the access to the system depends on the purchasing of the system like ERP, second is Platform as a server (PaaS) in this type the clients are allowed to access the ap­ plication like software developers, and third is Infrastructure as a Server (IaaS) that provides the clients the fundamental programming like storing the data, etc.; one of the major examples of cloud computing is Google Drive that provided limited access and storage of the client data. Companies in today’s era majorly depend on the data and use it to analyze the data to forecast and actualize the future demands of their products. Traditionally, cloud computing is used by firms to store data and to perform automation functions in their organizations like ERP systems, etc. (Garrison et al., 2015; Khayer et al., 2020); however, cloud computing has been recently highly recognized during the outbreak of the COVID-19 pandemic and serve the enterprises to gain survival, competitive, and sustainable performance (Narayanamurthy & Tortorella, 2021; Prihatiningtias & Wardhani, 2021).

104 6.2.7

Naveed R. Khan, Muhammad Rahies Khan, and Arsalan Mujahid Ghouri Additive Manufacturing

Three-dimensional (3D) technology used to customize the goods and products for customers comes under additive manufacturing. The common types include 3D and prototype printing which are used to produce small quantities to have the required stock in their inventory. It is the quality of additive manufacturing that lightweight but long-lasting material can be used to manufacture the products. In this regard, aerospace firms implement these technologies to construct aircraft and their parts through titanium to avoid weight (Rüßmann et al., 2015). Further, well-known multinationals like Google, Motorola, and Apple accelerate their smartphone ap­ plications and their speed through additive manufacturing. Additive manufactur­ ing has provided companies advantages of reduced lead time, mass customization, agility, and increased volume production (Conner et al., 2014). Traditionally, additive manufacturing has played a critical but less capable role in firms’ sustainable performance due to lower penetration and adoption. These tech­ nologies are used to manufacture parts from 3D models, and this process is done in several layer-by-layer stages which reduces the raw material consumption. Fur­ ther, these technologies make the companies capable of enabling the JIT function in their production by promoting speed, adaptability, and versatility (Frazier, 2014; Haq et al., 2016). However, the actual strength and application of these technolo­ gies were implemented during the COVID-19 pandemic outbreak. The majority of the companies survive and gain competitive and sustainable performance due to the implementation of this technology (Khan & Manzoor, 2021; Larrañeta et al., 2020). 6.2.8

Augmented Reality

It is an emerging technology that creates harmony and interaction between the vir­ tual world and its surroundings. With this technology, Google has created the Google glasses which are also known as Magic Leap and converts the light angle and depths by adjusting the human eyes (He et al., 2017). The technological outbreak and its adoption have made things different for human beings to handle but this technology has provided them with interaction with the human and technology. Firms are using this technology in combination with computer systems, graphics, and physical ele­ ments. It is also used to control different tasks through sensor technology. 6.3

Industry 4.0 for Managerial Decision-Making

The managerial decisions define the future of companies, and these decisions are based on the dynamic internal and external organizational environment. Today’s working environment and market situations are different and more complicated compared to the previous business environment. Therefore, the managerial deci­ sion regarding the adoption of Industry 4.0 is a crucial segment in organizational philosophy. Traditional decision-making in the business sector was based on the adequate way or best way “the philosophies of Max Webber” but today’s dynamic, fragile, and complicated business needs more accurate, well-defined, and reliable

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Automation, optimize, and redesign business operations

Industry 4.0 technologies Improve communication between inter and intraorganization

Support business decisions

Figure 6.2 Author’s contribution

decisions to compete in the dynamic and fragile business environment. Therefore, Industry 4.0 played an adequate role in managerial decisions and provides more accurate, reliable, and automated systems and data to forecast future requirements and make future decisions. The decisions made based on Industry 4.0 technology information were considered more adequate to gain competitive and sustainable firm performance. The Industry 4.0 features are outlined in Figure 6.2. 6.4

Challenges of Industry 4.0 Adoption

Despite the advantages and benefits of Industry 4.0, literature has indicated numer­ ous challenges and barriers to its implementation. However, the challenges and barriers differ according to culture and economy. Followings are the major chal­ lenges identified and discussed in previous literature in various industries 6.4.1

Cost of Implementation

One of the basic requirements for any change is capital and resources. Therefore, the adoption of Industry 4.0 technologies brought capital change and exerts pres­ sure on the organizational resources. However, for the achievement of sustainable performance and competitive advantage, change adoption is a crucial element but it is on one hand a cumbersome issue for the companies due to ambiguous benefits. Literature has indicated that the adoption of new technological changes primarily brings a cost burden on the firm’s operations (Alaloul et al., 2020). Alongside ini­ tial setup costs, hidden and associated costs like workforce training, infrastructure costs, and maintenance costs are also the major implementation barriers in Indus­ try 4.0 technologies. More importantly, the long-term ambiguous return is also a potential challenge for its implementation. These hidden and ambiguous costs associated with direct and indirect adoption of Industry 4.0 technologies have been proven especially in the literature on the construction industry (Oesterreich and

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Teuteberg, 2016). Therefore, addressing these challenges is the most exponential and initial step to achieving a sustainable and competitive edge in a similar industry and likewise. 6.4.2

Resistance to Change

Organizational structure is an important factor in the response and adoption of change. Technological change is the most influential and critical change firms have to address. The majority of the organizations in developing and emerging econo­ mies are fragmented and conservative in their business operations and based on rigid or centralized organizational structures. This type of structure and business activities leads to a lack of interest and willingness among the management that cause resistance to the adoption of innovative and emerging technologies like In­ dustry 4.0 technologies. The adoption of any type of innovative technology and its successful implemen­ tation is truly based on the motivation and commitment of the firm’s employees. Especially at the managerial level employees are true representatives of the or­ ganizational decisions. Therefore, to address the resistance barrier, the motivation, commitment, and training of the employees are very important. Previous litera­ ture has indicated that these barriers can be a potential threat to the adoption and implementation of technological change among organizations (Chan et al., 2019; Sarkis & Dou, 2017). 6.4.3

Lack of Labor Force

Companies gain a competitive advantage in their workforce. Geographical loca­ tion and availability of skilled, cheap, and trained workforce is a dire require­ ment of companies across the world. Further, the retained, loyal, and committed workforce is also required to gain competitive and sustainable performance for the firms. Literature indicated that companies are ambiguous about the capabilities of their workforce regarding the adoption of change especially technological change (Ghouri et al., 2021; Hewage et al., 2008). Their findings also suggested that a lack of skilled workforce leads to poor reduced firm performance. 6.4.4

Unclear Benefits and Gains

Most firms tend to achieve short-term benefits and primarily focus on these benefits; however, benefits from Industry 4.0 adoption are based on long-term conditions. The firms feel hesitation regarding the adoption and selection of Industry 4.0 due to unclear return and long-term benefits which are ambiguous and unclear. Further, the unclear and ambiguous benefits make the decisions of adopting these emerging technologies more difficult and hectic for the companies operating in developing and emerging economies. From this perspective, these and other companies need to deeply analyze and thoroughly evaluate the gains and losses by cost and benefit analysis regarding the adoption of Industry 4.0 technologies because the literature

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has indicated that not all technology adoption is favorable for every company. Fur­ ther, it is also evident that some highly mature and competitive firms sometimes failed to gain the desired gains from highly saturated and developed technologies in even the most developed culture (Michael, 1985). Hence, the decision to adopt and implement these technologies needs careful and experienced analysis. 6.4.5

Lack of Investment in Research and Development

Resource allocation in organizations for different activities is based on their goals and objectives. The majority of the firms remain in the transition phase because of this globalized and sophisticated business environment. Therefore, firms primarily focus on their core activities and mostly neglect the research and development ac­ tivities. The training, research, and development in the business sector are majorly considered cost burdens instead of benefits. Hence, the allocation of resources and funds is critical and minimum in those organizations, and it is especially observed in developing and emerging economies. The technological change and its adoption are purely based on firms’ attitudes toward research and development activities and funds allocation for these activities. This is a potential barrier to the imple­ mentation of Industry 4.0 technologies in organizations. Again, the companies are reluctant to allocate investment in research and development activities because of ambiguous and lower chances of research and development projects. 6.4.6

Lack of Standardization

The business sector always pursues those potentials and targets for which there exist standardized permissions and protocols. As discussed earlier, emerging tech­ nologies are unstandardized due to their emerging dimension; hence, organizations are hesitant to approach them without prescribed standards. 6.4.7

Data Protection and Cybersecurity

The majority of the Industry 4.0 technologies are based on data collection, analysis, and storage. The major threat associated with emerging technology is data protec­ tion and its security. As previously discussed, the companies are reluctant to allo­ cate funds for research and development to formulate and discover innovative and inventive business technologies but the data storage and its security again required an investment. Again, the fund’s allocation and protection of these data is a cum­ bersome task for the firms operating with minimum capital. 6.4.8

Legal and Contractual Issues

The business operations are protected and supported by legal and contractual agree­ ments. However, the outbreak of technological innovation, especially Industry 4.0, is recent and so far, there are no adequate and authenticated legal frameworks and contractual agreements, especially in the developing and emerging economies. This

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is another potential threat that causes hindrances in the adoption and implementa­ tion of Industry 4.0 technologies. For example, blockchain technology like the Bitcoin exchange has not been protected and permitted in the majority of the countries which causes hesitation and risk among business organizations and owners. 6.5

Drivers of Industry 4.0 Adoption

The chasing and adoption of any market change are mostly driven by some poten­ tial factors. Similarly, some of the major drivers of Industry 4.0 are discussed later and also described in Table 6.1 with the sources. 6.5.1

Changing Market Demands

Business operations have changed dramatically nowadays and especially after the globalization and outbreak of certain disruptions. To meet the market demands and accelerate the business operations to meet the customers’ demands, firms need to be more proactive and efficient. To cater to these factors firms need to adopt the dynamic technology market changes which are the dire need of time to accelerate the production and distribution process. Further, the uncertain and differentiated

Table 6.1 Drivers of Industry 4.0 adoption Driver

Category

Source

Legislative standards

Countries’ legal and regulatory frameworks and changes in legislation and regulations Differentiation and conscious strategies regarding Industry 4.0 implementation Customer orientation and requirements Reduction in cost

Malyshev (2008)

Strategies

Workforce Public adviser systems

Just-in-time inventory and lean manufacturing To cope with competitors as competitors have adopted Industry 4.0 technologies A qualified workforce can compel the firms to adopt Industry 4.0 technologies Adoption of Industry 4.0 technologies due to public pressure

Kane et al. (2015); Pagani (2013) Geissbauer et al. (2016) Colotla et al. (2018); Dujin et al. (2014); Moeuf et al. (2018) Lasi et al. (2014); Moeuf et al. (2018)

Geissbauer et al. (2016) Malyshev (2008)

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futuristic demands compel the firms to adopt the Industry 4.0 technologies to fore­ cast the futuristic demands more precisely and accurately. 6.5.2

Competition

Today’s business operations are more competitive as compared to traditional ones due to more easily available business information. Further, it is getting more and more difficult for business concerns to meet the differentiated customer require­ ment. The firms capable of fostering and chasing the technological market changes are more successful in fulfilling the customer’s requirements; however, others failed to do so. Therefore, it is a dire requirement of time for the survival of firms to adopt emerging market innovations and technologies like blockchain, artificial intelligence, and Internet of Things. 6.5.3

Uncertain Disruption Outbreak

History has revealed that the outbreak of disruption does not remain rare but its outbreak may be often. These disruptions include the outbreak of communicable diseases, natural disasters, and other man-made disasters. Recently, the outbreak of the COVID-19 pandemic has approximately changed the business operations of almost every business concern and also created a majority of new business models and business entities. All these business models and business concerns are majorly based on technological innovations, especially Industry 4.0 technologies. Indus­ try 4.0 technologies like blockchain, artificial intelligence, Internet of Things, ro­ botics, drone technology, and big data have helped firms to remain sustained and competitive in the market and also helped others to create new business entities. Therefore, these disruptions compel the firms to adopt emerging Industry 4.0 tech­ nologies to provide sustainable business performance. 6.5.4

Top-Level Management Motivation/Interest

Success and failure of the business decisions are majorly depending on the manage­ rial motivation and interest. Literature has indicated that managerial interest and mo­ tivation lead the firm’s performance to an optimized and competitive edge and their failure causes vice versa (Sarkis & Dou, 2017). The decision to adoption and im­ plementation of Industry 4.0 technologies is purely based on the employer, top- and mid-level managerial interests, and motivation. Therefore, managerial motivation and initiative act as an exponential driver in the adoption of Industry 4.0 technologies. 6.5.5

Resource Capabilities

Adopting a change is not an easy decision to be considered immediately; however, certain factors need to be analyzed and considered earlier. Among these, the firm’s resources played a major role, and these resources include the financial capabili­ ties, trained workforce, and organizational infrastructure. The successful chasing

110 Naveed R. Khan, Muhammad Rahies Khan, and Arsalan Mujahid Ghouri and adoption of any market change especially the technological change mainly depends on firms’ resources. Adoption of technological change not only required initial capital but also required training of the workforce and maintenance of the infrastructure. Therefore, the firm’s resource capabilities are essential drivers for the adoption of Industry 4.0 technologies. Some of the other drivers are covered in table one through their sources. These are additional but potential drivers in the incorporation of Industry 4.0 technologies. 6.6

Role of Industry 4.0 Technologies in Achieving the Sustainable Performance

Technological change is the major driver and motivator of competition. Techno­ logical innovation has changed industrial structures and helped in creating new business ventures. Due to this technological emergence, the majority of the wellknown firms that failed to adopt them have been eroded and some of the oth­ ers have gained their places. The major example of this is Nokia which refuses to adopt the technological shift and has been easily replaced by other companies small in size and capital. Therefore, competition is the initial phase in getting a competitive advantage and sustainable performance. Hence, technological innova­ tion has initiated a healthy competition among the firms of developed, developing, and emerging economies. Technological innovation is considered crucial for firms if they create healthy competition or lead to competitive advantage and industrial structural change. 6.6.1

Digitalized Technology in Value Creation

The basic shift in gaining a competitive advantage and sustainable performance is value creation through technological innovations. In the recent era, the busi­ ness activities performed in organizations are a bunch of technologies, and these technologies help to produce value creation in production and other activities. The majority of the value creation activities are carried out through the combination of technological innovation, inputs in the shape of information or material, and the human resources to produce the output. Similarly, the material handling in logistics may be carried out through the combination of traditional techniques and Industry 4.0 technologies like RFIDs, bar codes, sensors, etc. In simple words, technological innovation has not been used only in primary activities but is also used for supportive business operations. Therefore, all the inbound activities, outbound activities, operations activities and services, and marketing activities are carried out through the combination of computer-aided designs and human interaction. Hence, it is pervasive that value creation needs information that can be generated from the use of technology and involves all the categories as shown in Figure 6.2. Technological innovations are used to schedule, plan, control, and accomplish business activities.

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Case 1: The Walmart and IBM Collaboration to Trace Product Through Blockchain Spinach, lettuce, and leafy green vegetables are about to get the blockchain treatment from Walmart, as the world’s largest food retailer has announced that 100 of its veg­ etable suppliers will be asked to enter details about their products into a blockchain. The scheme enables the retailer to pinpoint the origin of every head of lettuce and bag of spinach it sells, boosting transparency in the supply chain. Queries have none­ theless been raised as to whether the move is a gimmick, or a positive step toward embedding the technology into the economy. The move was prompted following numerous cases of vegetable-associated food con­ tamination. Earlier this year, dozens of people fell sick after eating Romaine lettuce, and in 2006, an E.coli outbreak from infected spinach killed three people and affected 199. Food Contamination Fuels Call for Technology The challenge with food-borne outbreaks is to identify the batch of vegetables respon­ sible and then isolate the source to a specific location and supplier. Walmart believes that a blockchain database will allow it to track every item of leafy green vegetables back to the field where it was grown, thereby increasing transparency and saving costs, as the need to remove all spinach from sale across multiple stores in the event of a contamination scare would be eliminated. Walmart is working with IBM to create the blockchain through its IBM Food Trust system. All the data will be hosted on IBM’s cloud computers. The blockchain ledger of transactions could be the ideal system for the food supply chain, as produce can pass through multiple suppliers before it ends up on the supermarket shelf. Every time a supplier passes produce on to a new supplier, a fresh entry will be made into the blockchain, creating a record for every vegetable transaction, right back to its origin. The spinach behind the 2006 E.coli outbreak was not traced back to its contami­ nated source (a Californian farm) for 15 days. Blockchain entries would ensure the source to be instantly trackable, and tainted items removed from shelves without delay. The traceability would also eliminate the need to remove all items in the of­ fending category, as only the batch traced to the source need to be removed. System Complexity and IBM Involvement Raise Questions Blockchain is usually associated with decentralized transaction currencies like Bitcoin and Ether, where its very nature means that those participating in the currency do not need a central bank to police the system, as the software and the users create and impose the rules.

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The need for Walmart to employ such a system for its supply chain, especially one run by IBM, has raised questions: A blockchain database is self-policing—and so doesn’t need a middleman—yet IBM is setting itself up as a blockchain middleman. Of course, conventional databases can be altered, transactions may not always be logged and systems are far from tamper-proof. The attraction of blockchain for sup­ ply chain management is its immutability, but if someone in the supply chain inputs incorrect information, it can never be altered, and will infect the transparency of the chain. And if a batch of vegetables is tampered with, it can only be identified with physical checks The credibility of the blockchain depends on only correct information being uploaded. The complexity of the system, no doubt difficult to navigate for those without ex­ pertise or specific instruction, is a potential red flag. Cryptocurrencies are the domain of IT specialists who can quickly grasp the technology, spurred on by the prospect of making a profit. But mundane operations like sourcing vegetables lack this motivation. IBM’s sys­ tem has been developed for large food businesses such as Unilever, and likely requires specially trained personnel. Blockchain is being touted as an almost magical solution to multiple challenges. The UK finance minister has even suggested that blockchain could help Britain achieve frictionless trade after Brexit. Governments around the world are looking at introducing regulation to blockchain to unleash its power for financial services. Until now, blockchain has been used to create self-governing, decentralized sys­ tems such as cryptocurrencies. The big question is whether it can become an immu­ table mechanism for policing everyday transactions across society. That really would be a transformative technology.

6.6.2 Industry 4.0 in Competitive and Sustainable Advantage

The digitalized technologies that are adopted and helpful for firms to gain competi­ tive advantage and sustainable performance are discussed earlier. These technolo­ gies are incorporated by different firms to gain these advantages and are discussed in brief later. Big data predictive analytics is a collection of large amounts of data required by companies for obtaining new and valid information. In today’s world, the availabil­ ity of real-time data provides dream opportunities to firms which can be obtained through the application of new and advanced statistical tools to forecast sustainable opportunities, hence reducing the risk and increasing the feedback (Bakshi, 2012; Bartosik-Purgat & Ratajczak-Mrożek, 2018; Warner & Wäger, 2019). Similarly, blockchain technology which is also known as digital ledger technol­ ogy is a decentralized database used to record transactions for partners. Further,

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these blockchains can be public, private, or hybrid depending on the nature of record keeping. Firms are adopting these technologies to enhance transparency and reliable and fast transactions in their business operations. Various firms of dif­ ferent sectors globally implement this technology to gain faster, reliable, accurate, trusted, and authentic transaction records among business operations. These in­ dustries include financial and insurance agencies, energy and oil sectors, environ­ mental protection agencies, advertising, health, and public administration sectors (Narayanan et al., 2016).

Case 2: Google Uses AI to Design Next-Generation

Chips in Just Six Hours

Gordon Moore, the founder of Fairchild Semiconductor and Intel, in 1975 pre­ dicted that the number of transistors on an integrated circuit would double every 2 years. This observation, now known as Moore’s Law, has continued to hold true, but may very well be on the verge of being rendered obsolete. As modern-day silicon is overhauled to accommodate the intricacies of running artificial intelligence (AI) models, Google has gone the other way and is now designing chips using AI. The company explained this cyclic clockwork, research for which has been going on for well over a year, in the science publication Nature.com last week. Designing a chip, called floorplanning in technical circles, is an arduous monthslong process that has so far remained one of the few areas that haven’t been recep­ tive to automation. It seems that will change soon. “In under six hours, our method automatically generates chip floorplans that are superior or comparable to those produced by humans in all key metrics, including power consumption (Tufail et al., 2021), performance, and chip area,” explained Google in a paper authored by 20 researchers. Google itself isn’t a chip manufacturer per se but the Mountain View, CA-based company has developed several chips, and its tensor processing unit (TPU) hardware specifically to support the processing of AI workloads for internal research. Google said it is already banking on the procedure to design its next iteration of TPUs for its AI-processing data centers, and possibly other commercial use cases. Essentially, AI is being leveraged to help in the development of future-ready AI applications

Some of the other Industry 4.0 technologies include augmented reality (AR), Artificial intelligence (AI), and the Internet of things (IoT), which have been widely incorporated by many firms across the world to actualize their sustainable and competitive performance. AR has been widely recognized by many firms to achieve their extraordinary objective as AR is used to convert digital information

114 Naveed R. Khan, Muhammad Rahies Khan, and Arsalan Mujahid Ghouri into an image that can be viewed and interpreted through different devices to pro­ duce valuable and understandable knowledge (Loureiro et al., 2020). A most recent breakthrough in the field of AR is the invention of the modern telescope “James Webb Space Telescope” which is used to identify the secrets of Galaxy clusters in space. The data and images collected through this telescope are interpreted and converted into meaningful information and facts to further understand the reality and secrets of the universe.

Case 3: Artificial Intelligence and Samsung Firm Performance AI technology based on machine learning to upscale images Samsung Electronics was the first to unveil 8K AI tech for television. The technology can analyze content and can automatically upscale low-resolution images to 8K picture quality. This innova­ tion solves the current problem with the availability of high-resolution content to use on super-high resolutions screens. Now, all pictures can be transformed to 8K, which is currently the highest resolution capable in digital television.

Internet of things (IoT) refers to the network of physical things “Objects” with the internet for the sake of data and information exchange between the source and objects. These objects might be household appliances, lighting and heating equip­ ment, buses and trucks, and even wearables (Atzori et al., 2010; Wortmann & Flüchter, 2015). Globally, the majority of the firms are using this technology in their warehouses, shipment, and tracing other information from remote areas through the sensors and RFIDs to actualize competitive and sustainable perfor­ mance (Garrido-Hidalgo et al., 2020; Kukard & Wood, 2017; Khan et al., 2017; Tian, 2016; Yerpude & Singhal, 2020). Similarly, AI is the artificial data gener­ ated by machines through their intelligence and improvises human intelligence in decision-making. It is realized from the previous experience of AI that the decisions made through AI are more efficient, rational, and reliable in achieving specific and difficult organizational goals. AI has been highly recognized in indus­ tries to gain competitive and sustainable performance (Gupta et al., 2020; Kumar et al., 2020; Toorajipour et al., 2021). Machine learning is another sub-aspect of AI that is used to elaborate that the computerized systems independently and au­ tomatically acquire, learn, and adopt new information and data. The ML also has been adopted by the firms to gain and cash the emerging business opportunities that lead to their sustainable and competitive advantage in the industry (Acemoglu & Restrepo, 2018; Hirata et al., 2020). Previously discussed technologies have changed the functioning and sustainable outlook of the firms that brought prosperity and shaped the social, economic, and environmental aspects of the communities (Nisar et al., 2021). These technolo­ gies not only improve these elements but also improve and create new business

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attitudes, behaviors, and information and communication patterns among stake­ holders. One of the important stakeholders, the customers, one of the important stakeholders, have been empowered and enriched with the information and knowl­ edge and hence connected with business operations more precisely and closely (Alamäki & Korpela, 2021). Through the information, customers can much more precisely exchange their ideas and opinions with the firms and hence influence their business operations and decisions. Therefore, with the incorporation of these digitalized technologies, firms are more accurately and intensely exchanging their relations with their stakeholders and achieving efficiency, effectiveness, and com­ petitive and sustainable business operations. In short, Industry 4.0 technologies change the existing traditional business models into more precise and comprehen­ sive ones (Caputo et al., 2021; Luz Martín-Peña et al., 2018; Rachinger et al., 2018). The business models created through these technologies are more diversified and therefore reduce the reliance on the physical factors and hence provide a com­ prehensive broad spectrum of digitized business solutions like helping in creating digital and sustainable products, enhancing the digitalized sales channels, or the use of robotics in manufacturing. Besides benefits, handling Industry 4.0 technolo­ gies is a cumbersome deal for firms but if they are handled and chased through proper and planned activities, they can generate optimized business operations and sustainable business performance (Ribeiro-Navarrete et al., 2021). The adoption and utilization of these emerging technologies have been widely implemented by the banking sector in the shape of FinTech, insurance companies and financial investment funds, supply chain operations, and the marketing sector in the shape of digital marketing. 6.7

Benefits of Industry 4.0 Technologies

1. Industry 4.0 technologies provide companies with the ability to surpass the boundaries of space allowing them to access larger and diversified global mar­ kets and help them to chase competitive and sustainable growth. 2. Industry 4.0 technologies deeply affect the firm’s internal and external strategies and put significant influence on the resources and business processes that cause them to think differently and chase the market opportunities through new busi­ ness models and strategies by reducing the risk and threats. 3. Industry 4.0 technologies empower the customers by providing them infor­ mation and easy access to business news; hence, they are in a much stronger position to influence the business operations to behave in a sustainable and eco­ friendly manner. 4. Industry 4.0 has deeply affected the labor market by introducing new methods and techniques of business solutions, hence replacing the workforce with robot­ ics and other digitized solutions. These and other digitized factors put additional pressure on firms to operate and behave more sustainably and competitively in markets. 5. In financial markets, Industry 4.0 brought new methods of transactions, pay­ ments, and settlements that enhance business operations not even domestically

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but also internationally. Therefore, compel the firms to adopt these emerging technologies to be more competitive and sustainable. 6. Industry 4.0 adoption and dissemination not only impact the micro-level strate­ gies but also influence the macro-level business operation and therefore com­ pelling the international economies to consider these technologies to achieve sustainable performance. 6.8

Conclusion

This chapter has focused on the basics of Industry 4.0 technologies in business operations. This chapter covers the mostly applied and well-known Industry 4.0 technologies, defines them, and provides their little contribution to sustainable firm performance. These technologies include blockchain technology (BCT), artificial intelligence (AI), Internet of Things (IoT), robotics, machine learning (ML), simu­ lation, AR, and additive manufacturing. Further, this chapter covers the barriers to the implementation of Industry 4.0 technologies, drivers of Industry 4.0, and the benefits of their application in achieving sustainable performance. Additionally, this chapter covers the role of Industry 4.0 technologies in achieving sustainable and competitive firm performance through case studies. 6.9

References

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7

The Influence of Industry 4.0 on Client Value Added Ravi Kumar Gupta and Udit Maheshwari

7.1

The Technological Evolution of the Industry

Figure 7.1 depicts various types of industrial revolutions which include Industry 1.0, Industry 2.0, Industry 3.0, and Industry 4.0. Industry 1.0 involves the use of mechanical production which requires a huge number of human labor, and it had very low complexity in its mechanical structure. These machines were fueled by either water or steam power; these machines were very basic foundational machines with very simple mechanical structure and technology involvement which provided enough foundation for further industrial revolution (Xu et al., 2018). All the production of every kind of thing was done by humans manually without the use of any machine, whether it is related to the cooking of food items or any kind of weapons and making clothes (Qin et al., 2016). After the advent of eightieth century, various kinds of simple human-operatable machines came into existence which marked the beginning of Industrial Revolution 1.0; major factors which gave a push to the industrial revolution were mechanization of the production process to some extent while among sizable industries in which steam played a role of catalyst

Industry 3.0 (1969) - Electonics - IT Systems - Automated Production

Industry 2.0 (1870) Industry 1.0 (1784) - Mechanical production - Water and steam power

Industry 4.0 (2011) - loT - Robotics and Al - Big Data - Cloud Computing

Cyber-Physical Systems

- Division of Labor - Mass Production - Electrical Energy

lexity

Comp

First Programmable Logic Controller

First Assembly Line First Mechanical Loom 1969

1870

1784

1800

1900

2011

2000

Figure 7.1 Development of industrial revolutions Source: Demir et al. (2019) DOI: 10.4324/9781003404682-7

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for enhancing productivity (Oztemel & Gursev, 2020). This external push led to an enlargement of regular production by eight times in the textile industry alone. Steam power worked as a substitute for the physical labor of humans in textile in­ dustries; furthermore, steam also worked as a fuel in locomotives and ships which explicitly lessened the duration of the journey for both goods and people (Yavari & Pilevari, 2020; Har et al., 2022). Industry 2.0 started from the dawn of the nineteenth century; in this revolution, electricity played a prominent role as an energy source in various industries, and electricity has an advantage over steam energy that it is more convenient than the traditional steam method which again enhanced the capacity and efficiency and per­ formance of industrial units in terms of production. Simultaneously, this feature also opened doors for use of electricity in a wide variety of machines (Iyer, 2018). This version of the industrial revolution has certain features over the previous version that it helps industries to reap the benefits of division of labor which indicates human labour can perform a task according to their specialization in a particular activity which was a major contributor to high profits to whole industry sector (Drath & Horch, 2014). The third advantage of Industry 2.0 is mass production which was only possible because of the invention of electric machines which are much faster and more efficient compared to human labor; mass production was only possible because of the utilization of electricity. It also helped in the reduction of time dura­ tion of production process and cost, and it helped to gain various industries’ econo­ mies of scale advantage means less input cost for larger output (Yin et al., 2018). Industry 3.0 begins in the year 1969 in the twentieth century; this development includes better electronic machines compared to Industry 2.0 which are more capable and more efficient compared to the earlier version. In this period, majority of firms in various industries developed semi-automated machines for deployment in production units which still require much human labor to bring machines into action (Yin et al., 2018). From here the need for human labor started to reduce and the requirement for machines increased in this phase of the revolution, and now machines perform most of the task which was earlier performed by human labor physically. The third feature of this industrial revolution is the advent of Information Technology (IT) systems majorly all over the industry which has made the industry more convenient, faster, and reliable which again provided a push to mass production as the firms have more capacity to produce at less time and due to improved technology than technology under previous industrial revolution. Industry 4.0 use Information and Communication Technology (ICT) widely which plays a crucial role in it. It is an extended version of Industry 3.0 which involve more extensive use of technology in productive machines; in this, all the computer systems in the industry are connected through the internet (Foidl & Felderer, 2015). Internet and AI have broadened the scope of communication and data sharing between machines which creates space for less human labor, and more work is performed by machines themselves. Industry 4.0 resulted in more creative more intelligent machines which lead to the transformation of factories into intelligent factories, and intelligent factories consist of more connected human labor, productive machines, and various equipment used in

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industry through the network (Yan et al., 2017). This industrial revolution made the machines according to their intelligence (AI), and theme of this industrial revolution is smart manufacturing for the future. This initiative was taken by the German country. This revolution helped the industrial units to operate at a larger scale for mass production and improvement of efficiency in the production of goods. Major characteristics of this industrial revolution are more advanced ro­ botics and AI, big data, the Internet of Things, and cloud computing (Yavari & Pilevari, 2020). 7.2

Various Technologies Involved in the Technical Revolution of Industry 4.0

Industrial revolution version 4.0 involves four kinds of technologies: robotics and artificial intelligence (AI), the Internet of Things (IoT), big data, and cloud com­ puting. Demir et al. (2019). a) Robotics and Artificial Intelligence (AI): A robot is an advanced machine that can perform some particular specified functions based on instructions received by human beings; it can perform more complex tasks easily as well as in less time compared to humans. Industry 4.0 introduced more advanced robotic ma­ chines to expand production in the industry with more accuracy and on a larger scale (Graetz & Michaels, 2018). The ability of a machine to do the task with the ability to take a required decision at right time just like a normal human being with AI for smooth flow of production activities in the industry. AI makes the machine adopt human decision-making ability that makes the production activi­ ties efficient. b) Internet of Things (IoT): It means the connection of various related physical machines and equipment over the internet with help of software and sensors, which create space for data sharing among all the machines/computer devices. The machines with this technology can be operated from remote distances or without/less human intervention (Yavari & Pilevari, 2020). c) Big data: It is an amalgamation of interdisciplinary technologies that aid the cli­ ent by providing more customized and remarkable services just with the ease of a single click. Big data give an edge to the industrial unit as it helps in forecast­ ing and planning new projects and simultaneously provides concrete reasoning. The meaning of big data is humongous and diverse data available on the internet that is exploited; these data are received from machines and equipment of the production unit over the internet, and these huge data provide better ground for data analysis. In the production of goods, these data will help to optimize the process and economic cost to the firm. d) Cloud computing: This involves technological and computing services provided through the internet at a comparatively lower cost. This service is available ondemand made by the client; it includes various services such as storage of data, vast database, server, and applications. These services are provided by various companies such as Microsoft Azure, AWS, IBM Cloud, and Google Cloud.

124 7.3

Ravi Kumar Gupta and Udit Maheshwari Influence of Industry 4.0 on Client Value Added

The meaning of Industry 4.0 is already explained earlier in detail, and the client is a kind of customer who buys professional facilities from a business organization and client value added means to add more value to the service/product or make it more useful/handy for the client to operate it. Industry 4.0 adds additional ap­ plications, software, and other services which make the production or business process so convenient that it will directly responsible for an increase in mass production and cost reduction for the client company; it also helps the client to access a wide variety of services just with help of good internet connection over a network. This fourth industrial revolution helps to integrate and digitalize the whole industrial activities, it will form a value chain, and it helps in production by making it more flexible, adaptable, and efficient. These characteristics of the industrial revolution help to incorporate all the consumer needs concerning cur­ rent market trends (Lasi et al., 2014 and Gilchrist, 2016). It helps to add required customization as per the requirement of clients which means different clients will pay for what service they want to avail and the customization will add more value for the client which will increase consumer retention (Fernandez-Carames & Fraga-Lamas, 2019). It also has the potential for flexibility in production activities that will have an explicit impact on the economic cost to the client and make the present factory units smarter technologically. The service providers work more on services to make them more compatible according to the demand of the client. In the previous indus­ trial revolution if a company (client) want to use a particular service, then the only possible option available at his disposal is to purchase the whole machinery\com­ puter system which will increase the cost to the company. This problem is solved by fourth industrial revolution by the usage of the product like paid service to the clients over the internet with minimum cost. All decisions taken by the production unit are based on actual information received from the machines over the network, and these data will be analyzed to bring rational findings out of consumers and data of industry which help to obtain a maximum output with minimum inputs. It also made technology more efficient; this has helped in reducing time for manufactur­ ing in terms of both promotion and designing more customized products, so the client will be more inclined to such kinds of services (Lepore et al., 2022). This technology will also create paths for more innovations in manufacturing industries as many possible defects can be eliminated just by virtually experimenting with it over the network and more optimizations can be done with assembly lines in indus­ tries (Alcácer & Cruz-Machado, 2019). Industry 4.0 holds a potential of value addition of about 3.7 trillion dollars by 2025. At present only 30% of business organizations can take advantage and obtain value addition from this industrial revolution which is quite less, but considering the potential of Industry 4.0, it will extend its roots soon in all industries as more business firms are adopting technologically advance machines for enhancing their production capacity, efficiency, and quality and also trying to economize their cost and optimum utilization from same inputs used before (Garms et al., 2019).

The Influence of Industry 4.0 on Client Value Added 7.4

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Hurdles in Way of Effective Implementation of Industry 4.0

Some factors are accountable for the slow growth of Industry 4.0 in different indus­ tries, and other factors which affect indirectly are business organization anchoring and issues in governance (Garms et al., 2019; Horváth & Szabó, 2019). a) Absence of knowledge and resources to scale: Many business organizations do not have enough knowledge to scale their business operations, and many pro­ duction units do not have the financial and other resources required to expand. According to data only 55% of business firms have clear knowledge about how to expand their business operations. Simultaneously they can procure required resources for the business operations to obtain scale and its advantages in their business. If any firm does not have proper knowledge concerning operations of business activities at a larger scale, then it will not be able to make optimum utilization of resources. This will make the firm inefficient in terms of underutilizing technology of the fourth industrial revolution (Luthra & Mangla, 2018). b) Scaling involves high cost: Scaling means to bring the business firmly on the path of growth but for this company requires a huge amount of investment in physical and financial capital, which becomes an immediate financial burden on the company for a short-run period as in long run the investment will generate enough income to the company to pay its own expense and profit too. Scaling is important for a business as it helps a company to acquire economies of scale advantage and also creates enough space for innovation and diversification of the product. c) Absence of knowledge regarding business value added: Many business organiza­ tions are not ready to implement this technology in their firms as they lack the knowledge of the benefits that they can reap from it. Ignorance becomes a problem many times in way of new technologies though they are efficient and beneficial; technologies introduced industrial revolution can increase the chances of value ad­ dition in their product which will prove to be a profitable deal for the client firms. Value is the only thing that is prominent when making any purchasing decision by the customer, as the value will satisfy his wants but if a consumer gets more value added to a product by the particular firm, then this will increase the chances of purchasing decision to be in favor of concerned product (Culot et al., 2019). d) Online threat to the security of confidential data of industry: Like every indus­ try using technology developed through Industry 4.0, this technology connects almost everything to the internet, so there are higher chances for any industry to be a vulnerable target for hackers because every data will be stored online and transmitted over the network by machines and equipment to the service pro­ vider. Few industries are not ready to implement Industry 4.0 technology due to these potential online vulnerabilities as they value their security more than any technological upgradation (Schneider, 2018). e) Requirement of highly skilled human labor: As under this industrial revolution’s technology is getting more advanced and complex, so this cannot be managed by semi-skilled labor. The production units have to hire more specialized human labor

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to operate these high-tech machines. This can create a short-term gap in employ­ ment opportunities for semi-skilled and non-skilled workers, in the long-term situ­ ation unemployment may get on the right track but in the short run. This can create huge pressure on unemployed and employed workers (Kerin & Pham, 2019).

7.5

Conclusion

The fourth industrial revolution has made revolutionary changes in the whole pro­ duction process with the introduction of advanced online services such as robotics and AI, IoT, cloud computing, and big data, which have enabled machines and equip­ ment to communicate (Schumacher et al., 2016) and share data of production on a real-time basis over the internet to e-retailer for analysis which have lowered the scope for physical human labor requirement as mostly all the machines in produc­ tion unit become automatic and robots have taken place of physical human labor. Fully automatic and technologically advanced machines can help a firm to achieve mass production, and more customized products can be produced by industrial units (Vaidya et al., 2018). The e-retailer will utilize the data accumulated by machines over the network to find problems in the existing production process and also forecast future problems (Tjahjono et al., 2017); it not only aids to find problems and making forecasts but also helps to provide details about possible solutions to be implemented for optimization of the production process for maximum output with the same input, while maintaining an economic cost structure for the client firm (Saucedo-Martínez et al., 2018). The fourth industrial revolution has contributed immensely in terms of value added to clients as they can get more specialized and customized products produced along with economic pricing (Li et al., 2017). 7.6

References

Alcácer, V., & Cruz-Machado, V. (2019). Scanning the Industry 4.0: A literature review on technologies for manufacturing systems. Engineering Science and Technology, an Inter­ national Journal, 22(3), 899–919. Bai, C., Dallasega, P., Orzes, G., & Sarkis, J. (2020). Industry 4.0 technologies assessment: A sustainability perspective. International Journal of Production Economics, 229, 107776. Culot, G., Fattori, F., Podrecca, M., & Sartor, M. (2019). Addressing Industry 4.0 cybersecu­ rity challenges. IEEE Engineering Management Review, 47(3), 79–86. Demir, K. A., Döven, G., & Sezen, B. (2019). Industry 5.0 and human-robot co-working. Procedia Computer Science, 158, 688–695. Drath, R., & Horch, A. (2014). Industrie 4.0: Hit or hype? [industry forum]. IEEE Industrial Electronics Magazine, 8(2), 56–58. Fernandez-Carames, T. M., & Fraga-Lamas, P. (2019). A review on the application of blockchain to the next generation of cybersecure Industry 4.0 smart factories. IEEE Access, 7, 45201–45218. Foidl, H., & Felderer, M. (2015, November). Research challenges of Industry 4.0 for quality management. In International conference on enterprise resource planning sys­ tems (pp. 121–137). Cham: Springer.

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Garms, F., Jansen, C., Schmitz, C., Hallerstede, S., & Tschiesner, A. (2019, Septem­ ber 13). Capturing value at scale in discrete manufacturing with Industry 4.0. Captur­ ing value at scale in discrete manufacturing with Industry 4.0. Retrieved March 30, 2022, from https://www.mckinsey.com/industries/advanced-electronics/our-insights/ capturing-value-at-scale-in-discrete-manufacturing-with-industry-4-0 Gilchrist, A. (2016). Introducing Industry 4.0. In Industry 4.0 (pp. 195–215). Berkeley, CA: Apress. Graetz, G., & Michaels, G. (2018). Robots at work. Review of Economics and Statis­ tics, 100(5), 753–768. Har, L. L., Rashid, U. K., Te Chuan, L., Sen, S. C., & Xia, L. Y. (2022). Revolution of retail In­ dustry: From perspective of retail 1.0 to 4.0. Procedia Computer Science, 200, 1615–1625. Horváth, D., & Szabó, R. Z. (2019). Driving forces and barriers of Industry 4.0: Do multi­ national and small and medium-sized companies have equal opportunities? Technological Forecasting and Social Change, 146, 119–132. Iyer, A. (2018). Moving from Industry 2.0 to Industry 4.0: A case study from India on leap­ frogging in smart manufacturing. Procedia Manufacturing, 21, 663–670. Kerin, M., & Pham, D. T. (2019). A review of emerging Industry 4.0 technologies in remanufacturing. Journal of Cleaner Production, 237, 117805. Lasi, H., Fettke, P., Kemper, H. G., Feld, T., & Hoffmann, M. (2014). Industry 4.0. Busi­ ness & Information Systems Engineering, 6(4), 239–242. Lepore, D., Dubbini, S., Micozzi, A., & Spigarelli, F. (2022). Knowledge sharing opportuni­ ties for Industry 4.0 firms. Journal of the Knowledge Economy, 13(1), 501–520. Li, G., Hou, Y., & Wu, A. (2017). Fourth industrial revolution: Technological drivers, im­ pacts and coping methods. Chinese Geographical Science, 27(4), 626–637. Luthra, S., & Mangla, S. K. (2018). Evaluating challenges to Industry 4.0 initiatives for supply chain sustainability in emerging economies. Process Safety and Environmental Protection, 117, 168–179. Mofolasayo, A., Young, S., Martinez, P., & Ahmad, R. (2022). How to adapt lean prac­ tices in SMEs to support Industry 4.0 in manufacturing. Procedia Computer Science, 200, 934–943. https://doi.org/10.1016/j.procs.2022.01.291 Oztemel, E., & Gursev, S. (2020). Literature review of Industry 4.0 and related technolo­ gies. Journal of Intelligent Manufacturing, 31(1), 127–182. Qin, J., Liu, Y., & Grosvenor, R. (2016). A categorical framework of manufacturing for Industry 4.0 and beyond. Procedia CIRP, 52, 173–178. Roblek, V., Meško, M., & Krapež, A. (2016). A complex view of industry 4.0. Sage Open, 6(2). Saucedo-Martínez, J. A., Pérez-Lara, M., Marmolejo-Saucedo, J. A., Salais-Fierro, T. E., & Vasant, P. (2018). Industry 4.0 framework for management and operations: A re­ view. Journal of Ambient Intelligence and Humanized Computing, 9(3), 789–801. Schneider, P. (2018). Managerial challenges of Industry 4.0: An empirically backed research agenda for a nascent field. Review of Managerial Science, 12(3), 803–848. Schumacher, A., Erol, S., & Sihn, W. (2016). A maturity model for assessing Industry 4.0 readiness and maturity of manufacturing enterprises. Procedia CIRP, 52, 161–166. Tjahjono, B., Esplugues, C., Ares, E., & Pelaez, G. (2017). What does Industry 4.0 mean to supply chain? Procedia Manufacturing, 13, 1175–1182. Vaidya, S., Ambad, P., & Bhosle, S. (2018). Industry 4.0–a glimpse. Procedia Manufactur­ ing, 20, 233–238. Xu, L. D., Xu, E. L., & Li, L. (2018). Industry 4.0: State of the art and future trends. Inter­ national Journal of Production Research, 56(8), 2941–2962.

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Xu, X., Lu, Y., Vogel-Heuser, B., & Wang, L. (2021). Industry 4.0 and Industry 5.0— Inception, conception and perception. Journal of Manufacturing Systems, 61, 530–535. Yan, J., Meng, Y., Lu, L., & Li, L. (2017). Industrial big data in an Industry 4.0 environ­ ment: Challenges, schemes, and applications for predictive maintenance. IEEE Access, 5, 23484–23491. Yavari, F., & Pilevari, N. (2020). Industry revolutions development from Industry 1.0 to Industry 5.0 in manufacturing. Journal of Industrial Strategic Management, 5(2), 44–63. Yin, Y., Stecke, K. E., & Li, D. (2018). The evolution of production systems from Indus­ try 2.0 through Industry 4.0. International Journal of Production Research, 56(1–2), 848–861.

8

Quality Management for Assurance Value of the Customer in Industry 4.0 Times Hana Štverková and Michal Pohludka

8.1

Background of the Study

Two areas that are considered fundamental are customer service quality and cus­ tomer satisfaction. And these two fundamental areas form the basis of marketing theory and practice (Spreng et al., 1995). In nowadays current dynamic and intensely competitive environment, the key to sustained competitive advantage lies in the provision of high-quality services that will lead to loyal and satisfied custom­ ers (Shemwell et al., 1998). Consumers have a wide variety of products and services offered to choose from, so their purchasing choices logically lead to higher quality products at comparable prices. All producers have to comply with legislative and other mandatory require­ ments, so they cannot compete too much in this respect. In an era of intense global competition, many organizations have now shifted the service quality paradigm to the customer perspective (Parasuraman et al., 1988, 1991). Based on this paradigm, the customer judges the quality of the service provided and determines whether it has met their expectations (Adner & Kappor, 2010; Parasuraman et al., 1988). In today’s dynamically changing environment, customer interests are shifting toward sustainability. The expectations of employ­ ees, customers, and regulators, as well as changing business conditions, are forcing them to respond and build their operations on the principles of sustainable busi­ ness. While large global corporations are already integrating the topic into their strategies, small companies are still waiting for this step. Companies also need to become a much more active player and participate with others in creating solutions for important areas such as the labor market, diversity, education, and the use of natural resources. The trend of shifting from corporate charity or philanthropy, which was the key ten years ago, to corporate social responsibility (CSR) and sustainable business is gaining momentum. The values that are associated with sustainable business are becoming the basis of companies’ future development strategies. Responsibility and sustainability is thus becoming one of the important elements of business suc­ cess. In recent years, most multinational and small companies have realized that the world in which they do business is changing radically. Thus, companies are linking their social responsibility and sustainability programs with how to respond DOI: 10.4324/9781003404682-8

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to demographic changes, the situation in the labor market, decreasing availability of resources, changes in the climate, and changing expectations of customers or the public. All of this brings companies not only competitive advantage but also eco­ nomic savings, and is reflected in their reputation (Peris-Ortiz et al., 2015; Spreng et al., 2009). Industry 4.0 affects industrial processes, the management of organizations of all types and sizes, and changes quality practices and methodologies. Quality 4.0 includes quality tools combined with new Industry 4.0 technologies (Caruana et al., 2000; Chiarini, 2020). Industry 4.0 is not just industrial robots, production automation, or digitalization, but above all the ability to use these three compo­ nents to make production more efficient, flexible, and precise, while saving human resources, raw materials, and costs. But the main change must come in the way we think about and plan production. By incorporating programmable machines, artificial intelligence, and the Internet of Things (IoT), it will be possible to make production flexible to the very limits of what is possible—production will gradu­ ally become individualized so that we do not choose from clothes made in a batch of ten thousand pieces, but buy trousers that, although made by machines, are made exactly to our specifications (National Centre for Industry 4.0, 2018). Sustainable entrepreneurship and its principles will inevitably come to all com­ panies of all sizes and will bring about the transformation that businesses around the world underwent in the 1980s and 1990s. At that time, quality standards were massively introduced, new positions of quality managers were established, and the topic really reached from large companies to the last supplier. The same devel­ opment awaits responsible and sustainable business. Business in a context helps companies predict and manage risks, reduce costs, increase success by helping customers live more responsibly, win new markets, etc., through product innova­ tion. This is directed toward customer satisfaction according to product and service quality requirements. Quality management for customer value in the era of Industry 4.0 combines two interrelated aspects. First, the need for a highly innovative digital sector—Europe’s ICT industry (production of digital goods from components to software products) now accounts for around 4% of GDP and almost 10% of total value added of industrial activity, including the ability to introduce digital innovation in all sectors—studies show that digitization of products and services should increase the annual revenues of industry in Europe by more than €110 billion. Currently, almost a third of the growth in total industrial production in Europe comes from the use of digital technologies (MPO, 2017), and second, a satisfied customer. It is extremely important to put yourself in the shoes of your customers and find out what is im­ portant to them and what they base their decisions on. This is the only way to reach people in a way that will engage them and persuade them to buy. 8.2

Customer’s Value Before and in Industry 4.0 Times

It is imperative to understand the nature of the concept and how value is measured in the market. The definition of the concept of value is expressed as a monetary

Quality Management for Assurance Value of the Customer 131 sum that incorporates the technical, economic, social, and service benefits that the customer receives through exchange for the price they pay for the product (Ander­ son & Narus, 1998; Anderson et al., 2006). The most common definition used by scientists is defuinition of Zeithaml (1988), “Perceived value is the consumer’s overall assessment of the utility of a product based on perceptions of what is received and what is given.” Second oftenused definition is “Customer value is a customer’s perceived preference for an evaluation of those product attributes, attribute performances, and consequences arising from use that facilitate (or block) achieving the customer’s goals and pur­ poses in use situations” (Woodruff, 1997). Sheth et al. (1991) identified five areas that they consider to be values influ­ encing customer behavior: the first being functional value, followed by emotional value, social value, epistemic value, and last but not least conditional value. Customer value is defined by Holbrook (2005) as interactive, relativistic in a way of comparison of objects or differs between persons; or situation dependent, and embodies preferences; and is attached not to the object itself but rather to the relevant consumption experience. Another point of view is to define the customer value done by Pynnönen et al. (2011) as the systemic customer value reflects the value delivered to the customer which is dependent on more than one attribute, and possibly on more than one firm. In the B2B context, customer-perceived value is conceptualized by cognitive construct, pre-/post-purchase perspective, strategic orientation, present and potential customers, and suppliers’ and competitors’ offerings (Eggert & Wolfgang, 2002). Customer value can be seen as an outcome of managerial and industrial mecha­ nisms (Teece, 2010) or as a consequence that connects a company’s innovative technology to customer needs. Thus, the customer value in the current era of In­ dustry 4.0 represents a new concept that complements processes, products, and organizational processes based on networking and learning potential, incorporates the relationship in new forms of collaboration and cooperation, and provides return for the customer and thus value for the company. Customer value models are based on an assessment of the costs and benefits of a given market offering in a specific customer environment and by usage. Depend­ ing on the circumstances, information from the customer, the supplier may build a value model for an individual customer or for a market segment based on data collected from several customers in that segment. The value for customer value is a prerequisite for customer satisfaction (Lam, 2004; Spiteri & Dion, 2004). It has been shown that it is more economically advantageous for firms to re­ tain existing customers than to acquiring new ones, because it saves the firm the marketing costs associated with acquiring new customers. Miner and Wain (1994) report that the cost of acquiring a new customer is at least five times higher than the cost of retaining an existing customer. Word-of-mouth communication plays an im­ portant role. Research shows that satisfied customer communicates their positive experience to typically 4–5 individuals, while dissatisfied customer will share their negative experience with 9–10 people (Kendall, 2006). For tracking, satisfaction is to create a benchmark for comparing companies and a tool for predicting trends.

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As opposed to customer value, which has been the focus of most of the litera­ ture over the last 20 years, there is a large body of research devoted to the area of customer satisfaction and its measurement. There are several models in satisfac­ tion theory that have been developed to measure customer satisfaction which are characterized by different strengths and weaknesses. The most commonly used theoretical basis for customer satisfaction research, however, is disconfirmation model, which was developed in 1980s (Oliver, 2009). 8.3

Customer Satisfaction

There is a growing need to deal not only with man in the broadest sense but also with the intellectual capital, particularly in terms of substance, improving man­ agement, increasing competitiveness (Blažek, 2014), and reasons for determining customer value. A fundamental contradiction in the definition of customer satisfaction is evi­ dent in the debate over whether satisfaction is a process or an outcome (Yi, 1990). There are a number of definitions of consumer satisfaction focusing primarily on the evaluation process (e.g., Fornell, 1992; Hunt, 1977; Oliver, 1980, 1981) or on the response to the evaluation process (e.g., Halstead et al., 1994; Howard & Sheth, 1969; Oliver, 1997, 1981; Tse & Wilton, 1988; Westbrook & Reilly, 1983). It is evident that customer satisfaction is converted into customer loyalty (For­ nell, 1992), which in turn translated into the performance (profitability) of the or­ ganization (Bowen & Chen, 2001). Questions arise as to how to define customer satisfaction, how to define customer value, and which factors influence it. Cus­ tomer satisfaction is the major challenge which is to be successfully put in place the organizing structure, systems, and process which tackles the root causes of dissatisfaction. Customer satisfaction is formed as a cognitive evaluation of the attributes that the customer is associated with the service (Chadee & Mattsson, 1996). It occurs during so-called moments of truth, that is, in moments of direct contact with the customer or when the customer consumes service. During these moments of truth, customers form opinions about the quality of the service by comparing their expec­ tations with the actual outcome (Evans & Lindsay, 2004). Customer satisfaction is a feeling (disappointment or pleasure) that depends on the comparison of the actual and expected benefits of the product. A customer can achieve several levels of satisfaction. If the product meets the customer’s expectations, the customer is satisfied; if it exceeds the customer’s expectations, the customer is very satisfied. “Customer satisfaction depends on the customer’s feelings of pleasure or disap­ pointment, resulting from a comparison of consumer performance (consumer util­ ity) and expected performance” (Kotler, 2006). “Overall satisfaction is defined as an effective statement about emotional reactions to the experience of products and services, which is influenced by customer satisfaction with these products and by the information used to select products” (Caruana et al., 2000). Important factors that influence customer satisfaction based on previous re­ search (Ruiz-Delatorre & Sanchez-Bote, 2021) are product knowledge, customer

Quality Management for Assurance Value of the Customer 133 behavioral loyalty, and perceived product value. At the same time, customer satis­ faction was defined as an indicator composed of five sub-factors: image, customer expectations, perceived product quality, perceived product value, and complaints. Also, loyalty can be considered as a two-dimensional variable, with a component of behavioral (relating to behavior) and an attitudinal component. 8.4

Assure the Customer Value

Trends in markets are leading to target Industry 4.0 and Economy 4.0, especially in terms of new technologies, gradual transformation, and digitalization of enter­ prises, including automation. An appropriate organizational structure coupled with functional operations will lead to a stronger market position for the business. These are not the only key aspects for the success of a business but the key aspect is a satisfied customer. It can therefore be concluded that in recent years, an increasing trend toward focusing on the customer and their needs has prevailed. A very important aspect of any company’s operation, apart from financial health, is a satisfied customer, which, among other things, also helps to fill the company’s revenue component, and therefore their loyalty and repeat purchase are desirable. Businesses should address the requirements and what is expected by their customers so that they can meet these. In fact, a satisfied customer is one of the possible elements of achieving competitiveness and also one of the paths to growth and expansion of a company. It is therefore essential that busi­ nesses analyze their customers’ requirements, meet them, and strive for continual improvement of quality. Quality management is an integral component of a com­ pany’s operations and should be continuously improved. With the help of proper customer fulfillment, customers are satisfied, return, profits increase, and cus­ tomer loyalty increases referrals and reduces some of the company’s expenses (Štverková, 2014). Segmenting customers is essential to properly maintain customer value. Mar­ keting management is essential for proper business management, and one of the methods is just market segmentation, especially business environment analysis. The business environment is split into homogeneous groups of customers accord­ ing to some aspects. Market segmentation is the inclusion of customers into seg­ ments with similar characteristics, where an effort is made to identify customer needs according to individual specifics. For those organizations that are able to determine unserved market segments, they can achieve a leading position in that market provided they find them first and provide them with their services. Under­ standing the specific needs of each segment forces companies to develop and offer product or marketing programs to groups of customers who have similar buying criteria. To make segmentation effective, it is necessary to focus on the company’s portfolio, to specify the offer for the given customer segments. And focus on the profitability and shift to where the company has a competitive advantage. A com­ pany can use customer segmentation as a basic way to allocate resources in terms of further product development, marketing, services, and distribution programs (Pohludka & Štverková, 2019).

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In the literature, it is possible to encounter a number of different criteria for customer segmentation. Here, we define the basic division (Lam, 2004; Spiteri & Dion, 2004): • • • • •

Geographical Demographic Socio-economic Psychological Purchasing behavior

The next step is to identify needs and wishes. The requirements set by customers are the cornerstone for the character of satisfaction. Fulfilling the ideal state of satisfac­ tion is determined by setting customer requirements according to their rational rea­ soning, that is, according to experience, available information, and set expectations. Use QFD methods to identify customer requirements and focus on translating them into technical parameters. QFD is a structured method by which diverse customer requirements are translated into corresponding technical specifications at all stages of product development and production preparation. The method helps in planning design and development priorities based directly on customer requirements. The basic principle is a single query, where we force the customer to define his needs and requirements for the product or service. This elicits the most intimate customer requirements, and these are transcribed into technical parameters for the product. Visualizing this method helps to limit changes to the product, leads to reduced pro­ duction time, and also improves the overall quality of production (Blecharz, 2015). Another possibility is to use the European Customer Satisfaction Index (ECSI) to determine customer satisfaction with seven hypothetical variables and set up new rules for the operation of the company from processes through individual departments. The ECSI method is used to determine an indicator that expresses customer satisfaction. The indicator is the customer satisfaction index. The ECSI allows companies to evaluate the contentment customer satisfaction level; it is pos­ sible to test services or even products (Blecharz, 2015). The method is a proven model for assessing customer satisfaction and is ahead in forecasting customer retention. The ECSI model consists of the seven hypothetical (latent) variables: perception quality, expectations, perceived value, satisfaction, loyalty, image, and customer complaints. Variables such as image, expectation, perceived value, and perceived quality are perceived as causes to explain customer satisfaction, and the results are customer retention and customer compliance. Customer satisfaction as a hypothetical variable expresses how the customer perceives the resolution of his/her problem or need (Blecharz, 2015). Customer satisfaction is also determined by the overall satisfaction of needs and the matching between the customer’s preferences and the actual benefits received. From previous discussion, it is clear that if we have a good customer database and understand the needs of individual customers, including their buying potential, etc., then we are able to create certain groups of customers from many perspec­ tives. This allows us to completely manage the business activities and especially

Quality Management for Assurance Value of the Customer 135 the activities related to marketing of the company, setting prices, and not only to cover the needs of customers but, on the contrary, to create the needs, which is then already the peak of sales skills, which are based on detailed and detailed knowl­ edge of customers with subsequent targeted marketing and sales strategy. Customer segmentation leading to sustainable development is only possible in a healthy company with a well-functioning CRM system. If there is up-to-date data in the CRM system and of a comprehensive features of product portfolio, business potential, etc., properly setup segmentation is suitable for wide use in the enterprise. It is also possible to implement Key Account Management on the basis of qual­ ity customer segmentation, which in many companies ensures permanent and sta­ ble growth. Key Account Management is a methodical framework for managing relationships with vital customers. The basic idea is that customers who bring in a decisive part of the sales/profit need to be taken care of more than others. In global and transnational instances, a Key Account Manager is usually assigned to major customers. This person tries to form relationships with key customers, analyzes and verifies their needs and satisfies them, and also creates barriers to entry for competitors. Perhaps a more important criterion for segmenting and assigning a customer to a key account group is their future potential and the ability to influence purchasing decisions by other customers (Pohludka & Štverková, 2019). The father of strategic management, Peter Drucker stated that everything that is measured should be managed. That is why customer lifetime value (CLV) is seen as an important metric through which corporate strategies, goals, and budgets can be set, process improvement, profit improvement, and ultimately overall business growth. The basic method of calculating CLV is a simple equation: CLV = average purchase value ´ purchase of frequency per year ´ averagee lenght of relationship When determining the average price of an order, we recommend working with a minimum of 3 months, ideally longer. Information on how long the customer has been buying is given in years. For this reason, it is advisable to have a well-setup CRM system. Companies in the market are realizing this trend, which is lead­ ing them to implement various CRM systems; monolingual and “cloud-based” are preferred. An important requirement for CRM systems is its availability from any­ where in the world, but even these solutions have their weaknesses, especially the size and require proper setup of the entire system, including detailed distribution of powers and access for individual persons in the system. CRM systems no longer work only on information about customers and mana­ gerial activities. Ideally, the CRM system should be connected with the company’s ERP system and have all the important data in one place. He could see financial documents like individual invoices at any time. For most businesses, a functional CRM system is a competitive advantage. This integrated management system helps to manage all activities from marketing to financial aspects of profit, linking operations and logistics, including technical and social aspects.

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One of the possible uses of the resulting CLV is to determine the maximum amount that a company wants to invest in acquiring a new customer. This is the value that should be used correctly in this calculation. However, it is often used instead of the average purchase value, which is an order of magnitude lower. Ac­ cording to eConsultancy.com, it clearly pays to focus on existing clients, where the probability of (further) purchase is between 60% and 70%. For new customers, the numbers are much lower, between 5% and 20%. It is generally easier and cheaper to persuade an existing customer to make a repeat purchase than it is to attract simi­ larly valuable new customers and get them to buy for the first time. But of course, this is not true for all business sectors, and in some sectors the opposite is even true. 8.5

The Czech Example

The Czech Republic is a traditional industrial country, which still has one of the highest levels of industry as a share of the total corporate economy (over 45%) or of total gross value added in the EU. The total amount of secondary sector work­ ers exceeds 1.5 million and is almost one-third concentrated in the areas of mo­ tor vehicle manufacturing, production of metal structures and metal products, and manufacture of machinery and equipment. The adoption of technologies based on Industry 4.0 in the Czechia is predominantly driven by large manufacturing enter­ prises, especially in the automotive and engineering sectors (OECD, 2017). The Czech Republic is going against the trend of reducing the share of indus­ try in total employment. The automotive industry and its downstream sub-supply chains account for a significant share of industrial production. This industrial sec­ tor is characterized by a rapid adaptation of new technologies, but at the same time, with the development of autonomous driving, electromobility, and modern mobility concepts, significant changes in the sector’s products themselves can be expected in the future (OECD, 2017). For SMEs, new technologies are financially very costly. Therefore, most of them adopt a wait-and-see tactic, waiting for tech­ nologies to become cheaper or until they find a suitable subsidy that can be used in their case. According to the ongoing changes due to digitalization and automation caused by the implementation of Industry 4.0 elements in various sectors (pharma, electro, automotive, etc.), the goal is to fully digitally connect all levels of value creation—the entire transformation process from input to handover to the customer. This is a whole radical change, leading to improved investment planning in all types of companies. Czech companies are still not yet able to sufficiently exploit the potential of digitization. There is limited data sharing between businesses in the Czech Republic; Czech Statistical Office statistics, ČSÚ (2016) show that less than 10% of small busi­ nesses, 15% of medium-sized businesses, and approximately 32% of large busi­ nesses implement electronic data interchange (EDI) communication in purchasing and sales. Similar is the case with the use of various information systems such as enterprise resource planning (ERP)—only 21% of small enterprises use it com­ pared to 82% of large enterprises. Customer relationship management (CRM) is

Quality Management for Assurance Value of the Customer 137 used by 17% of small enterprises compared to 47% of large enterprises, and RFID identification system is used by 3% of small enterprises, 13% of medium enter­ prises, and less than 27% of large enterprises. Thus, it is clear that horizontal link­ ages are insufficient and underutilized in enterprises in the Czech Republic. EY’s study was conducted in the summer of 2018 and 183 companies were surveyed, more than half of which intend to spend more than 10% of their capital expenditure on implementing new tools in the coming years. But the biggest obstacle for them is the lack of qualified staff. According to the research, significant bottlenecks to adoption include the lack of manpower at 50%, return on investment in 35%, total investment in 33%, lack of awareness of Industry 4.0 in 16%, and lack of advanced technology in 15%. Czech companies are overwhelmingly addressing and testing partial issues and not exploiting the potential of new technologies for fundamental transformation and development. It is quite obvious that Czech enterprises cannot define the concrete benefits of new technologies (Zizka, 2018). So it is advisable to focus on the customer, segment them, meet their needs and expectations, and start using digitalization as a competitive advantage even in respect of production quality, but also regards streamlining and simplifying the company’s operations. 8.6

Conclusion

The transformation of the business ecosystem especially through Industry 4.0 ap­ plications is a generator of change in the market. In this area, it has a major impact on the operations and functioning of businesses, and is related to a satisfied, stable, and loyal customer. Therefore, in today’s dynamic and competitive environment, the key element is the customer, especially in meeting their needs beyond their expectations. Monitoring its satisfaction is essential; it is imperative to monitor image perception, quality, and these basic areas determine the value of customer satisfaction and its evolution at the time it is identified by customer preferences. Customers are the ultimate source of revenue for a business. An increase or de­ crease in revenue affects the company’s operations, and this has the effect of reduc­ ing interest in the company as a whole and can weaken the company economically. It is logical then that decreasing customer satisfaction may be reflected in the func­ tioning of all other internal processes of the company. One possible route is to meet customer needs through sustainable business, innovation, and social impact. The concept of sustainable business is not new; in a sense, it can be seen as a return to its roots. It is not enough to look at a company’s competitiveness only in terms of financial health, production, marketing, management, etc.; it is necessary to exam­ ine competitiveness in terms of new dimensions, especially in terms of long-term business sustainability (Štverková & Pohludka, 2021). Signs of a change in consumer mindset are beginning to emerge as retailers offer consumers differentiated and innovative products at the right price. The principles of continuous improvement are based on the requirements of customers, whether satisfied or dissatisfied, and these requirements should be reflected in the correct

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setup and functioning of business processes. Satisfied customers are important be­ cause they return and give positive references. The benefit for the company is the knowledge of the requirements of the dissatisfied customer; it is necessary to find out the causes of their dissatisfaction and eliminate them. Knowing and identifying customer requirements is a fundamental basis for a successful business. If the customer knows the product well and is satisfied with the ratio of its over­ all quality and price, he has no reason to change the manufacturer of this product, or on the contrary, he has a reason to buy not only the same product that suits him (he is satisfied with the degree and manner of satisfaction of his requirements), but above all, he has a reason to buy that product from the same manufacturer. This then means for the manufacturer not only an immediate increase in performance due to the first purchase but above all the maintenance of this rate performance through repeat purchases by the customer due to increased customer loyalty. The Industry 4.0 concept represents the dawn of digital transformation, where the strategy of the Quality 4.0 concept is taking shape and the impact of the use of digital data, including its scalability and connectivity, the use of analytical tools, and especially networking and collaboration, is evident and visible. People, ma­ chines, and data are being connected, and technologies are being transformed through the development of scientific theories. New digital technologies are mainly used in cutting-edge enterprises in con­ sumer electronics, medicine, and high tech to transform corporate culture from leadership, to operations, to setting standards. The concept of Quality 4.0 is trans­ forming the way devices are designed, their functionality, manufacturing processes, supply chain strategies, the form of customer servicing, and methods of conducting quality management systems that conform to the standards of regulatory bodies such as the FDA and ISO. Smart and connected technologies are rapidly expanding as manufacturers look for any advantage in bringing innovative products to market, making it easier to outpace existing competitors. Industry 4.0 is not just industrial robots, production automation or digitalization, but above all the ability to use these three components to make production more efficient, flexible, and precise, while saving human resources, raw materials, and costs. But the main change must come in the way we think about and plan production. By incorporating program­ mable machines, artificial intelligence, and the Internet of Things (IoT), it make production more flexible to the very limits of what is possible—production will gradually become individualized so that we do not choose from clothes made in a batch of 10,000 pieces, but buy trousers that, although made by machines, are made exactly to our specifications (National Centre for Industry 4.0, 2018). 8.7

References

Adner, R., & Kappor, R. (2010). Value creation in innovation ecosystems: How the structure of technological interdependence affects firm performance in new technology genera­ tions. Strategic Management Journal, 31: 306–333. Anderson, J. C., & Narus, J. A. (1998). Business market management: Understanding. Cre­ ating and delivering value. Upper Saddle River, NJ: Prentice-Hall.

Quality Management for Assurance Value of the Customer 139 Anderson, J. C., Narus, J. A., & Van Rossum, W. (2006). Customer value propositions in business markets. Harvard Business Review, March: 91–99. Blažek, L. (2014). Společenská odpovědnost nadnárodních společností. In Aktuálne prob­ lémy podnikovej sféry, Slovenská republika, Bratislava: Ekonóm (pp. 19–31). Blecharz, P. (2015). Kvalita a zákazník. Praha: Ekopress. Bowen, T. J., & Chen, S. (2001). The relationship between customer loyalty and customer satisfaction. International Journal of Contemporary Hospitality Management, 13(5): 213–217. Caruana, A., Money, A. H., & Berthon, P. R. (2000). Service quality and satisfaction— The moderating role of value. European Journal of Marketing, 34: 1338–1352. Chadee, D. D., & Mattsson, J. (1996). An empirical assessment of customer satisfaction in tourism. The Service Industries Journal, 16(3): 305–320. Chiarini, A. (2020). Industry 4.0, quality management and TQM world. A systematic lit­ erature review and a proposed agenda for further research. The TQM Journal, 32(4): 603–616. ČSÚ. (2016). https://www.czso.cz/csu/czso/informacni-spolecnost-v-cislech-2016 Eggert, A., & Wolfgang, U. (2002). Customer perceived value: A substitute for satisfaction in business markets? Journal of Business & Industrial Marketing, 17(2/3): 107–118. Evans, J. R., & Lindsay, W. M. (2004). The management and control of quality (6th ed.). New York: West Publishing Company. Fornell, C. (1992). A national customer satisfaction barometer: The Swedish experience. Journal of Marketing, 56 (January): 6–21. Halstead, D., Hartman, D., & Schmidt, S. L. (1994). Multisource effects on the satisfaction formation process. Journal of the Academy of Marketing Science, 22 (Spring): 114–129. Holbrook, M. B. (2005). Customer value and autoethnography: Subjective personal intro­ spection and the meanings of a photograph collection. Journal of Business Research, 25: 45–61. Howard, J. A., & Sheth, J. N. (1969). The theory of buyer behavior. New York: John Wiley and Sons. Hunt, H. K. (1977). CS/D-overview and future research direction. In K. H. Hunt (Ed.), Conceptualization and measurement of consumer satisfaction and dissatisfaction. Cam­ bridge, MA: Marketing Science Institute. Kendall, S. D. (2006). Customer service from the customer’s perspective. In L. Fogli (Ed.), Customer service delivery. Research and best practices. San Francisco, CA: Jossey-Bass. Kotler, P. (2006). Marketing management: Analysis, planning, implementation, and control (12th ed.). Hoboken, NJ: Prentice Hall. Lam, S. Y. (2004). Customer value, satisfaction, loyalty, and switching costs: An illustration from a business-to-business service context. Journal of the Academy of Marketing Sci­ ence, 2004, 32(3): 293–311. Miner, A., & Wain, O. (1994). Customer service. The Dunvegan Quarterly, 2(1). MPO. (2017). https://www.mpo.cz/cz/rozcestnik/ministerstvo/aplikace-zakona-c-106-1999­ sb/informace-zverejnovane-podle-paragrafu-5-odstavec-3-zakona/-iniciativa-prumysl­ 4-0--230485/ National Centre for Industry 4.0. (2018). https://www.ncp40.cz/aktuality/prumysl-40­ to-nejsou-jenom-prumyslovi-roboti-automatizace-vyroby-ci-digitalizace OECD. (2017). OECD Science, Technology and Industry Scoreboard 2017: The Digital

Transformation. Paris: OECD Publishing. https://doi.org/10.1787/9789264268821-en

Oliver, R. L. (1980). A cognitive model of the antecedents and consequences of satisfaction

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Oliver, R. L. (1981). Measurement and evaluation of satisfaction process in retail setting. Journal of Retailing, 57 (Fall): 25–48. Oliver, R. L. (1997). Satisfaction: A Behavioral Perspective on the Consumer. New York: The McGraw-Hill Companies, Inc. Oliver, R. L. (2009). Satisfaction: A behavioral perspective on the consumer (2nd ed.). New York: McGraw Hill. Parasuraman, A., Berry, L. L., & Zeithaml, V. A. (1991). Refinement and reassessment of the SERVQUAL scale. Journal of Retailing, 67(4): 420–450. Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A multiple-item scale for measuring consumer perceptions of service quality. Journal of Retailing, 64(1): 12–40. Peris-Ortiz, M., Álvarez-García, J., & Rueda-Armengot, C. (2015). Achieving competitive advantage through quality management. Cham: Springer, 2015. ISBN 978-3-319-17251-4 Pohludka, M., & Štverková, H. (2019). The best practice of CRM implementation for smalland medium-sized enterprises. Administrative Sciences, 9(1): 22–39. Pynnönen, M., Ritala, P., & Hallikas, J. (2011). The new meaning of customer value: A systemic perspective. Journal of Business Strategy, 32(1): 51–57. Ruiz-Delatorre, A., & Sanchez-Bote, D. (2021). Customer needs in the development of busi­ ness models focused on servitization (Industry 4.0). DYNA, 96(6): 659–665. Shemwell, D. J., Yavas, U., & Bilgin, Z. (1998). Customer service provider relationships: An empirical test of a model of service quality, satisfaction and relationship oriented out­ come. International Journal of Service Industry Management, 9: 155–168. Sheth, J., Newman, B. I., & Gross, B. L. (1991). Consumption values and market choices. Theory and application. Cincinnati, OH: South-Western Publishing Co. Spiteri, J. M., & Dion, P. A. (2004). Customer value, overall satisfaction, end-user loyalty, and market performance in detail intensive industries. Industrial Marketing Management, 33: 675–687. http://dx.doi.org/10.1016/j.indmarman.2004.03.005 Spreng, R. A., Harrell, G. D., & Mackoy, R. D. (1995). Service recovery: Impact on satisfac­ tion and intentions. Journal of Services Marketing, 9(1), 15–23. Spreng, R. A., Hui Shi, L., & Page, T. J. (2009). Service quality and satisfaction in business-to-business services. Journal of Business & Industrial Marketing, 24(8), 537–548. Štverková, H. (2014). Service quality assessment of the mobile operator. In Proceedings of International Conference on Applied Science, Management and Technology 2014 (ICASMT 2014): 4th & 5th December 2014, Corp. Executive Al Khoory Hotel, Dubai, UAE (12–15). Bangalore: Mudranik Technologies. Štverková, H., & Pohludka, M. (2021). Sustainable entrepreneurship in small and mediumsized enterprises in the Czech Republic. In Proceedings of the 14th International Conference Strategic Management and Its Support by Information Systems 2021: May 25–26, 2021, Os­ trava, Czech Republic (s. 303–311). Ostrava: VŠB-Technical University of Ostrava. Teece, D. J. (2010). Business models, business strategy and innovation. Long range plan­ ning. 43, 172–194. Tse, D. K., & Wilton, P. C. (1988). Models of consumer satisfaction: An extension. Journal of Marketing Research, 25 (May): 204–212. Westbrook, R. A., & Reilly, M. D. (1983). Value-percept disparity: An alternative to the disconfirmation of expectations theory of consumer satisfaction. In R. P. Bagozzi & A. M. Tybout (Eds.), Advances in consumer research (10th ed., pp. 256–261). Ann Arbor, MI: Association for Consumer Research.

Quality Management for Assurance Value of the Customer 141 Woodruff, R. B. (1997). Customer value. The next source for competitive advantage. Journal of Academy of Marketing Science, 25(2): 139–153. Yi, Y. (1990). A critical review of consumer satisfaction. In V. A. Zeithaml (Ed.), Review of marketing (pp. 68–123). Chicago, IL: American Marketing Association. Zeithaml, V. A. (1988). Consumer perceptions of price, quality, and value: A means-end model and synthesis of evidence. Journal of Marketing, 52(July): 2–22. Zizka, J. (2018). Roman Holý: Průmysl 4.0 může posílit Evropu i Česko. https://vedavyzkum. cz/blogy-a-rozhovory/rozhovor/roman-holy-prumysl-4–0-muze-posilit-evropu-i-cesko

9

Good Management and Deploying New IT Tools in Industry 4.0 in the ValueCreating Direction Elshan Ahmadov, Esra SİPAHİ DÖNGÜL,

and Shajara Ul-Durar

9.1

Good Management and Technology

In recent years, the purpose of strategies for enterprises has been stated as ensuring that the organization can achieve the desired results in an environment of uncer­ tainty. Strategy allows a business to be opportunistic in line with its purpose (1 cited 2: 70). The key to achieving these goals is to have a leader who sheds light on these uncertainties. One of the most important ways to direct the workforce, which is the most critical element that enables organizations to achieve efficiency and success, is to exhibit effective leadership practices and skills and to motivate employees (3). Transformative leaders, one of the types of leadership far beyond adapting to in­ novation, need the competence to initiate changes/transformations themselves and to have a charismatic effect that will affect the whole team. Transformative leaders are required as a prerequisite to go one step further to have a vision and compre­ hend time with a long-term perspective. In this context, the transformative leader adopts his vision, which is the basis of his strategy, to his employees by providing a high level of motivation by creating an organizational culture (4). 9.2

The Fourth Industrial Revolution

The fourth industrial revolution will bring both great benefits and significant threats against the background of growing inequalities. Production and consump­ tion processes and the habits of society play a unique role here. Being able to adapt quickly to revolutionary changes and adapting to rapidly changing technologies is one of the critical challenges ahead. It can have both positive and negative effects on society. For example, consumers can increase the productivity of their personal lives. We know that with new technology and artificial intelligence development, we can already access many services remotely. Of course, access to remote service saves us a great deal of time and space. Now, simply by using a tablet or a smartphone, we can access and manage our travel, bank accounts, books, movies, and music through the Internet. Sometimes, the smartphone manages our weekly plans through a calendar and directs us on time. We no longer need to spend any extra energy on this. It, of course, dramatically increases our speed of movement and access. The rapidly DOI: 10.4324/9781003404682-9

Good Management and Deploying New IT Tools

143

changing consumer paradigms in our lives will confront us with new challenges. The key here is speed, and those who cannot keep up will be left behind. Keeping up with speed is a form of synchronizing the use of the brain with the tools that speed it up. At first, this may seem not accessible to us; however, if we consider that we travel different distances in a specific time when we walk, on horseback, or go by car or plane. At that time, it can be said that our brain’s thinking and ability to think ahead will also change and be different depending on the tools to which it is connected, because we already live in a world of information, and here informa­ tion is in the status of a product that wears out very quickly. Multiple-byte units are already one of the most important products for us, and perhaps having a plot in GB is becoming a more critical factor for us than buying a plot of land (1). Gigabyte (disambiguation) provides content creators and gamers with a fantastic user expe­ rience, allowing their imagination to manifest a better life. Gigabyte is expanding its business server and cloud business with hardware and software solutions that integrate AI and AloT applications to enable customers to collect, analyze, and transform digital information into economic data, accelerating business (1). On the other hand, the fourth industrial revolution also poses threats. Among the new values is consumer convenience. They get a higher value and more conveni­ ence. At the same time, consumers spend less. Parallel to this, social risks are also increasing. All these values, the speed of information and its storage, the consumer and his behavior, and management with artificial intelligence are the inevitable fun­ damental changes affecting our socio-economic, ecological, and political systems. This is such a process that even if we can prevent globalization, it will not be possible to prevent the aforementioned changes. Such a question may arise here. İf so, how can we turn the fourth industrial revolution to our advantage? In order to answer this question, we must first define the turning points well. To describe the course of the fourth industrial revolution, we need to know the tipping points and the megatrends. What are their driving forces? Some of the tipping points are having unlimited and free (advertising-supported) storage; the population using smartphones; wearing clothes connected to the internet; sensors connected to the internet; transplant of a 3D-printed liver; government replacing its census with big-data sources; and robotic pharmacist. Table 9.1 shows the tipping points expected to occur by 2025 (5). In March 2015, the Global Agenda Council on the Future of Software and Soci­ ety launched the Technological Tipping Points survey (Table 9.1) (5). As for the megatrends, we should consider all new development processes and technologies, especially artificial intelligence. In order to determine the megatrend of the fourth industrial revolution and its main directions, we need to focus on digi­ tal, physical, and biological factors (3). When we say physical, we mean robots, vehicles, and new flying machines. 3D printing transforms the material into the intended three-dimensional object using a digital template (6). These technologies have various applications, from wind turbines to medical implants. However, it is mainly limited to automobiles, transportation, medical, and aviation. Robots, as we know, are already used in all sectors. It includes medicine, construction, agriculture, and the use of machinery (6). Recent developments in sensors increase the sensitivity of robots, which increases the ability to perform various types of

144

Elshan Ahmadov, Esra SİPAHİ DÖNGÜL, and Shajara Ul-Durar

Table 9.1 Average year each tipping point is expected to occur 2018

2021

2022

2023

2024

2025

2026

2027

-Ubiquitous -3D printing -Driverless -Bitcoin Storage Robot -The internet of -Implantable and cars and the for all and and for things technologies Computing -Big data for -3D consumer -AI and blockchain services -Wearable decisions printing products decision­ internet -Vision as the and -AI and making -3D printing and new interface human white- -smart cities manufacturing -Our digital health collar presence -the jobs -Governments connected -the sharing and the home economy blockchain -A supercomputer in your pocket Source: (World Academic Forum, 2015).) https://www3.weforum.org/docs/WEF_GAC15_Technological_ Tipping_Points_report_2015.pdf (5)

tasks (3). When graphene becomes competitively priced, it will cause revolution­ ary changes in the manufacturing and infrastructure sectors. Currently, it is one of the most expensive materials in the world, and the cost of a one-micrometer grain of graphene is more than 1,000 dollars. Internet of Things (IoT) technology has a wide variety of applications, and the use of the Internet of Things is growing so faster (7). Remote monitoring, one of the most common applications of the Internet of Things, can be analyzed. It allows the company to understand where those items are in the supply chain, how they move and how they are used. It also makes it pos­ sible to observe. In the same way, customers can monitor the location of a package or document they are looking for in real time. As a basis for rapid societal change, it would be purposeful to identify the soft­ ware and service megatrends shaping society and the opportunities and risks as­ sociated with them (Figure 9.1). 9.3

Big Data for Decisions

Data are increasing day by day in our daily lives (2). Moore’s law is used to explain exponential developments in the technological field. Moore’s law, which expresses the graphical curve of the doubling of technological developments compared to the previous year (6), is insufficient to explain the increase in the amount of data gener­ ated online over the years, because the increase in the number of users and vehicles connected to digital media, especially in the last decade, naturally increases the amount of data surprisingly (10). 9.4

Implantable Technologies

Every day, we are witnessing how the modern world has changed. In the near future, we will already begin to use new information and communication technologies to

Good Management and Deploying New IT Tools

145

Figure 9.1 The software and service megatrends Source: World Academic Forum (2015) (5)

- Total revenue USD billions - Total UNITS SOLD / billions 160

100 80 60 40 20 0

Total revenue USD billions

120

Total number of units / billions

140

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

Figure 9.2 IDTechEx Research 2016 Source: IDTechEx (2016) (8).

use implantable technologies. Soon they will be worn not only on our body but also inside it. Imagine that there is a foreign electrical device in our body. This is shocking to many, but these technologies will soon become an integral part of our lives. This is our future, with which the current generation will live. For example, in the modern world, we have become inseparable from our phones and computers, which is not good for the future generation. However, it is already possible

146

Elshan Ahmadov, Esra SİPAHİ DÖNGÜL, and Shajara Ul-Durar

Figure 9.3 Wearables shift to new markets and applications Source: IDTechEx (2016) (8). Inspired by IDTechEx, wearables move into new markets and applications in various body parts

to create such useful devices that will be vital for today’s society, for example, an implantable smartphone. This is an incredible breakthrough, because now the smartphone can be carried not only in your pocket but also “inside you.” There are a lot of examples, but in any case, new technologies bring many positive aspects as well as negative ones. In Table 9.2, we have tried to convey some of the positive and negative effects of the new implantable technologies. Innovation is a complex social process with no guarantees. There is a need for more aggressive funding policies aimed at ambitious educational programs by gov­ ernments to support groundbreaking fundamental research and innovative technol­ ogy applications in universities and businesses. In the same way, it is necessary to structure public–private sector cooperation in research to increase knowledge and human capital in a way that can benefit everyone (11).

Good Management and Deploying New IT Tools

147

6,00,000.0 5,00,000.0

500000

4,00,000.0 3,00,000.0 2,00,000.0 100000

1,00,000.0 0.0

1980

1985

10000

1000

10

1

0.2

0.1

0.5

1990

1995

2000

2005

2010

2015

2020

-1,00,000.0 -2,00,000.0

Figure 9.4 Hard drive cost per gigabyte (1980–2009) Source: Schwab (2016) (9)

Table 9.2 Positive, negative, and unknown effects of the new implantable technologies Positive impacts

Negative impacts

Unknown, or cuts both ways

Reduction in missing children Privacy/potential surveillance Longer lives Increased positive health Decreased data security Changing nature of human relationships outcomes Increased self-sufficiency Escapism and addiction Changes in human interactions and relationships Better decision-making Increased distractions (i.e., Real-time identification attention-deficit disorder) Image recognition and Cultural shift (eternal availability of personal data memory) Source: World Academic Forum (2015) (5)

9.5

Emerging Skills

If ten years ago a person mastered one profession once and for all, and few thought about a radical change in occupation, today the transformation of a lawyer into a landscape designer no longer surprises anyone. Also ten years ago, it was hard to imagine that marketers would be expected to have a thorough knowledge of digital technologies and the ability to work with them manually, from IT specialists—the ability to build relationships with people, in general, from everyone—the ability to

148

Elshan Ahmadov, Esra SİPAHİ DÖNGÜL, and Shajara Ul-Durar

Figure 9.5 Technologies likely to be adopted by 2025 (by share of companies surveyed) Source: World Economic Forum (20 October 2020) (12)

speak clearly to the public and make concise and interesting presentations. But the world is changing—and the basic skills for professions are changing. Today, no matter what profession you have, it is not enough to master the necessary highly specialized knowledge once, perfect its application in practice in five years, and then simply build up your reputation. Everything around is rapidly changing: business processes are becoming more complex, the flow of information in any professional environment is growing, and the usual approaches to work and communication between people during work are being replaced by new ones, everything that can be automated is being automated. It is very important to identify those skills that give new opportunities for adaptation to the latest technologies. In Table 9.3, there are skills identified as being in high demand within organization. If earlier it was possible to work according to the same standards for decades, habitually performing the same functions within the framework of their position, now approaches to work can change dramatically more than once a year. Employers now especially appreciate people who easily and without unnecessary sighs adapt to any changes, quickly master new rules, and technologies. Even more valuable are those who are able to notice new useful trends before others and offer to apply them in work, without waiting for such an instruction to come from earlier. The Internet can be explained simply as a connection between objects (products, services, places) and people created by connection technologies and various platforms. Sensors and other myriad tools used to connect objects in the physical world to virtual networks are developing at an astonishing rate. It is expected that

Table 9.3 Selected innovation indicators in Finland by year 1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

Education expenditures (%GNP) Business venture rate (new listing %) Exports in ICT, % Landline and mobile telephony user (per 100 people) ICT in imports, % Landline and mobile telephony user (per 100 people) International internet bandwidth (Mbps) Internet user (per 100 people) Patent application R & D Researcher (per million)

6.97

6.44

5.90

5.69

5.84

5.90

6.09

6.02

6.02

6.02

.

.

.

.

.

.

6.45

6.22

6.59

6.76

.

.

50.23 48.72

44.67 44.48

48.95 42.82

60.24 46.48

67.61 43.89

68.85 54.68

65.59 55.08

69.11 53.99

71.81 57.10

69.62 53.75

73.17 52.38

97.74 .

110.37 .

118.55 129.71

127.07 346.97

134.58 1507.33

139.26 3189.44

140.32 3463.65

140.70 4326.01

140.87 4311.20

143.93 .

147.86 .

.

.

670

1796

7820

16587

18056

22617

22617

.

.

19.46

25.44

32.27

37.23

43.09

48.63

49.11

51.26

53.37

55.55

68.07

2355 5152.50

2471 5906.47

2854 6328.06

2903 6732.68

2660 7109.14

2369 7425.33

2187 7998.24

2220 7838.32

2059 7545.17

2018 7680.87

5152.50

Source: Hobikoğlu, 2009 (13)

Good Management and Deploying New IT Tools

Finland

149

150

Elshan Ahmadov, Esra SİPAHİ DÖNGÜL, and Shajara Ul-Durar

Table 9.4 Top 20 job roles in increasing and decreasing demand across industries 1 Data analysts and scientists

2 Al and machine learning

specialists

3 Big data specialists

4 Digital marketing and strategy specialists 5 Process automation specialists 6 Business development professionals 7 Digital transformation specialists 8 Information technology analysts 9 Software and application developers 10 Internet of things specialists 11 Project managers 12 Business services and administration managers 13 Database and network professionals 14 Robotics engineers 15 Strategic advisors 16 Management and organization analysts 17 FinTech engineers 18 Mechanics and machinery repairers 19 Organizational development specialists 20 Risk-management specialists

1 Data entry clerks 2 Administrative and executive secretaries 3 Accounting, bookkeeping, and payroll clerks 4 Accountants and auditors 5 Assembly and factory workers 6 Business services and administration managers 7 Client information and customer service workers

8 General and operations managers

9 Mechanics and machinery

repairers

10 Material-recording and stock-keeping clerks 11 Financial analysts 12 Postal service clerks 13 Sales Rep., wholesale and manuf., tech, and sci.products 14 Relationship managers 15 Bank tellers and related clerks 16 Door-to-door sales, news, and street vendors 17 Electronics and telecoms installers and repairers 18 Human resources specialists 19 Training and development specialists 20 Construction laborers

Source: World Economic Forum (2020) (12)

the number will increase significantly in the next few years and will be measured not in billions but trillions. On a larger scale, technology platforms are already enabling a demand-side economy (also referred to by some as the sharing economy). Easily accessible on smartphones, these platforms bring people, assets, and data together in one place and create entirely new ways to consume products and services. They are chang­ ing the personal and business environment by reducing the obstacles in the way of wealth-creating companies and individuals (3). Assets previously owned by people who did not consider themselves suppliers are now available for use. These include, for example, space in their car, a free bed in their home, and the time and skills needed to offer services such as retail or manufacturer-to-customer sales, home renovations, or administrative tasks. This makes it possible to use underused assets more efficiently.

Good Management and Deploying New IT Tools

151

Figure 9.6 Perceived barriers to the adoption of new technologies Source: World Economic Forum (2020) (12)

Source: World Economic Forum (2020) (12)

9.6

References



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Business. International Journal of Economic and Administrative Studies] (14). https:// dergipark.org.tr/tr/pub/ulikidince/issue/21614/232156 3. Yeşil, A. (2016). Liderlik ve Motivasyon Teorilerine Yönelik Kavramsal Bir İnceleme. Uluslararası Akademik Yönetim Bilimleri Dergisi [A Conceptual Analysis of Leader­ ship and Motivation Theories. International Journal of Academic Management Sci­ ences], 2 (3), 158–180. https://dergipark.org.tr/tr/pub/yonbil/issue/42550/513236 4. Gürel, P. (2015). İşletmelerde Küresel Rekabet Avantajina Yönelik Yeni Liderlik Tipi: Dönüştürücü Liderlik. Beykent Üniversitesi Sosyal Bilimler Dergisi [A New Type of Leadership for Global Competitive Advantage in Business: Transformational Lead­ ership. Beykent University Journal of Social Sciences], 6 (1), 1–27. Retrieved from https://dergipark.org.tr/tr/pub/bujss/issue/3864/51617 5. World Academic Forum (2015). Global Agenda Council on the Future of Software & Society. Deep Shift Technology Tipping Points and Societal Impact. Survey Report, September. Retrieved from https://www3.weforum.org/docs/WEF_GAC15_ Technological_Tipping_Points_report_2015.pdf 6. Brynjolfsson, E. and A. McAfee. (2014). The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies, Washington, DC: WW. Norton & Company. https://psycnet.apa.org/record/2014-07087-000 7. GeeksforGeeks. (2020). Satyabrata Jena Architecture of Internet of Things (IoT) Architecture of Internet of Things (IoT). Retrieved from https://www.geeksforgeeks. org/architecture-of-internet-of-things-iot/ 8. IDTechEx (2016). Retrieved from http://www.idtechex.com/research/reports/ wearable-technology-2016-2026-000483.asp (accessed on 12.01.2023). 9. Schwab, K. (2016). The Fourth Industrial Revolution. W orld Economic Forum. Retrieved from https://www.weforum.org/about/the-fourth-industrial-revolution­ by-klaus-schwab (accessed on 18.01.2023). 10. Özcan, A. (2021). Büyük Veri: Fırsatlar ve Tehditler. TRT Akademi [Big Data: Opportunities and Threats. TRT Academy], 6 (11), 10–31. doi:10.37679/trta.818569 11. World Academic Forum (1980). Change, Celebration and Competitiveness. Retrieved from https://widgets.weforum.org/history/1980.html/ (accessed on 01.02.2023). 12. World Economic Forum (2020). The Future of Jobs Report 2020, 20 October. Retrieved from https://www.weforum.org/reports/the-future-of-jobs-report-2020/ (accessed on 23.01.2023). 13. Hobikoğlu, E. H. (2009). Yeni Ekonomide İnovasyon Ve Sürdürülebilir Rekabe­ tin Yarattığı Katma Değerin Bilgi Toplumunda Etkisi. Yayınlanmamış Doktora Tezi, İstanbul Üniversitesi [The Effect of Innovation in the New Economy and the Added Value Created by Sustainable Competition in the Information Society. Unpublished PhD Thesis, Istanbul University], p. 267. Retrieved from http://nek.istanbul.edu. tr:4444/ekos/TEZ/44697.pdf

10 The Ideal Quality in Industry 4.0 Model for the Company and Its Meaning in the Client Value Perspective A Systematic Review Farhan Mirza, Shajara Ul-Durar, and

Abdul Jabbar

10.1

Background of the Study

Industry 4.0 reflects the expanding digitalization of industry, which employs modern technology to improve production and service quality. This fourth quality revolution aims to digitize all quality systems and, as a result, enhance current quality practices. In the regulated manufacturing process, innovative industries use cloud-based Quality 4.0 advances. It is used to resolve quality issues as they happen and to perform and employ real-time quality studies to boost competi­ tiveness. Automated root cause analysis, machine-to-machine communication for parameter auto-adjustment, real-time process modeling, and other problems are being taken over by Quality 4.0 technologies. Quality 4.0 is a new approach to quality control. High-performance teams will be able to consistently provide clients with high-quality and high-performance products by integrating digi­ tal technologies with more complex methods and more innovative procedures. Sensors are crucial in increasing the quality of production and service delivery. These can help with security, internal productivity, and long-term operations. This study explains how Quality 4.0 will significantly influence the industry in adding customer value. Eighteen main applications of Quality 4.0 in manufacturing are identified and studied, and several Key Aspects and Enablers of Quality 4.0 for Manufacturing are investigated. Research and development (R&D), manufactur­ ing (M&D), distribution (Distribution), sales (Sales), and service (After-Sales) are all included in Quality 4.0. Industry 4.0 offers clients a new purchasing option with several benefits. It al­ lows clients to order things with any function and any quantity, even if it is only one. Customers may also revise their orders and ideas throughout manufacturing, even at the last minute, without incurring additional costs. On the other side, the benefit of smart products allows customers to learn about the product’s manufac­ turing facts and obtain usage advice based on their habits.

DOI: 10.4324/9781003404682-10

154 10.2

Farhan Mirza, Shajara Ul-Durar, and Abdul Jabbar Need for the Study

Quality 4.0 introduces many strategies for simplifying administrative processes. It is vital to learn more about how Quality 4.0 manufacturing technology may help the industry enhance quality (Javaid et al., 2020). From research and development to production to marketing to customer service to follow-up, Quality 4.0 encompasses the whole supply chain (Maganga & Taifa, 2022). Businesses need to automate digital operations, as well as synchronize and connect these automated processes to other systems and activities, for Quality 4.0 to provide better outcomes. By stream­ lining processes, we can help our most valuable workers and managers get up to speed faster on the latest developments and focus more on expanding their crea­ tive capacities. In a business setting, having senior management behind you will encourage you to do things that will help your company succeed. New technologies allow businesses to compete for quality while keeping their competitive advantage; therefore, they must also design a strategy for continuous organizational growth (Nenadál, 2020). There will be a need for various skills at various levels in the coming revolutions; therefore, being ready for the early is essential. Businesses may use Quality 4.0 to assess their present systems of regulation and identify opportunities for improvement (Yurin et al., 2021). Organizations may use this quality revolution to share successful regulatory practices across depart­ ments and workplaces. Important data analytics will alert businesses to potential enforcement issues, enabling preventive action (Çalık, 2021). Integrating corporate information management with operational technology allows compliance-related processes and data to be streamlined and automated. 10.3

The Objective of the Study

Customer service and the customer experience have the potential to improve. Us­ ing automated track and trace features, for example, you may quickly resolve dif­ ficulties. Additionally, you will have less trouble with product availability, higher quality products, and more options to offer customers. Also known as the “Fourth Industrial Revolution,” the “Industry 4.0” Revolution is now underway. Innovation and a new way of looking at production have been made possible by recent strides in data analytics, collaboration, scalability, and networking technology. Quality 4.0 solutions are available to meet critical concerns, and this quality must be main­ tained at every production stage. Artificial intelligence, machine learning, mas­ sive media, cloud computing, augmented and virtual reality, novel materials, the Internet of Things, and many more fields have all advanced due to this revolution. Many preceding ideas can assist you in achieving this Industry 4.0 advantage, such as improved revenues and decreased expenditures. Industry 4.0 tools also allow for creating products with more value, more significant profit margins, and more unique styles. For instance, by leveraging Industry 4.0 agencies, businesses may provide customized products to clients while they continue applying massproduction techniques. When it comes to achieving quality, the “4.0” in “Quality” refers to the idea of integrating administrative and procedural improvements with

The Ideal Quality in Industry 4.0 Model for the Company 155 technological advances. Using analytics and digital networking streamlines these processes while maintaining a high-quality standard, it employs state-of-the-art networking, data, and computers to enhance conventional development methods (Kubat, 2018). Data collection in real time from a distance is made possible by using intelligent computers. Companies must make choices based on data and find methods to merge data from different processes for greater accuracy and transpar­ ency (Finn, 2019). Connectivity between businesses and operational technologies facilitates the sharing of information and the coordination of activities. Managers can try to capitalize on the transformative power of networking, data, and analysis by using quality management software that focuses on improving the customer experience. The following are the key research aims of this paper: RO1: To identify Quality 4.0 and its main advantages.

RO2: To identify significant Quality 4.0 aspects in the manufacturing industry.

RO3: To identify and discuss quality 4.0 applications to improve business quality.

10.4

Research Methodology

Articles on Quality 4.0 and associated technologies were identified, studied, and published. This chapter discusses an overview of these excellent publications to enhance our effort’s focus. The study summarizes current ideas on the subject and seeks to give a critical judgment based on research. Crucial information on Qual­ ity 4.0 in manufacturing is supplied for a better understanding. This chapter pri­ marily focuses on Quality 4.0 applications in different businesses. This document will assist researchers in identifying new study topics in which to conduct diverse investigations to increase quality. The review looked at 22 papers summarized in Table 10.1. Study the systematic review throughout time in Industry 4.0, which illustrates the importance of quality in Industry 4.0 and its meaning in terms of customer value. 10.5

Quality 4.0

Quality 4.0 uses cutting-edge technology, including artificial intelligence, mobile devices, and transactions, to enhance conventional approaches to reaching the high­ est performance levels in a company. New quality enhancements include smart sen­ sor networks, big data, cloud computing, and apps like augmented reality (AR) and virtual reality (VR) (Bryndin, 2018). Quality teams must take a decisive leadership role in these initiatives. Quality 4.0 is propelled by technology that affects genuine change in quality, leadership, and quality process culture. Quality 4.0 encompasses several developments aimed at improving industrial capabilities. Social network­ ing sites may communicate learning and viewpoints inside and between organiza­ tions (Gadre, 2020). Augmented and virtual reality (AR/VR) systems can enhance human–computer interaction, while artificial intelligence (AI) applications can be

156

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Table 10.1 Industry 4.0 and client’s perspective Publisher Authors and source

Article’s title summary

Years

Emerald

Maganga and Taifa (2022). de Souza et al. (2021). Nascimento et al. (2019). Singh et al. (2019).

2022 2021 2018 2019

Elsevier

Kumar et al. (2021, pp. 896– 910). Ammar et al. (2022). Zhong et al. (2017). FromholdEisebith et al. (2021).

Springer

SaucedoMartínez et al. (2018). Ali and Johl (2022, June).

Quality 4.0 is an updated method of quality management that uses the interconnected and digitalized tools of “Industry 4.0” This article’s goal is to delve into the emerging concept of Total Quality Management 4.0 (TQM 4.0) as a means of adapting quality management (QM) to Industry 4.0 (I4.0), helping to lead organizations into this new phase that has influenced many different fields, including QM and HR This research looks at the feasibility of integrating Industry 4.0’s cutting-edge technological developments with circular economy (CE) principles to produce an enterprise model for the recovery and resale of recyclables and discarded goods. This research aims to produce a technique for determining the index used to evaluate supply chain coordination The best–worst method (BWM) identifies and prioritizes a set of quality metrics crucial to the 4.0 polymer industry using a vector-based multicriteria decision-making process known as the best–worst method (BWM) The article discusses creating advanced quality management systems by integrating software suites, interactive SOPs and training platforms, electronic logs, advanced SPC, and big data analytics The study determines how digital technology can aid in the transition to a circular economy The study thoroughly examines intelligent manufacturing, IoT-enabled manufacturing, and cloud manufacturing. We have highlighted the similarities and contrasts in these issues based on our investigation. This study demonstrates how an industry’s historical roots and surrounding circumstances define and, at times, considerably impede future chances of technology-driven advancement The study aims to systematically examine current achievements using qualitative and segmentation methodologies, revealing trends and areas of opportunity in the industry sense of 4.0 to obtain research gaps that can be implemented in organizational systems along the value chain. This empirical study investigates the impact of digital total quality management (TQM) or Quality 4.0 practices, on long-term performance in Malaysian small and medium-sized enterprises (SMEs)

2021 2021 2017 2017 2021

2018 2021

The Ideal Quality in Industry 4.0 Model for the Company 157 Publisher Authors and source

Article’s title summary

Years

Korea Quan and Science Park (2017).

Where Industry 4.0 technology and quality management concepts cross, the authors see the digital twin enabling smart factories and digital manufacturing processes The researchers discuss facets of Industry 4.0, such as what it implies for customers, businesses, and the industry Rich literature focuses on OSC and Industry 4.0, but the implementation of associated digital technologies in the OSC context has not been thoroughly evaluated This article proposes a conceptual framework based on the literature and a case study of a company implementing a usage-focused service business model in the home appliance market The study looks at how different business sizes, industrial sectors, and the firm’s function as a provider or user of Industry 4.0 affect the importance of opportunities and problems in sustainable Industry 4.0 adoption Industry 4.0, also known as the fourth industrial revolution, is becoming a part of corporate life and significantly impacts the quality of company operations and goods In this research, we combine the digital technologies of Industry 4.0 (I4.0) with the lean manufacturing methods of Six Sigma to eliminate waste and expenses in the face of inadequate supply chain planning by carefully analyzing relevant constructions and multi-structural components (LSCP)

2017

EBR MDPI

Klinc and Turk (2019). Wang et al. (2020). Bressanelli et al. (2018). Müller et al. (2018).

Taylor & Závadská Francis et al. (2018). Reyes et al. (2021).

2019 2020 2018 2018

2018 2021

utilized to cultivate new skills. Learning management, augmented and virtual real­ ity systems, and wearable tech may make training more effective, and intelligent technology can help with employee evaluations (Quan, 2017). Quality 4.0 illustrates the direction that providers might follow toward future technologies. Market efficiency may be improved and maintained through deep learning, statistical analysis, the Internet of Things, big data, cloud analytics, and more conventional quality control techniques. Through digital technology, more innovative policies, and procedures may assist boost consistency in a variety of ways (Klinc & Turk, 2019). Monitoring and collecting data in real time and analyz­ ing are examples of what businesses may do to foresee quality concerns and main­ tenance requirements. Digital instruments may make work more efficient, more accessible, and less expensive. “Quality 4.0” means the next generation of quality and organizational excellence in Industry 4.0. It is becoming increasingly important to consider the digitization

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of quality infrastructure, processes, and people. Quality 4.0 can be used in place of conventional quality control methods to enhance existing processes greatly. Using the Quality 4.0 framework, manufacturers may assess where they are in terms of quality now and where they need to go to improve. It makes it easier for upperlevel management to deal with various challenges. To fully benefit from Quality 4.0, businesses must develop an analytical strategy (Wang et al., 2020). Low-cost embedded sensors in Industry 4.0 revolutionize the connection by providing near real-time input to connected persons, commodities, edge devices, and processes. Smart sensors and wearable gadgets that can detect humans and their surroundings may be used by people close to one another. Connected products can provide reliable success assessments throughout their useful lives and link crucial equipment to wired edge computers. In addition, edge sensors examine the setup, come to diagnostic and prognostic conclusions, and streamline the decision-making process on a global scale. Quality 4.0’s connectiv­ ity function provides access to transparent data and rigorous analysis. As a signifi­ cant source of innovation and quality assurance, connectivity, data, and research have undergone substantial changes and expansion. Global manufacturing, pro­ cessing, and production markets are undergoing a fundamental upheaval due to digital transformation (Milward et al., 2019). In addition, Quality 4.0 will enhance the present inspection’s function. Since automated equipment put in machines and industrial lines quantifies the tasks performed. It will be crucial in determin­ ing measuring methods, analyzing obtained data, and implementing preventative measures to improve existing operations. Modern technologies and established quality management practices are brought together in Quality 4.0 to achieve un­ precedented levels of efficiency, competitive advantage, and creative thinking. Businesses have established a comprehensive plan and execution program to take advantage of the opportunities presented by Quality 4.0. The findings high­ light the urgency for enterprises to speed up their implementation of Quality 4.0 (Tortorella et al., 2021). A multifaceted approach that addresses strategic, cultural, and technological issues is critical to success. Survey participants recognize the relevance of Quality 4.0 at all supply chain stages. They do, however, see enhanced efficiency in manufacturing and R&D as beneficial (Javaid & Haleem, 2019). Value creation is reflected in the importance of development since it is more evident on the shop floor. After today’s training, attendees will be able to articulate better the benefits of applying Quality 4.0 in science and technology to improve product de­ sign and quality. The industry relies on using intelligent technology in its systems and processes to create large amounts of available capacity (Fonseca, 2018). 10.6

Importance of Quality 4.0

As quality becomes more important on the corporate agenda, new ways to quality control are becoming accessible (Shayganmehr et al., 2021). Improvements in digi­ tal plant structures and processes enhance efficiency and flexibility in the factory and the supply chain. In only one way, Quality 4.0 prepares the road for emerging sectors. The use of digital technology may help improve quality in several different

The Ideal Quality in Industry 4.0 Model for the Company 159 ways. People may use online platforms to execute their tasks faster, smarter, and cheaper (Velásquez et al., 2019). Wired connections are ideal for high-performance, time-critical automated tasks. Environmental factors are frequently tracked, and their significant impact on quality changes can be identified. The urgent desire for more process visibility exemplifies IoT’s enormous ability for proactive quality management. A quality management plan may help producers address a wide range of quality concerns and improve their products (Oliff & Liu, 2017). The benefits of using quality 4.0 in science and technology to enhance the development and quality of new goods have been clarified to the participants. Intelligent systems are being implemented into manufacturing infrastructure and procedures to boost output. Continual sensor inputs allow the system to respond autonomously to unforeseen changes, such as weather. Using leverage, both small and large manufacturing and supply chain businesses can proliferate. Quality 4.0 is the digitalization and integration of design and production processes. They also want a framework that can grow with their staff and products during the quality compliance phase (Kliestik et al., 2020). Today’s medical device makers rely on multinational supply chains that include design partners, consultants, and layers of suppliers to expedite manufacturing and market introduction. Businesses use emerging technologies to boost product functionality and conform to regulatory quality enforcement goals. Emerging technologies such as IoT and robotics will enhance patient outcomes globally, resulting in higher quality healthcare in the medical industry. The advancement of Quality 4.0 has aided in the advancement of technology and techniques to increase compliance (Massaro et al., 2021). It is critical in today’s society to link dynamic product manufacturing and quality procedures. IoT installations are also disproportionately tricky and expensive, with data gathering inherent in most industrial contexts. In truth, it all boils down to picking the most outstanding technology for the ideal company environment. It got more peripheral for automation with the emergence of current IoT technologies (Závadská & Závadský, 2020). 10.7

Key Elements of Quality 4.0 in Manufacturing/Production Development

As shown in Figure 10.1, several studies have shed light on the various qualitative facets of implementing a Quality 4.0 culture throughout the manufacturing setting. The essential features are cloud-based data storage, process and system automation, and technically sophisticated supports like artificial intelligence, sensor technology, and virtual reality add-ons. These characteristics aid in the manufacturing sector’s rapid growth and processing and the satisfaction of the sector’s end users (Carolis et al., 2017). Quality 4.0 is a system for overseeing and bettering the new and existing quality settings. Using digital data, analytics, convergence, and scalability as its driving forces, Quality 4.0 seeks to provide new ways to link people, machines, and information. These innovations combine analytics, material sciences, and game-changing communication capabilities. These innovations pave the way for a smooth

160

Farhan Mirza, Shajara Ul-Durar, and Abdul Jabbar

Figure 10.1 Elements of Quality 4.0 for Manufacturing Development

transformation in all aspects of society, from leadership and collaboration to the industrial sector. The global proliferation of data, users, devices, and applications is a challenge that Quality 4.0 is up to the meeting. Harmonization, simplification, and optimization processes are required to allow high-quality individuals to go from quality to innovation and improvement (Haleem & Javaid, 2019). Businesses can analyze existing enforcement processes and procedures to spot areas for qual­ ity improvement. Impossible as it may seem, fostering a positive company culture is essential to the success of any business. Quality 4.0, on the other hand, has the potential to increase channels of interaction, awareness, and understanding, as well as boost teamwork. Performance teams will need to refocus their efforts to achieve the strategic goals of corporate buy-in and incubator ownership. Computer train­ ing, artificial intelligence, and machine applications may all benefit from the use of wearables, AR, and robots in the classroom. Quality 4.0 technology is essential for effectiveness as it facilitates management, cooperation, and regulation (Silva & Barriga, 2019). Quality 4.0 to the economy’s future cannot be overstated. Consistency is critical in any process, from research and design to customer service. Rather than a means of prevention in today’s fast-paced environment, Quality 4.0 is more of a strategy of confinement based on the principle of consistency (Gupta et al., 2021). Quality 4.0 is captivating, and some of its ideas will undoubtedly be included in future high-quality goods. The foundation of this quality movement is an agreed-upon approach to qual­ ity. Quality 4.0, on the other hand, has the potential to increase channels of interac­ tion, awareness, and understanding, as well as boost teamwork. Performance teams will need to refocus their efforts to achieve the strategic goals of corporate buy-in and incubator ownership. Computer training, artificial intelligence, and machine ap­ plications may all benefit from the use of wearables, AR, and robots in the class­ room. Adopting Quality 4.0 technology is vital for productivity since it facilitates

The Ideal Quality in Industry 4.0 Model for the Company 161 management, cooperation, and control. Responsible for making sure quality is al­ ways a top concern during manufacturing. Its secondary goal is to improve quality oversight throughout the company by customers and suppliers (Plumpton, 2019). 10.8

Quality 4.0 to Enhance Business

Quality 4.0 technical breakthroughs include enhanced analytics, manufacturing, and engineering, which enable businesses to achieve real-time management of essential quality parameters such as internal engineering, production efficiency, provisioning performance, and customer support (Glogovac et al., 2022). Data were frequently the primary driver of change in efficiency to increase quality. Most firms, however, postpone data collection, analysis, and decision-making (Yadav et al., 2021). Fur­ thermore, the rapid, dependable collection of data from different sources enables informed, agile decision-making, which is an essential component of Quality 4.0. Li et al. (2020) demonstrates that the current quality metrics on various ongoing aspects provide insight into what has occurred. The present descriptive/diagnostic/ predictive paradigm is enhanced using Quality 4.0 technologies like big data, computer-based training, and artificial intelligence. Foreseeing failure and alerting the procedures needed to improve results are made possible by prescriptive analyses made possible by machine learning and artificial intelligence. Quality 4.0 enhances the connection between IT and OT (Neal et al., 2021). In this sense, information technology (IT) refers to tools like quality management systems, ERPs, and PLMs used by businesses. The term “operational technology” (OT) is commonly used to describe machinery found in industrial, laboratory, and service settings (Ramezani & Jassbi, 2020). Low-cost sensors might facilitate the interconnection of people, goods, and edge infrastructure by analyzing at the edge rather than in the cloud. Collecting data in real time will enhance business operations, made possible by the network. Quality 4.0 is sometimes called an automation revolution involving increased efficiency, remarkable performance, and attention to detail. The Quality 4.0 revolu­ tion is not restricted to industries; it also favors the social and economic atmosphere and allows processes to contribute to industrialization; nevertheless, extensive test­ ing and quality assurance are required for maximum performance. As a result, the only way to reap the most considerable benefits from Quality 4.0 is to implement quality performance solutions, which include increased efficiency, increased prof­ itability, and less risk (Shao et al., 2021). Big data will be used for quality control to ensure that manufactured goods are of the highest standard. Using data intelligence and computational services can drastically reduce the number of tests manufacturers must do to ensure the desired uniformity. Production data and historical test results and data may be analyzed to develop fully autonomous AI-driven testing procedures. With the help of machine learning, manufacturers can reliably foresee their products’ consistency up until the point of final testing. Quality 4.0 also does not work with the internal processes, standards, exper­ tise, and experience gained by a company with limited international reach. Cloud computing is essential not only for data storage but also for rapid expansion.

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Organizations can execute centralized processes, thanks to the availability of high-quality technology. The ability to shift attention from output quality to in­ novation is one of the main benefits of quality experts’ process and system inte­ gration. There are several opportunities for automated enforcement in the Quality 4.0 world. Providers of infrastructure also provide systems and validation tools that are incredibly adaptable, integrated, and networked. Organizations can learn how to better enforce their own rules and processes by looking within. To com­ bat this issue, Quality 4.0 promotes a high-functioning community through bet­ ter information-sharing channels and teamwork; quality tools should adjust their focus to fit more closely with organizational goals. Quality leaders, including executives, should promote and lead quality to foster and reward ownership at all levels of the business. 10.9

Future of Quality 4.0

In the future, Quality 4.0 will help improve workers’ foundational skills and ca­ pacity to acquire new ones. Support for training and capacity building should come from various sources, including social media, machine learning, AI, hy­ brid software, wearables, and virtual reality. Cyber-physical systems in intelli­ gent manufacturing will allow for human and machine communication through wide-area networks like the Internet of Things. Physical structures, digital rep­ resentations, and distributed decision-making will all fall within their purview. Many companies need a platform upgrade in their supply chain and quality con­ trol activities to achieve Quality 4.0. Investments in technology will be used for things like replacing old machinery, implementing new sensors, utilizing AI and ML, and establishing enterprise-wide infrastructure to accommodate a growing demand for services. Internal and external Internet of Things (IoT) data will rise exponentially in the near future, and Quality 4.0 will translate these data into actionable insights. For Quality 4.0 projects to be successful, a culture shift will need to occur, resulting in higher costs associated with training new employees and implementing other forms of change management. It is imperative that all staff, including the quality team, participate in the shift to the new Quality 4.0 paradigm and get appropriate training. Top management must regularly exhibit and implement the new corporate philoso­ phy and cultural vision. There will be additional long-term benefits to participating in Quality 4.0. This upheaval will usher in the future of quality in pursuing absolute excellence. Using quality standards and pointing out the link between high-quality work and doing well during times of change would suit their businesses. 10.10

Conclusion

Managing all areas of the industry requires a focus on quality as defined by the 4.0 paradigm. It is essential to characterize the finished items, the changeable de­ mand from clients, the costly materials, and the manufacturing expenses to boost efficiency and decrease rejection. In the Internet of Things age, quality assurance

The Ideal Quality in Industry 4.0 Model for the Company 163 has emerged as a game-changing sector of the industrial sector. Quality 4.0 tech­ nologies are necessary for successful quality management, which must constantly monitor and regulate various systems and process factors that affect final product quality. A culture in which all employees are held accountable for quality and open­ ness can only be fostered with the help of the technologies used throughout this shift. The impact of organizational culture and management style on Quality 4.0 adoption can only be fully understood by studying a wide range of organizations. Recently developed low-priced sensors, improved data-gathering methods, and fast communication networks in cyber-physical systems have led to the widespread use of quality control systems. As a result of the information provided by big data, manufacturers would be able to meet customer expectations better. Quality 4.0 is most notable for its efforts to preserve product quality throughout its entire lifecy­ cle. Artificial intelligence can efficiently monitor service levels by obtaining and evaluating product usage data. Helping upper management in a clear, easy-to-reach way could improve how customers see Quality 4.0. 10.11

References

Ali, K., & Johl, S. K. (2022). Impact of total quality management on SMEs sustainable per­ formance in the context of industry 4.0. In Proceedings of International Conference on Emerging Technologies and Intelligent Systems: ICETIS 2021 (Volume 1) (pp. 608–620). Springer International Publishing. Ammar, M., Haleem, A., Javaid, M., Bahl, S., & Verma, A. S. (2022). Implementing In­ dustry 4.0 technologies in self-healing materials and digitally managing the quality of manufacturing. Materials Today: Proceedings, 52, 2285–2294. Bressanelli, G., Adrodegari, F., Perona, M., & Saccani, N. (2018). Exploring how usagefocused business models enable circular economy through digital technologies. Sustain­ ability, 10(3), 639. Bryndin, E. (2018). Directions of development of Industry 4.0, digital technology and social economy. American Journal of Information Science and Technology, 2(1), 9–17. Çalık, A. (2021). A novel Pythagorean fuzzy AHP and fuzzy TOPSIS methodology for green supplier selection in the Industry 4.0 era. Soft Computing, 25(3), 2253–2265. Carolis, A. D., Macchi, M., Negri, E., & Terzi, S. (2017, September). A maturity model for assessing the digital readiness of manufacturing companies. In IFIP International Con­ ference on Advances in Production Management Systems (pp. 13–20). Springer, Cham. de Souza, F. F., Corsi, A., Pagani, R. N., Balbinotti, G., & Kovaleski, J. L. (2021). Total qual­ ity management 4.0: Adapting quality management to Industry 4.0. The TQM Journal, 34(4), 749–769. Fromhold-Eisebith, M., Marschall, P., Peters, R., & Thomes, P. (2021). Torn between digi­ tized future and context dependent past–How implementing ‘Industry 4.0’production technologies could transform the German textile industry. Technological Forecasting and Social Change, 166, 120620. Finn, S. (2019). The missing link in quality 4.0: Building the business case for executive buy-in and company engagement. Quality, 58(13), 37–39. Fonseca, L. M. (2018, May). Industry 4.0 and the digital society: Concepts, dimensions and envisioned benefits. In Proceedings of the International Conference on Business Excel­ lence (Vol. 12, No. 1, pp. 386–397).

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The Ideal Quality in Industry 4.0 Model for the Company 165 Nenadál, J. (2020). The new EFQM model: What is really new and could be considered as a suitable tool with respect to quality 4.0 concept? Quality Innovation Prosperity, 24(1), 17–28. Oliff, H., & Liu, Y. (2017). Towards Industry 4.0 utilizing data-mining techniques: A case study on quality improvement. Procedia CIRP, 63, 167–172. Plumpton, D. (2019). Cyber-physical systems, internet of things, and big data in Industry 4.0: Digital manufacturing technologies, business process optimization, and sustainable organ­ izational performance. Economics, Management and Financial Markets, 14(3), 23–29. Quan, Y., & Park, S. (2017). Review on the application of Industry 4.0 digital twin technol­ ogy to the quality management. Journal of the Korean Society for Quality Management, 45(4), 601–610. Ramezani, J., & Jassbi, J. (2020). Quality 4.0 in action: Smart hybrid fault diagnosis system in plaster production. Processes, 8(6), 634. Reyes, J., Mula, J., & Díaz-Madroñero, M. (2021). Development of a conceptual model for lean supply chain planning in industry 4.0: multidimensional analysis for operations management. Production Planning & Control, 1–16. Saucedo-Martínez, J. A., Pérez-Lara, M., Marmolejo-Saucedo, J. A., Salais-Fierro, T. E., & Vasant, P. (2018). Industry 4.0 framework for management and operations: A re­ view. Journal of Ambient Intelligence and Humanized Computing, 9, 789–801. Shao, X. F., Liu, W., Li, Y., Chaudhry, H. R., & Yue, X. G. (2021). Multistage implementa­ tion framework for smart supply chain management under Industry 4.0. Technological Forecasting and Social Change, 162, 120354. Shayganmehr, M., Kumar, A., Garza-Reyes, J. A., & Moktadir, M. A. (2021). Industry 4.0 enablers for a cleaner production and circular economy within the context of business ethics: A study in a developing country. Journal of Cleaner Production, 281, 125280. Silva, F. L. D., & Barriga, G. D. C. (2019, July). “Industry 4.0” digital strategy, and the challenges for adoption the technologies led by cyber-physical systems. In International Joint Conference on Industrial Engineering and Operations Management (pp. 463–472). Springer, Cham. Singh, R. K., Kumar, P., & Chand, M. (2019). Evaluation of supply chain coordination index in context to Industry 4.0 environment. Benchmarking: An International Journal, 28(5), 1622–1637. Tortorella, G., Miorando, R., Caiado, R., Nascimento, D., & Portioli Staudacher, A. (2021). The mediating effect of employees’ involvement on the relationship between Industry 4.0 and operational performance improvement. Total Quality Management & Business Excellence, 32(1–2), 119–133. Velásquez, N., Estevez, E., & Pesado, P. (2019, April). Methodological framework based on digital technologies for the implementation of Industry 4.0 in SMEs. In 2019 Sixth Inter­ national Conference on eDemocracy & eGovernment (ICEDEG) (pp. 371–374). IEEE. Wang, M., Wang, C. C., Sepasgozar, S., & Zlatanova, S. (2020). A systematic review of digital technology adoption in off-site construction: Current status and future direction towards Industry 4.0. Buildings, 10(11), 204. Yadav, N., Shankar, R., & Singh, S. P. (2021). Critical success factors for lean six Sigma in quality 4.0. International Journal of Quality and Service Sciences, 13(1), 123–156. Yurin, D., Deniskina, A., Boytsov, B., & Karpovich, M. (2021). Quality 4.0. Time of revo­ lutionary changes in the QMS. In E3S web of conferences (Vol. 244, p. 11010). EDP Sciences.

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11 Quality and Value Management in Education in the Digitalization Era Shashi Kant Gupta and Joanna Rosak-Szyrocka

11.1

Introduction

Computers are now everywhere and have drastically altered people’s lives. The world of education might be drastically altered by computers and the internet. The ways we study, communicate, conduct politics, and engage in most facets of human connection have all been altered by computers and the internet (Catal & Tekinerdogan, 2019). The goal of the contemporary educational system is to use instructional methods that are up to date with technological advancements. Urban and rural equality, curriculum sharing, and resource sharing have all improved as a result of the online education effort. In the “post-epidemic era,” it is also a ben­ efit and value of the growth of digital education. To provide top-notch courses from renowned universities and professors to all students throughout the pandemic, several areas have established air classrooms and online classes. In conjunction with the online programs offered by colleges, students may readily get free, highquality courses online throughout the whole nation (Rosak-Szyrocka, 2023). The supplementary advantages of educational services have undermined the monopoly of top-notch resources held by prestigious colleges and educational institutions and significantly supported the advancement of educational equality. Many children from low-income homes are now able to access information and expertise that they previously found difficult to get via the use of video transmission, courseware distribution, case sharing, and other techniques (Hidayat et al., 2022). The profes­ sional growth of teachers in low-quality colleges has also profited greatly at the same time. Many educators post their assessments on online sites. The professional interchange and growth of the teacher group are substantially aided by the learning that occurs between teachers from various areas, colleges, and subjects (Dobudko et al., 2019). While the majority of research on digital abilities has concentrated on individual actors (teachers, students, and college leaders), a growing but some­ times underappreciated area of study analyzes college-level competencies in the context of promoting digitalization and educational transformation (Aini et al., 2020). Several colleges are organizing advisory committee meetings to represent the necessary knowledge of the educational environment required by the creative companies to provide a relevant education. Currently, raising educational standards

DOI: 10.4324/9781003404682-11

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is the primary objective of educational sector growth. By addressing issues like content optimization and developing specific educational standards, it may be put into practice. Events that are often performed online and are easily accessible to suit educa­ tional demands serve as examples of information technology advancements in the 4.0 age. Assessment plays a crucial role in education. It should be kept in mind that the effectiveness of educational programs is not the key factor in an assessment’s impact on learning; rather, it is the assessment itself. The quality of the assign­ ment, the score report, the evaluation, the feedback, the programs, the criteria, and the policies are all included in the assessment. Presently, college administrators must promote advancement and digitalization (Abdushoripovna & Abdinazarovna, 2022), beginning with students, teachers, and higher education institutions. So, according to college administrators, technological accessibility is a complex and emerging problem. Information concerning the assessment is not digitalized and is still of poor quality. Figure 11.1 serves as both a list of reports and a basic explanation of how to re­ ceive an evaluation from beginning to end for this information system. Beginning with the data collection for the exam schedule on the online attendance database (AO), which is then synchronized by the Administrative Lecturer and given to the Supervisor to take attendance during the exam, proceed to the submission of at­ tendance from the Supervisor to the Administration Lecturer again to record the students present during the exam. The student eventually receives a message about the amount once the lecturer uses the attendance to enter grades. On college bulle­ tin boards, grades are still being announced. The development (Lin, 2022) of online communication technologies (CT) improved communication between students and professors in the context of higher education throughout the digital transformation.

Figure 11.1 A typical assessment system’s activity diagram

Quality and Value Management in Education 169 As a result of digitalization, innovation is made possible via a radical openness that fosters the digital transition. In the age of digital transformation, the development of online CT helped to increase communication between students and professors in the context of higher education. The loss of universities’ academic independence, the enormous complexity of the regulatory paperwork, and the management requirements that result in a time loss for the teaching staff throughout the execution process are some of the negative elements. The creation of projects with a practical application has influenced stu­ dents’ motivation to address certain educational issues to raise educational stand­ ards. A non-traditional, creative approach to the development projects to address educational challenges was made possible by the gradual growth of student project activities. We provide a swarm-optimized bagging C4.5 (SOBC) technique to de­ tect the student’s effective performance. 11.2

Problem Statement

In the field of education, the quality management function is restricted to support­ ing activities like “issue identification and solutions,” “new business models,” and “increasing automation.” There are not many projects in this area, which suggests that quality management plays a very little role. These efforts are implemented at the company level, where responsibilities and value chains are shifting, which is the cause of this. The decline of group learning, which lowers the educational and developmental potential of education, the weak development of the creative activ­ ity, the reduction of the teacher’s direct influence, the impossibility of the teacher’s emotional and intellectual impact on the student, and the pedagogical shortcomings are just a few of the drawbacks of digital technologies or distance learning. The set of educational quality indicators and the criteria that go along with them assist colleges in highlighting the key components of their operations, including their benefits and drawbacks as well as future growth chances. 11.3

Proposed Work

All operations and tasks should be managed according to quality standards in order to maintain the appropriate level of excellence. Quality management encompasses developing and implementing a quality strategy, coming up with and implement­ ing quality assurance and planning, as well as quality control and improvement. The goal of quality management is to achieve quality objectives through plan­ ning, monitoring, ensuring, and enhancing quality. Figure 11.2 shows our proposed methodology. 11.3.1

Dataset Collection

The study was carried out at a private higher education institution in Oman, and the dataset included 772 instances of students enrolled in the sixth semester. Ecommerce (COMP 1008) and e-commerce technology were the modules selected

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Figure 11.2 Representation of our proposed methodology

(COMP 0382). These modules were chosen because they are offered in a variety of disciplines, share the same course material, and produce the greatest number of students needed to create the dataset. Any study project needs ethical permission before it can begin collecting data. To secure the applicants’ informed consent for this study, the goal of the study and its description were explained to them. While utilizing eDify, there were “no potential dangers” or discomfort, but if the candi­ date ever experienced discomfort or risk, they were free to leave the research at any time. All data from the study were coded to protect applicant names to preserve confidentiality and privacy. While discussing or reporting statistics, no names or other personally identifiable information was utilized. The data were erased once they had been thoroughly examined. It was made clear to the students at the begin­ ning of the semester that participation in the research was entirely voluntary and that the applicant kept the right to do so at any moment. The information was gath­ ered from the Spring 2019 and Fall 2019 semesters following the rollout of the mo­ bile application eDify that supports video-based learning (VBL) and by recording

Quality and Value Management in Education 171 student video interactions. The module employed eight lecture films, although the data from all eight lecture videos were used for the study. 11.3.2

Preprocessing Using Normalization

Datasets can be normalized using a variety of techniques, such as min-max normal­ ization, z-score normalization, decimal scaling, standardized moment, etc. The two most often-used and favored normalization techniques are min-max and z-score normalizations. The min-max strategy was employed for our task. For min-max normalization, the following equation is used to normalize fea­ tures in the [0, 1] range: v¢ =

v ­ min p max p ­ min p

(1)

Here, feature P’s minimal and maximal values are represented by min p and max p. The attribute’s original and normalized values are represented by the values v and v’, respectively. As can be seen from the previous equation, the maximum and minimum feature values are converted into 1 and 0, respectively. 11.3.3

Feature Extraction Using Linear Discriminant Analysis (LDA)

Predictive models used for classifying patterns first use the dimensionality reduc­ tion technique known as LDA. LDA’s primary task is to look for any vectors in the vector space that can better separate the different classes of input. The original data points may be projected onto these vectors to assess the class separability (s). Therefore, LDA seeks to better differentiate the classes if they overlap for a given set of data points by using some kind of modification method. By attempting to maximize the fisher ratio, which is defined as follows, LDA uses a rule known as the Fisher ratio to achieve this goal:

( m1 ­ m 2 )

2

s 12 + s 22

(2)

where σ1 indicates the first class’s variation and σ2 represents the second class’s variation. ( m1 ­ m 2 ) indicates the difference between the means or center points of the two classes or distributions. As a result, LDA aims to maximize the Fisher ratio or the dispersion between the two classes, to increase the distance between the two classes. HP while attempting to minimize the difference between the two classes to make them as compact as feasible s 12 + s 22. It makes an effort to minimize withinclass dispersal HM. Consequently, the formula for the fisher ratio in (2) is as follows: HP HM

(3)

Shashi Kant Gupta and Joanna Rosak-Szyrocka

172

Therefore, by translating our data into a reduced dimensional space, our goal is to maximize (3). We need a transformation matrix ω to accomplish this goal. H P = mD H P m

(4)

H M = mD H M m

(5)

Hence, equation (3) becomes mD H P m mD H M m

(6)

HP can be expressed as follows: The last step is to identify a transformation matrix w that maximizes (5). The w matrix is evaluated using the LDA model by computing the eigen­ vectors of H M-1 H P . As a result, LDA transforms data with b dimensions into x dimensions using the transformation matrix, where x ≤ (G – 1) where G is the dataset’s class count. If binary categorization is used = 1, hence, x = 1, with the student or health class. LDA guarantees that the maximum is maximized throughout the transformation via w. (2) LDA comes with two benefits. The original feature vectors are transformed or pro­ jected onto a smaller vector space, where the class separability is increased, which strengthens the prediction model in the first place. Second, the predictive model’s temporal complexity is dramatically lowered. Data are converted, then dimension­ ality is reduced using LDA and then used in a neural network for classification. 11.3.4

Classification Using Swarm-Optimized Bagging C4.5 Algorithm

PSO is built on a horde of particles, or n people, each of whom represents a solu­ tion to an N-dimensional issue. Its genotype consists of two parameters: one that encodes the coordinates of the particle position, and the other that does the same for the velocity components in the N-dimensional problem space. According to the theory of evolution, a particle moves at a variable speed inside the search area and memorizes the highest position. When moving from one iteration to the next, the parameters are modified as follows: Velocity uj(d + 1) of the jth particle at time t, the positional difference between them pj(d) of the most effective resolution discovered thus far by the jth particle and present location qj the difference between the best position ever discovered in the population and the jth particle pc(d) and that of jth particle bj(d):

Quality and Value Management in Education 173 u j ( d +1) = m.u j ( d ) + g1 .V ( 0,1) Ä ( p j ( d ) ­ q j ( d ) ) + g 2 .V ( 0,1) Ä

( p ( d ) ­ q ( d )) c

(7)

j

Ä represents point-wise vector multiplication. V(0, 1) is a function that generates a vector with uniformly random positions in the range [0, 1]. The cognitive parameter is g1, the social parameter is g2, and the inertia factor is w, with a range of [0.0, 1]. .0]. The range of velocity values must be contained by two parameters umin and umax. In contrast to the original PSO, when it is executed, w is not maintained con­ stant; instead, beginning with a maximum value ωmax, as the number of iterations grows, it decreases linearly until it reaches a minimum value ωmin. m ( d ) = mmax ­ ( mmax ­ mmin ) .

d Dmax

(8)

where d and Dmax, respectively, are the current and allowable number of iterations. The product of the particle’s current position and the velocity provided by equation (7) is then used to determine where each particle will be in the following step: q j ( d +1) = q j ( d ) +u j ( d +1)

(9)

Dmax Repetitions of these procedures are performed, or until a different halting con­ dition is established. A common “convergence criterion” consists of achieving a minimum desirable degree of error about the optimum solution.

Algorithm 1: PSO algorithm Start

For each component

Set the initial particle position and speed.

While (maximal number of iterations is not reached) do

For each component

Determine the fitness value y j ( d ) If y j ( d ) is better than best fitness value y j ( p j ( d ) ) in particle history Then y j ( p j ( d ) ) = y j ( d ) and take the current particle as new pj During execution, if necessary, update the global best particle pc(d) For each component Based on Eq. (1), calculate the particle velocity Based on Eq. (3), update the particle position According to Eq. (2), update the inertia factor Terminate

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The oldest and most straightforward ensemble-based method is bagging, but it is also the most efficient. To improve the poor classification results, it mixes many sets of classifier models. Bagging uses comparatively few datasets to counteract the instability of complicated models. A bagging version called pasting tiny votes is used to handle huge datasets by breaking them up into smaller chunks. These seg­ ments are trained to create separate classifiers using a technique called bites, which is then combined with a majority vote. Working ensemble bagging algorithm. • The sequence of the training sample (k1 : o1 ). . . (xn : yn) with the label o Î 0 = ( ­1,1) . 1 • Set each instance’s probability in the learning set to its initial value. T1 ( j ) = l and d=1. • During the iteration process, d < P = 100 is a participant in the group. The train­ ing is done using n sets and replacement sampling, with t being the value of the Td distribution. • Establish a hypothesis sd : K O • Set d=d +1 • Terminate the loop • The whole set of hypotheses G* ( k j ) = s final ( k1 ) = argmax å d=1 J ( Gd ( k ) = 0 ) p

(10)

The decision tree method is the main classifier model that employs a tree graph or hierarchical structure. The fundamental idea of a decision tree is that data are turned into a rooted-tree graph as the decision rules. The stages for building a deci­ sion tree with the C4.5 algorithm are as follows: • It is crucial to prepare training data that have been divided up into distinct classes (like stable and unstable classes). • By calculating the largest gain value of each characteristic, the root of a tree is identified. In G, the entropy of the class’s property k is calculated using (11): Entropy ( k ) = ­å gÎG q ( g | k ) .log q ( g | k )

(11)

• The gain value is determined by (12): Gain ( k ) = Entropy ( k ) ­ å j

L (k j ) L (k )

. Entropy ( k j )

(12)

• Knowing the split information utilizing is required before we can compute the gain ratio (13): Split in formation ( k ) = ­ å j

L (k j )

æ L (k j ) ö ÷ . log 2 ç ç L (k ) ÷ L (k ) è ø

(13)

Quality and Value Management in Education 175 • The gain ratio may then be determined using (14): GainRatio ( G,k ) =

Gain ( g,k )

Splitin formation ( g,k )

(14)

When all records have been partitioned, repeat step 2. If the following conditions are met: (i) all record pairs in node n belong to the same class; (ii) A record no longer possesses any partitionable properties, and (iii) the empty branch is empty of records, and the partition operation will be terminated. 11.4

Result and Discussion

In the digitalization Era 4.0, effective graduate quality management is required in educational institutions due to the importance of life skills being emphasized in education, as can be seen from the aforementioned term. In this section, we have compared some of the existing methods with our proposed method to evaluate the student’s performance in post 4.0. Here, the existing methods are decision tree al­ gorithm (DTA) (Li 2022a), C4.5 decision tree algorithm (Wang 2022), AdaBoostSVM (Zhang et al. 2022), joint neural network (JNN) (Li 2022b), and our proposed method is classification using swarm-optimized bagging c4.5 algorithm (SOBC). Total quality management (TQM) focuses on giving the students what they want, when, and how they want it. To design goods and services that both meet and exceed the demands of today’s students, one must adapt to shifting fashions and expectations among them. Students won’t return and spread the word about it to their friends unless you make them happy. Organizations (colleges) must find ways to stay in touch with their students to be able to adapt to their shifting preferences, needs, and desires because it is widely acknowledged that students’ perceptions and expectations are brittle and short-lived. When compared to other existing methods, our proposed method SoBC provides high performance for total quality manage­ ment. Figure 11.3 represents a comparative analysis of total quality management. A technique or collection of procedures known as quality control (QC) is de­ signed to make sure that a service or product is made in accordance with a specified set of quality criteria or that it satisfies the needs of the students. QC is comparable to quality assurance (QA) but distinct from it. When compared to other existing meth­ ods, our proposed method SOBC provides high-quality control in detecting students’ performance. Figure 11.4 represents a comparative analysis of quality control. Quality assurance is a component of total quality management, which also de­ velops and expands it. The goal of total quality management (TQM) is to establish a culture of excellence where every staff member strives to delight their pupils and is supported in that goal by the organizational (college) structure. To maintain and enhance their effectiveness, leadership, and student progress through internal and external assessments, colleges need quality assurance. Working toward quality assurance standards will help colleges make sure that both staff and students sup­ port excellent inclusive teaching and learning. When compared to other existing

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Figure 11.3 Comparative analysis of total quality management

Figure 11.4 Comparative analysis of quality control

methods, our proposed method SBOC provides high-quality assurance. Figure 11.5 represents a comparative analysis of quality assurance. The detection rate is the number of hit events per laser pulse, which is normally in the range of one per 100–1,000 laser pulses, as opposed to the count rate, which is the number of student performances recognized in a particular period. When com­ pared to another existing method, our proposed method SOBC provides a high level of detection rate. Figure 11.6 represents a comparative analysis of detection rate.

Quality and Value Management in Education 177

Figure 11.5 Comparative analysis of quality assurance

Figure 11.6 Comparative analysis of detection rate

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Figure 11.7 Comparative analysis of error rate

Figure 11.8 Comparative analysis of accuracy

Quality and Value Management in Education 179 These error rates have been addressed, and they are likely to be of interest to people who need upper bounds on system error rates for specific teachers. How­ ever, these rates are probably higher than average false positive and negative mis­ take rates, which would be of interest to those who need system misclassification rates for teachers as a whole. When compared to other existing methods, our pro­ posed method SOBC provides a low level of error rate. Figure 11.7 represents a comparative analysis of error rate. In concerns about higher education as well as deep learning and its relation­ ship to educational data, predicting students’ success accurately is crucial. When compared to other existing methods, our proposed method provides a high level of accuracy in detecting student performance. Figure 11.8 represents a comparative analysis of accuracy. 11.5

Discussion

Practical challenges in learning decision-making include deciding how deep to grow the decision tree, handling continuous attributes, picking the right attribute selection measure, ability to handle training data with missing attribute values, handling attributes with different costs, and improving computational efficiency. One of decision trees’ shortcomings is that they are considerably more unstable than other choice predictors. The decision tree’s architecture can be significantly impacted by a little change in the data, leading to a different outcome than what consumers are used to seeing. The C4.5 classifier has high learning costs, inade­ quate attribute split strategy, and issues with continuous-valued and missing valued attributes. It also suffers from overfitting. Overfitting and split attributes have the greatest impact on prediction accuracy of all. Data noise affects AdaBoost’s sen­ sitivity. Because it seeks to match each point correctly, outliers have a significant impact on it. XGBoost is faster than AdaBoost. The objective of these algorithms is to identify preferences while ignoring those that are not crucial to the outcome. These tastes can change over time, which can lead to various choices. A computer judgment is based on a portion of the most crucial qualities, values, or standards at any given time. These rough results could influence the wrong choices. Because of their complexity, joint neural networks have several drawbacks that need to be fixed. By analyzing overall performance, our proposed method provides better quality in detecting student’s performance. 11.6

Conclusion

In the education system, the rankings of the students are significant since they show where the institution has room for development. Analysis has been conducted to identify the weak spots where the quality has to be improved. An educational in­ stitution’s objective is to provide a learning environment that maximizes students’ performance and quickly spots pupils who are at risk. To evaluate the student’s performance in digitalization era 4.0, we proposed swarm-optimized bagging C4.5 (SOBC) technique to detect the student’s effective performance. While comparing

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Shashi Kant Gupta and Joanna Rosak-Szyrocka

with other existing methods, our proposed method provides 93% of high quality for total quality management, 96% for quality control, 95% for quality assurance, 94% for detection rate, 99% for accuracy, and 55% for error rate of detecting student’s performance. In the long run, quality management aids in the develop­ ment of more stable and responsible governments as well as sustainable economic growth because it ensures that instruction is tailored to each student’s needs, learn­ ing preferences, and requirements as well as to the prevailing social norms and future perspectives. References Abdushoripovna, R.K. and Abdinazarovna, I.M., 2022. Improving the Organizational and Pedagogical Conditions for the Development of Information Competence of Teachers in the Era of Digitalization. Web of Scientist: International Scientific Research Journal, 3(3), pp.345–348. Aini, Q., Riza, B.S., Santoso, N.P.L., Faturahman, A. and Rahardja, U., 2020. Digitaliza­ tion of Smart Student Assessment Quality in Era 4.0. International Journal of Advanced Trends in Computer Science and Engineering, 9(1.2). Catal, C. and Tekinerdogan, B., 2019. Aligning Education for the Life Sciences Domain to Support Digitalization and Industry 4.0. Procedia Computer Science, 158, pp.99–106. Dobudko, T.V., Korostelev, A.A., Gorbatov, S.V., Kurochkin, A.V. and Akhmetov, L.G., 2019. The Organization of the University Educational Process in Terms of Digitalization of Education. Humanities & Social Sciences Reviews, 7(4), pp.1148–1154. Hidayat, A., Fatimah, S. and Rosidin, D.N., 2022. Challenges and Prospects of Islamic Edu­ cation Institutions and Sustainability in the Digital Era. Nazhruna: Jurnal Pendidikan Islam, 5(2), pp.351–366. Li, W., 2022a. Research on Evaluation Method of Physical Education Teaching Quality in Colleges and Universities Based on Decision Tree Algorithm. Mobile Information Sys­ tems, 2022. Li, Y., 2022b. Quality Evaluation for Physical Education Teaching in Colleges with Joint Neural Network. Security and Communication Networks, 2022. Lin, W., 2022. Digital Reform of the Education Industry in the Post-Epidemic Era. Interna­ tional Journal of Management and Education in Human Development, 2(1), pp.233–237. Rosak-Szyrocka, J., Żywiołek, J., Nayyar, A. and Naved, M., 2023. Advances in Distance Learning in Times of Pandemic, 1st ed. Routledge: Oxfordshire. Wang, J., 2022. Application of C4.5 Decision Tree Algorithm for Evaluating the College Music Education. Mobile Information Systems, 2022. Zhang, Z., Gao, Q. and Chen, F., 2022. Evaluating English Language Teaching Quality in Classrooms Using OLAP and SVM Algorithms. Mobile Information Systems, 2022.

Index

6G networks 7 Acatech (German Academy of Engineering Sciences) 2 acting process 60 additive manufacturing 3, 9, 104, 115 agriculture 48–50 AloT applications 143 AlphaMERS Floating Barrier 53 artificial intelligence (AI) 6, 8, 17, 24, 31–32, 35, 36, 50, 54, 58, 65–66, 100, 113–114, 115, 122, 123, 126, 138, 143, 154, 159, 160, 162 augmented reality (AR) 7, 9, 23, 104, 113, 154, 160 automation 3, 7, 9, 13, 16, 17, 23, 30, 34, 38, 45, 50, 82, 103, 130, 133, 136, 138, 159, 161, 169 big data 3, 9, 100, 101, 112, 123, 126, 144, 161 biotechnology 5, 49–50 blockchain 7, 100, 101–102, 111–113, 115 building design 51–52 business situation analysis 83 capability approach 14 carbon sinks 31 change 89–92, 95–96, 99–100, 106 checking process 60 classical economics 86 client 56–57, 124 cloud technologies 3, 7, 9, 14, 21, 23, 31, 103, 123, 126, 143, 153, 154, 159, 161 cobots 8, 32–33, 39, 45 co-creation 92 cognitive computing 7, 21

collaboration 7, 33–34, 39, 50, 68, 90–91, 96, 102, 111–112, 131, 138, 154, 160 collaborative robotics 3, 8, 17, 23, 24, 32–33, 34, 36, 38, 39, 44, 45 communism 87 competition 83–84, 88, 90–91, 99–100, 109, 112–113 competitive advantage 83 computational intelligence 33 consumer convenience 143 corporate social responsibility (CSR) 84, 129 COVID-19 pandemic 3, 4, 5, 23, 24, 33, 35, 38, 54, 87, 94, 102, 103, 104, 109, 167 CRM system 135 customer expectations 92, 133, 162, 163 customer experience 154 customer focus 60 customer lifetime value (CLV) 135–136 customer needs 92–94, 95, 134 customer satisfaction 132–133, 137–138 customer segmentation 133–135 customer service 154 customer value 130–135 cybercrime 95 cyber-physical systems (CPS) 3, 21, 23, 37, 133, 162 cybersecurity 3, 9, 23, 36, 107 Czech Republic 137 data collection 155 data privacy 36 data quality 59 data security 36, 107, 125 dataset collection 169–171 data storage/analysis technologies 6, 25, 154, 155, 158 demand-side economy 150

182

Index

demographic shifting 90 descriptive/diagnostic/predictive paradigm 161 digital access 16 digital divide 8, 11–13, 17, 52 digitalization 1, 2, 8, 9, 13, 14, 17, 30, 35, 54, 89, 130, 133, 136, 137, 138, 153, 159, 167–169, 175, 179 digital twin/simulation technologies 3, 5, 9, 25, 102–103, 115 disruption 89–90, 92, 109 doing process 60 drone technology 50, 53, 91, 100, 109 dynamic capability theory (DCT) 84 economic crisis 88 economics 86, 87 education 54, 66–72, 160, 167–180 Education for All 70 effectiveness 82 efficiency 3–4, 18, 20, 25, 30–32, 34–35, 37, 39, 44, 59, 82, 83, 96, 115, 122, 123, 124, 142, 157–158, 161–162, 179 empiricism 86 enabling technologies 5–6, 7, 23, 33–34, 38 energy technologies 6, 25, 31, 46–48, 50–51 environment sustainability 50–52 ERP systems 103, 161 ethics 95 European Commission 1, 2–3, 20, 25 European Customer Satisfaction Index (ECSI) 134 evidence-based decision-making 60 Fabbrica Intelligence 3 Factory 5.0 44, 45 financial sector 35–36, 92 Floating Robots for Eliminating Debris (FRED) 53–54 forests 31 French revolution 85 “Green Deal” 1, 2–3 “Green Industry” 1 healthcare 7, 33–34, 94 Holy Turtle 53 honesty 64–65 horizontal/vertical system integration 3, 9

human agency 66 human-centricity 1, 2, 4, 7, 14, 20, 24–25, 38–39, 58 human-machine interaction technologies 5, 9, 25, 34 hybrid software 162 hydroponics 49–50 hyper-personalization 7, 33 implantable technologies 144–147 improvement 60 India: AlphaMERS Floating Barrier 53; digital divide 11–13, 17–18; impact of Industry 4.0 9–13; impact of Industry 5.0 9–18; internet usage 13; labor/workforce 13–18; network readiness 9–12 Indonesia 86, 88, 90, 92–93, 94, 95 Industrie du future 3 Industry 1.0 85–86, 87, 121–122 Industry 2.0 86, 87, 121, 122 Industry 3.0 88–89, 121, 122 Industry 4.0: advantages 45, 106–107, 115–116, 138; applications 100–104, 122–123, 126, 142–144, 154; challenges 105–108, 125–126; competition 109; competitive advantage 112–115; cybersecurity issues 107; data security issues 107; development 1–3, 22, 36, 38; disruption issues 109; drivers 108–110, 143; focus 3, 8, 20, 21, 22–23, 82, 88–89, 90–91, 95, 100; impact on Indian society 9–14, 17; implementation costs 105–106; influence on client value added 124; investment 106–107; labor/ workforce 106; legal/contractual issues 107–108; managerial decision-making 104–105; market demands 108–109; organizational paradigm shift 25–26; resistance to change 106; resource capabilities 109–110; standardization issues 107; sustainable performance 99, 100, 101, 103, 104, 105, 106, 110–115; top-level management motivation/interest 109; value creation 110; weakness 5, 30, 39 Industry 5.0: advantages 30–35, 38–39; agriculture 48–50; challenges 16–17; concept 2–4; disadvantages 36–37, 39; economic-financial

Index dimension 34–35, 37; education 54; enabling technological developments 5–6, 7; energy technologies 6, 25, 31, 46–48, 50–51; environmental dimension 31–32, 36–37; environment sustainability 50–52; goal 38; impact on Indian society 9–18; key elements 4; organizational paradigm shift 25–30; popularity 21; principles/focus 4–5; redefinition of labor/workforce 7–8; revolution 24–30, 39; security 17; social dimension 32–34, 36–37; sustainable development 52–54; transformations 7–9, 13–14, 22–30, 38 information and communications technology (ICT) 52

information quality 59–60

Infrastructure as a Server (IaaS) 103

Inner Harbor Water Wheel 54

integration 64–65

intellectuals 66–70

internet 13, 16, 122, 148

Internet of Things (IoT) 7, 9, 21, 31–32,

38, 61, 89, 100, 103, 113, 115, 123,

138, 144, 154, 159, 162

investment 17, 106–107

183

market segmentation 133

millennium development goals (MDGs) 84

neoclassical economics 87

network readiness 9–12

No Child Left Behind 70

normalization 171

online classes 167

operational technology (OT) 161

organizational paradigm shift 25–30

passive house design 51–52

physical work condition 15

Plan–Do–Check–Act (PDCA) 87

planning process 60

plastic pollution 53–54

platform as a server (PaaS) 103

Polit initiative 54

pollution 23, 38, 45, 50, 52–53, 84

Porter’s Diamond Model 83

predictive maintenance 34

privacy 36

process approach 60

Production 2030 3

product quality 59

QFD methods 134

quality 58–60

Quality 4.0: advantages 155–158;

Kaizen work scheme 87–88 background 153–155; business enhancement 161–162; definition labor/workforce 4, 7–8, 13–18, 24, 45, 54,

155; elements for manufacturing/ 58, 66, 87, 106, 125–126, 142

production 159–162; future 162; leadership 25, 60, 63, 64, 99, 138, 142, 155,

importance 158–159 160, 175

quality assurance 60, 64, 162, 175

liberalism 86

quality control 60, 63, 153, 157–158, 161,

linear discriminant analysis (LDA)

162, 163, 169, 175, 180

171–172

quality improvement 60

living standards 16

quality management: comparative analysis

logistics 110

175–180; definition 60; issues/ Logistics 5.0 35, 92–93

challenges 70–71, 133; main elements 60; plan 159; principles machine learning (ML) 7, 50, 54, 100, 115,

60–61, 63; relationships 61–67; 154, 162

student evaluations 167–180 managerial decision-making 104–105

quality planning 60

manufacturing 3, 7, 9, 22, 38, 86,

87, 102, 104, 115, 144, 153,

radio frequency identification system 100,

159–162

110

Marina Trash Skimmer 54

rational thinking 86

marine pollution 52–53

relationship management 60

market demands 108

remote monitoring systems 7, 144

Marketing 4.0 92

184

Index

resilience 1, 3–4, 5, 7, 20, 24, 35, 38–39,

50

resource capabilities 109–110 resource capability theory (RCT) 84

resources-based view (RBV) theory 83–84 respect 64–65 reverse osmosis 52

reviewing process 60–61 risk aversion theory 82

robotics 3, 7, 8, 9, 23, 24, 32–34, 37, 45,

50, 53–54, 91, 100, 102, 115, 123,

126, 130, 138, 143, 159, 160

scaling 125

security 17

shifting 90, 92

size 91

skills 4, 7–8, 13, 14, 15–16, 18, 34, 35, 39,

54, 58, 66, 99, 142, 147–150

smart education 54

smart hospitals 7

smart manufacturing 7, 22, 50, 153,

159–162

Smart Manufacturing Leadership Coalition

22

sociability 1

social innovation 23

social media 92, 162

social system 64–65 Society 5.0: definition 61–63; indicators

of values 64–65; as intellectually

revolutionized society 66–67;

problem-solving approach 65–66;

quality management 61–64, 70–71;

role 23, 58; role of intellectuals

in building 66–70; value-added

approach 65–66

software as a service (SaaS) 103

soilless agriculture, 50

solo game pattern 91–92

standardization 107

student evaluations 167–180 supply chain management 7, 13,

34, 154

sustainability 1, 3–4, 7, 20–21, 22, 24, 30,

31, 35, 38–39, 44, 45, 47, 50–54,

57–58, 60–61, 64, 70, 72, 84, 91,

102, 112–113, 129, 137

Sustainable Development Goals (SDGs)

52, 55, 85, 95

sustainable performance 99, 100, 101, 103,

104, 105, 106, 110–115

swarm-optimized bagging C4.5 (SOBC) 172–180 SWOT analysis 83

technological innovations 110

three-dimensional (3D) technology 104,

143

Total Quality Management (TQM) 87–88,

175

transformations 7–9, 13–14, 22–30, 38,

89–90

transformative leaders 142

transportation sector 92–93

United Nations (UN) 52, 90

value 57–58, 96

value creation 110

values, rules, and knowledge (VRK) 66

virtual reality (VR) 38, 154, 155, 157, 159,

162

wages 15

water crisis 52

wearable technologies 114, 157, 158, 160,

162

welfarism 14

World Economic Forum (WEF) 9–10