Impacts of Industry 4.0 on Swedish Manufacturing SMEs Context

Abstract Purpose- Industry 4.0 as a concept has created a wave of innovation in the manufacturing sector. In Sweden, the goal for the Swedish manufacturing SMEs is to be leaders in digitalization and stay competitive. Therefore, the purpose of this research is to understand the impacts of Industry 4.0 on Swedish manufacturing SMEs. Method- The method used in this research is a multiple case study consisting of three manufacturing SMEs in Sweden. A literature review was conducted in a systematic way to give a background of Industry 4.0 and its technologies. The literature review provided the theoretical base and knowledge about the phenomena which led to preparation of interview guide used for data collection. Data collection was done through semi-structured interviews. Thereafter, the findings were analyzed within case, cross-case and compared with literature. Findings- To analyze the impacts of Industry 4.0 on the manufacturing SMEs, the author developed a framework which included the ten main Industry 4.0 technologies, Porter ́s generic value chain model and industrial performance indicators. During the analysis, it was found that all the companies were users of Industry 4.0; however, they were using mostly robots as the main technologies besides one company using cloud-platform technology. All the companies had impacts on their value chains operation activity. All five performance indicators flexibility, costs, productivity, quality and lead times were found to impact on Swedish manufacturing SMEs. The findings support the same indicators as found in literature. Furthermore, all three case companies confirmed that they have higher profits which shows that the implementation of Industry 4.0 not only improves industrial performance indicators but also can lead to increase in financial performance. Implications- This thesis contributed to both theory and provides suggestions to managers with primary contribution being the framework which itself is a contribution to the theory. The framework can be used both by researchers and managers. Furthermore, the theory provided in the literature review of impacts of different technologies on the value chain can guide the managers to understand which of the technologies are useful in corresponding activities of value chain. The suggestions provided by industry peers are also a major advantage for the managers to prepare their companies for Industry 4.0. Limitations- The research focused only on manufacturing SMEs in Sweden and from industry perspective, only SMEs manufacturing goods were included and not services. Within the case companies, all ten identified Industry 4.0 technologies were not found to be implemented in SMEs, therefore; the analysis and answers to research questions were based on the technologies found. Moreover, there was a constraint of time and resources which led to a small sample of three manufacturing industries. Keywords: Industry 4.0, The fourth Industrial Revolution, Industrie 4.0, Digitization, Value chain, Supply Chain, Manufacturing, SME, Impacts, Barrier