Bij 03 2018 00561

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Industry 4.0
Industry 4.0 and supply chain and supply
sustainability: framework and chain
sustainability
future research directions
Surajit Bag
Department of Procurement, Tega Industries South Africa Pty Ltd,
Received 6 March 2018
Brakpan, South Africa Revised 22 April 2018
Arnesh Telukdarie and J.H.C. Pretorius 29 April 2018
Accepted 3 May 2018
Faculty of Engineering and the Built Environment, University of Johannesburg,
Johannesburg, South Africa, and
Shivam Gupta
Downloaded by 82.253.26.134 At 01:31 29 December 2018 (PT)
Indian Institute of Management Sambalpur, Burla, India
Abstract
Purpose – The evolution of technology from the most recent industrial age to the technology era better
known as Industry 4.0 resulted in greater demand for horizontal, vertical and end-to-end digital integration.
Prior studies show that Industry 4.0 adoption majorly influences the sustainability aspects in a supply chain
network. The purpose of this paper is to identify the Industry 4.0 enablers of supply chain sustainability and
further attempt to propose a research framework to bridge the theoretical gaps.
Design/methodology/approach – In this research study, the authors have used a systematic literature
review methodology in the field of Industry 4.0 and sustainable supply chain management. The list of papers
was downloaded from Scopus (www.scopus.com) database. Through strict screening, only journal papers
were selected for conducting the review of the literature.
Findings – The review brings out some interesting findings which will be helpful for the research
community. There have been limited research in the area of managing supply chain network sustainability
through Industry 4.0 technologies. The authors found only 10 papers out of a total of 53 papers which
emphasize on smart manufacturing, smart production system, smart warehouse management system, smart
logistics and sustainability. Most of the previous research studies have ignored the social aspects of supply
chain sustainability. Finally, the authors identified 13 key enablers of Industry 4.0 playing an important role
in driving supply chain sustainability.
Practical implications – The strategies for Industry 4.0 should be refined and detailed to develop economic
and social systems that can act flexibly to sudden changes in the system. Top management must be
convinced for prioritizing investment support and creating a system that can facilitate technology
convergence. Managers must also act on new models of employment and frame plans to continuously
improve the system. In addition, managers must focus on establishing a collaborative platform to facilitate
high-tech research and developments. Finally, it is essential to develop a performance management system
for monitoring all actions in the supply chain network.
Originality/value – Integrating two independent subjects is the uniqueness of the current study. Here,
Industry 4.0 and supply chain sustainability have been integrated to build the research framework, and in
such a process, the authors have extended the existing knowledge base.
Keywords Enablers, Literature review, Cyber-physical systems, Industry 4.0, Supply chain sustainability
Paper type Literature review
1. Introduction
The introduction of Industry 4.0 has proven to be successful in providing various business
benefits including operational optimization and value chain optimization (Strange and
Zucchella, 2017). Industry 4.0 is popularly adopted by German firms such as Volkswagen,
Daimler and BMW. Recently, Chinese Government has also introduced the “Made in China
2025” strategy which focuses on improving manufacturing through speeding up the Benchmarking: An International
Journal
digitalization in China. Similar kind of initiatives have also been undertaken by the US, © Emerald Publishing Limited
1463-5771
French, UK, Japanese and Singaporean Government. DOI 10.1108/BIJ-03-2018-0056
BIJ The ability to merge the concepts of Industry 4.0 and sustainable supply chain is the
focus of this research. Key development in sustainable supply chain focuses on enhancing
the environmental, social and economic benefits, and key development in Industry 4.0
includes total system integration and automation (Kagermann, 2015; Zhou et al., 2015).
The term Industry 4.0 initially came into existence from a project executed under
German Government for supporting computerization in manufacturing (Sung, 2018).
Therefore, Industry 4.0 has a close link with industry operations and Information
Technology, and automation (Cardin et al., 2017; Kusiak, 2018).
Sung (2018) referred in his article about McKinsey survey of 300 manufacturing firms
which provided a surprising result. It reported that only 48 percent of firms think that they
are actually ready to initiate Industry 4.0 project. The question still remains: what can be the
underlying reasons for the poor adoption rate and unsustainability of Industry 4.0 projects?
Industry 4.0 enables machines in the factory to become independent so that these
machines can plan, program and produce goods automatically without an operator.
Industry 4.0 improves flexibility in production which leads to an increased customization of
products. In such an environment, the machines will communicate with each other for the
execution of production plan. Smart factory systems work in the background and are aware
of objects in the surrounding environment. However, firms face certain challenges while
adopting Industry 4.0 projects and which can potentially impact sustainability aspects in
the supply chain network.
Sung (2018) pointed out that it is difficult for any firm to identify the best suitable
technologies which can provide good return on any investment made by firms so that such
technologies can possibly be avoided. Therefore, wrong technology selection may impact
the economic aspects of sustainability. Another challenge is the amount of job losses due to
process automation and information theory (IT) enablement which may create a negative
impact in poor education areas of the society such as in African countries and this may
potentially influence the social aspects of sustainability. With the evolving nature of
Industry 4.0, technologies, suppliers in the network must upgrade knowledge and skills to
continuously provide best services to their customers. Suppliers and sub-suppliers who fail
to do such up-gradation gradually perish in the long run. This has social implications
especially in the African context where government is continuously emphasizing on
economic empowerment through different initiatives.
The key research question addressed via this research includes an analysis on the
impact of technology, specifically Industry 4.0 in developing a sustainable supply
chain. This research focuses on blending together the two fundamentals and delivering a
research framework.
1.1 Context and motivation

Digital transformation is no more a choice to the manufacturers in today’s dynamic business
environment and is rather an imperative for survival. The previous three industrial
revolutions have witnessed a significant improvement in firms’ productivity. The past
industrial revolutions had effect on the shop floor level only. Industry 4.0 is a more advanced
concept and drives productivity much more by involving support functions such as
engineering (Schuh et al., 2013). Under Industry 4.0 concept, the factory workers may work
with smart phones and tablets for running production and performing communication at all
levels. However, the dark side of all previous industrial revolutions has been the ignorance of
social and environmental dimensions. Moreover, unequal environmental information exists
between firm and (both internal and external) customers. Successful implementation of any
project and firm’s capability to perform is highly dependent on resources. So, we see that there
is a significant opportunity to apply the IT and dynamic capability view (DCV) theory and
study Industry 4.0 mechanism in driving supply chain sustainability.
1.2 Business problem Industry 4.0
The first industrial revolution was driven through steam power that transformed lives of and supply
people. The second industrial revolution was driven through electricity and communication, chain
enabling just in-time operations and production lines by the mid-1800s. The twentieth
century witnessed the third industrial revolution through the introduction of Information sustainability
Technology. However, the fourth industrial revolution is much more advanced which
involves cyber-physical systems (CPS) and can process data at super fast speed at a fraction
of cost compared to previous applications. The fourth revolution has gifted enhanced speed,
increased visibility and cost economics beyond our imagination.
However, the burning problem in front of industries is the lack of coherent
strategy for managing total supply chain sustainability all delivered through automation
and enabled workflows. Poor management lowers efficiency, thereby leading to direct and
indirect financial losses. Enhancing skills, changing the traditional organization structure
and change management are critical levers under the Industry 4.0 digitalization.
Therefore, social, environmental and economic impacts have certain crucial
implications for the firm and need to be taken care through proper technological
selection and management.
Finally, firms losing a huge amount of money annually through the wrong selection of
Industry 4.0 technologies also majorly impact the supply chain operations. This creates loss
of face value in the market and also business losses. Therefore, it is imperative for firms to
recognize all the Industry 4.0 enablers which may lead to smooth supply chain operations
and achieve sustainability.
1.3 Research problem

The research problem is to identify the enablers of Industry 4.0 implementation driving
supply chain sustainability for theory building purpose.
The rest of the sections are organized as follows. Section 2 provides the review of
existing literature and analysis of review followed by Section 3 on the research framework;
the final section presents the conclusion, managerial implications, contribution to theory
and future research directions.
2. Literature review
In this research study, we have used the systematic literature review (SLR) methodology in
the field of Industry 4.0 and sustainable supply chain management. The list of papers was
downloaded using Scopus (www.scopus.com), which is the largest abstract and citation
database for academic reputed scientific research journals, books and conference
proceedings. Through strict screening, only journal papers were selected for conducting
the review of literature. These relevant journal papers have been classified and further
categorized into various groups. The SLR methodology was adopted based on the
guidelines advised by Tranfield et al. (2003). The key steps in the SLR are planning the
strategy for literature review, conducting the literature review and reporting the findings
from literature review.
Scopus database consists of papers from four fields, such as Life Sciences, Health
Sciences, Physical Sciences and Social Sciences. This allows for conducting research studies
in cross-disciplinary fields, which was one of the primary purposes for selecting Scopus
database in this research study.
This research study undertakes a novel attempt to combine two independent concepts,
the first concept from the domain of Business Management (sustainable supply chain) and
the second concept from the domain of Information Technology (Industry 4.0).
The literature review sub-sections are as under:
BIJ 2.1 Sustainable supply chain management
2.1.1 Planning the review of literature. For sustainable supply chain management literature
search on Scopus on January 21, 2018, the authors found keyword: “Sustainable Supply Chain
Management”; language: English; subject area: Business, Management and Accounting;
document type: Journal Papers; exclude: 2018 (as the year is not complete and thus complete
picture of 2018 will not be showcased); selected papers with DOI and finally obtained 242
journal papers. Table I provides detailed search syntax used in this study.
The search process can be re-run on Scopus website by simply copying and pasting the
referred syntax under the advanced search option. However, the output may vary due to the
constant updating happening on the digital database. The data were obtained on Sunday,
January 21, 2018 at 12:15 p.m., South African time (Figure 1).
2.1.2 Conducting the literature review. This section details the classification of research
papers. The pie chart shows the range of research papers which was obtained after Stage 2
in the paper search process. We found that the maximum number of papers was published
in the field of Business Management followed by other fields (Figure 2).
We present Figure 3 showing the publishing trend. The number of publishing went up
from 2011 onwards.
Authors further identified the ten papers which attracted the highest number of citations
and are tabulated in Table II.
2.2 Industry 4.0

For Industry 4.0 literature search on Scopus dated: on January 21, 2018, we obtained one list
which had 76 documents with only journal papers and English as language and the subject
area: Business Management and Accounting. Table III provides detailed search syntax used
in this study.
constant updating happening on the digital database. The data were obtained on Monday,
Source of data collection Search syntax
Search performed on Scopus on January 21, TITLE-ABS-KEY (“Sustainable Supply Chain Management”)
2018 website: www.scopus.com AND (LIMIT-TO (SUBJAREA, “BUSI”)) AND (LIMIT-TO
Table I. (LANGUAGE, “English”)) AND (LIMIT-TO (SRCTYPE, “j”))
Search syntax AND (EXCLUDE (PUBYEAR, 2018))
Step 1
Relevant Research Papers for Keywords: n = 252
“Sustainable Supply Chain Management”: No. 1
Step 2
Figure 1. Consider papers with DOI only n = 242
Steps of selecting the
SSCM research papers
for literature review
Source: Authors’ own compilation
Psychology (0.4%) Industry 4.0
Arts and Humanities (4.8%) and supply
Computer Science (8.0%)
Energy (18.8%)
chain
Social Sciences (20.4%) sustainability
Business, Management
and Accounting (100.0%)
Economics (20.8%)
Environmental Sciences (26.4%)
Figure 2.
Decision Sciences (26.8%) Range of research
Engineering (36.0%)
papers after Stage 2
60
50
40
Documents
30
20
10
Figure 3.
0 Number of research
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 papers published
per year
February 5, 2018 at 1 p.m., South African time. The steps of selecting the Industry 4.0
research papers for literature review are showcased in Figure 4.
papers. The pie chart (refer Figure 5) shows the range of research papers which was
obtained after Stage 4 in the paper search process. We found that the maximum numbers of
papers is published in the field of Business Management, the second highest being
Engineering, the third highest being Decision Sciences and followed by other fields.
The publishing trend can be seen in Figure 6. Interestingly, the number of publishing
went up from 2015 onwards and significantly in 2017.
and are tabulated in Table IV.
BIJ Author(s), Year Corresponding author’s affiliation Citations
Seuring and Müller Department of International Management, Faculty of Organic 2,885

(2008a, b) Agricultural Sciences, University of Kassel, Witzenhausen, Germany
Carter and Rogers (2008) College of Business Administration, University of Nevada, Reno, 2,066
Nevada, USA
Pagell and Wu (2009) York University 819
Carter and Easton (2011) Arizona State University, Tempe, Arizona, USA 768
Gold et al. (2010) Department of International Management, University of Kassel, 516
Witzenhausen, Germany
Hassini et al. (2012) DeGroote School of Business, McMaster University, Hamilton, Canada 492
Ahi and Searcy (2013) Department of Mechanical and Industrial Engineering, Ryerson 465
Table II. University, Toronto, Canada
Ten top papers which Seuring (2013) Department of Supply Chain Management, Faculty of Business and 465
attracted max Economics, University of Kassel, Kassel, Germany
citations and Wu and Pagell (2011) College of Business, Oregon State University, Corvallis, Oregon, USA 402
corresponding Seuring and Müller Department of International Management, University of Kassel, 384
author’s affiliation (2008a, b) Witzenhausenkass, Germany
Search performed on Scopus on January 21, TITLE-ABS-KEY (“Industry 4.0”) AND (EXCLUDE
2018 website: www.scopus.com (PUBYEAR, 2018)) AND (LIMIT-TO (DOCTYPE, “ar”) OR
LIMIT-TO (DOCTYPE, “ip”) OR LIMIT-TO (DOCTYPE, “re”))
Table III. AND (LIMIT-TO (SUBJAREA, “BUSI”)) AND (LIMIT-TO
Search syntax (LANGUAGE, “English”))
Step 1
Relevant Research Papers for Keywords: n = 1,975
“Industry 4.0”: No. 1
Step 2
Exclude 2018 n = 1,899
Step 3
Include: business, management and accounting; n = 97
article, articles in press and review papers;
English language
Figure 4. Step 4
Steps of selecting the Consider papers with DOI only n = 76
Industry 4.0 research
papers for literature
review
Others (1.0%) Industry 4.0
Energy (1.0%) and supply
Materials Science (2.1%)
Arts and Humanities (2.1%)
chain
Psychology (4.1%)
sustainability
Economics (4.1%)
and Accounting (100.0%)
Social Sciences (6.2%)
Computer Science (13.4%)
Decision Sciences (56.7%)
Figure 5.
Engineering (75.3%) Range of research

60
50
40
Documents
30
20
10
Figure 6.
0 Number of research
2012 2013 2014 2015 2016 2017 papers published
per year
2.3 Industry 4.0 and sustainable supply chain management

Here, an attempt was made to combine two independent concepts, the first concept from the
domain of Information Technology (Industry 4.0) and the second concept from the domain
of Business Management (sustainable supply chain). Keywords used to search the academic
literature for these two concepts are provided in Table V.
The literature search process on Scopus database was conducted as an independent
process by means of using “or” operator for individual keyword, and further the search
output of the two concepts was combined by means of using “and” operator. Table VI
provides detailed search syntax used in this study.
BIJ Author(s), Year Corresponding author’s affiliation Citations
Kang et al. (2016) Department of Systems Management Engineering, Sungkyunkwan 84

University, Gyeonggi-do, South Korea
Ivanov et al. (2016) Chair International Supply Chain Management, Berlin School of Economics 64
and Law, Berlin, Germany
Sommer (2015) Department of Business Administration and Engineering, Albstadt- 32
Sigmaringen University, Germany
Sanders et al. (2016) Institute of Production Engineering, Helmut-Schmidt-University, Germany 28
Theorin et al. (2017) Department of Automatic Control, Lund University, Sweden 27
Zawadzki and Chair of Management and Production Engineering, Poznan University of 25
Żywicki (2016) Technology, Poland
Hirsch-Kreinsen Department of Economic and Industrial Sociology, Faculty of Economics 24
Table IV. (2016) and Social Sciences, TU Dortmund University, Dortmund, Germany
Ten top papers which Liao et al. (2017) Polytechnic School, Pontifical Catholic University of Parana, Curitiba, Brazil 21
attracted max Zheng and Wu (2017) Fusion Innovations Ltd, Research and Innovation Services, Birmingham 20
citations and Research Park, Birmingham, UK
corresponding Agarwal and Brem Otto-Friedrich-University, Bamberg, Germany 16

author’s affiliation (2015)
Industry 4.0 Sustainable supply chain management
“Industry 4.0” “Sustainable supply chain”

Table V. “Industrial internet of things” “Sustainable development”
Keywords used for “Embedded systems” “Sustainable operations”
searching relevant “Cyber physical system” “Smart logistics”
literature Source: Authors’ own compilation
Search performed on ((TITLE-ABS-KEY (“industry 4.0”) OR TITLE-ABS-KEY (“industrial internet of

Scopus on January 22, things”) OR TITLE-ABS-KEY (“embedded systems”) OR TITLE-ABS-KEY (“cyber
2018 website: www. physical system”))) AND ((TITLE-ABS-KEY (“sustainable supply chain”) OR
scopus.com TITLE-ABS-KEY (“sustainable development”) OR TITLE-ABS-KEY (“sustainable
operations”) OR TITLE-ABS-KEY (“smart logistics”))) AND (EXCLUDE
(PUBYEAR, 2018)) AND (LIMIT-TO ( DOCTYPE, “ar”) OR LIMIT-TO (DOCTYPE,
“re”) OR LIMIT-TO (DOCTYPE, “ip”)) AND (LIMIT-TO (LANGUAGE, “English”))
Table VI. AND (LIMIT-TO (SRCTYPE, “j”))
Search syntax Source: Authors’ own compilation
constant updating happening on the digital database. The data were obtained on Monday,
January 22, 2018 at 6:35 p.m., South African time (Figure 7).
papers. The pie chart (refer Figure 8) shows the range of research papers which was
obtained after Stage 5 in the paper search process. We found that the maximum number of
papers was published in the field of Engineering, the second highest was Environmental,
the third highest was Computer Science and followed by other eight categories.
Step 1 Industry 4.0
Relevant Research Papers for Keywords:
“industry 4” or “industrial internet of things” n= 76,686
and supply
or “embedded systems” or “cyber physical chain
systems”: No. 1 sustainability
Step 2
Relevant Research Papers for Keywords:
“sustainable supply chain” or “sustainable n= 148,226
development” or “sustainable operations” or
“smart logistics”: No. 2
Step 3
Merging the above two searches: No. 3 n= 262
Step 4
Include only Journal papers, English language
n= 56
and subject area as Business Management and
Accounting
Step 5 Figure 7.
Consider papers with DOI only n= 53 Steps of selecting the
Industry 4.0 and
SSCM research papers
for literature review
Others (9.4%)
Chemistry (3.8%)
Biochemistry (3.8%) Engineering (54.7%)
Mathematics (9.4%)
Decision Sciences (9.4%)
Social Sciences (20.8%)
and Accounting (20.8%) Environmental Sciences (32.1%)
Energy (22.6%) Figure 8.

Computer Science (30.2%) Range of research
We provide the publishing trend (refer Figure 9); interestingly, the number of publishing
went up from 2009 onwards and significantly in 2016.
and are tabulated in Table VII.
BIJ 25
20
Documents
15
10
Figure 9.
Number of research 0
papers published 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018
per year
Author(s), Year Corresponding author’s affiliation Citations
Buchholz et al. (2009) Department of Forest and Natural Resources Management, College of 205
Environmental Science and Forestry, State University of New York,
New York, USA
Banerjee et al. (2012) School of Computing, Informatics, and Decision Systems Engineering, 149
Arizona State University, Tempe, Arizona, USA
Moser et al. (2010) C. Moser and L. Thiele are with the Computer Engineering and Networks 93
Laboratory, Swiss Federal Institute of Technology Zurich, Zurich, Switzerland
Gupta and Palsule- Impact Lab, School of Computing, Informatics, and Decision Systems 64
Desai (2011) Engineering, Arizona State University, Tempe, Arizona, USA
Franken et al. (2012) Institute of Health Policy and Management, Erasmus University, 51
Rotterdam, The Netherlands
Scognamiglio et al. Dipartimento Agroalimentare, Istituto di Cristallografia, Via Salaria 44
(2014) Monterotondo Scalo, Rome, Italy
Leary et al. (2012) Department of Mechanical Engineering, University of Sheffield, Sheffield, UK 41
Wang et al. (2015) Department of Electrical and Computer Engineering, Michigan 33
Table VII.
Technological University, Houghton
Ten top papers which
attracted max Aylott et al. (2010) School of Biological Sciences, University of Southampton, UK 28
citations and Bolton and Hannon Department of Science, Technology and Innovation Studies, School of 24
corresponding (2016) Social and Political Science, University of Edinburgh, Edinburgh, UK
author’s affiliation Source: Authors’ own compilation
2.4 Defining key terms

Here, we attempt to define the main pillars of Industry 4.0 concept.
CPS: computation, networking and physical processes are integrated to form a CPS. It
involves signal processing and control of manufacturing processes using computers. CPS
can be used to manage big data and control the interconnectivity of machines to help them
become independent from human intervention (Wolf, 2009; Lee et al., 2015). The model
proposed by Lee et al. (2015) presented a 5 C architecture which shows stepwise guideline for
creating and setting up a CPS system for manufacturing operations. The first level consisted
of smart connection; second level consisted of data-to-information conversion; third Industry 4.0
consisted of cyber level; fourth consisted of cognition level; and final layer consisted of and supply
configuration level. CPS forms one of the key pillars behind Industry 4.0 concept. chain
Internet of Things (IoT): this concept is based on the use of internet to access data from
remote sensors and control physical objects in the surrounding environment. sustainability
Yang (2014) described IoT as integration of wireless sensor networks with the internet.
In the manufacturing operations, RFID technology is commonly used to gather data and
make decisions. When the ID tag is attached to any object, then it automatically becomes a
smart object (Kopetz, 2011). To adopt a comprehensive IoT framework, it is essential to have
an efficient, secure, scalable, market-oriented computing and storage resourcing. IoT
consists of three key components such as hardware, middleware and presentation.
Hardware consists of sensors, actuators and embedded systems. Middleware consists of
storage and data analytics tools. The presentation part consists of visualization and
interpretation tools that can be accessed on various platforms and can be designed for
various applications (Gubbi et al., 2013).
Cloud computing: It has taken digitalization to a new level through enhanced data
management and storage processes. Cloud computing has provided more reliable services
through next generation data centers that are based on virtualized storage technologies. Such
platforms are hidden in the background and receive data from the ubiquitous sensors, and
analyze and interpret the data for providing users with an easy to understand web-based
visualization (Kaufman, 2009; Armbrust et al., 2010; Gubbi et al., 2013). The software
applications and data are stored in the servers that are kept in the data centers located globally
to give best services to users. The key feature of cloud computing is scalability. Users can add
or remove the hardware and software in cloud data center as per their dynamic requirements.
Singh and Singh (2016) mentioned that three architectures that form the foundation of cloud
computing are as follows: Software as a Service; Platform as a Service and Infrastructure as a
Service. Cloud computing is another key pillar of Industry 4.0 and smart factory.
Real-time supply chain optimization: with intense global competition and rising costs of
labor and energy, manufacturers have transformed into integrated networks for survival.
IoT, CPS and cloud computing lead to the virtualization of manufacturing processes and
ensure smooth operations across the supply chain through real-time information
availability. Simulation and optimization tools form a part of smart factory and are
useful for optimal operations which lead to production flexibility and enhanced innovations
(Brettel et al., 2014).
2.5 Reporting the findings from literature review

Industry 4.0 is the central theme of the fourth industrial revolution which integrates core
technologies such as IoT, CPS and cloud computing. Industry 4.0 has enabled firms’
advancement by significantly enhancing the productivity and efficiency.
The literature review brings out some interesting facts which will be helpful for the
research community. Although there have been studies in all domains, limited studies exist
in the area of managing supply chain network through smart technologies. From Stage 5 of
review, we have identified 53 research papers which talk on both Industry 4.0 and
sustainability. However, only 10 papers out of these 53 papers actually discuss smart
manufacturing, smart production system, smart warehouse management system, smart
logistics and sustainability, which means there is a vast scope of research work in this
direction. Most of the previous research works ignored the social aspects of supply chain
sustainability. We also did not find any paper which provided a holistic framework on
sustainable supply chain network design and Industry 4.0 concept. The summary of the ten
papers was tabulated and presented in Table AI. Further, we attempt to present the research
gaps, research objectives and research questions that are central to this study.
BIJ 2.6 Research gaps
The existing literature show evidence of technologies enabling Industry 4.0 and smart
factory which ultimately has a link with supply chain sustainability. However, previous
studies do not clearly show how both the concepts (Industry 4.0 and supply chain
sustainability) are linked together and how (mechanism) Industry 4.0 concept leads to
supply chain sustainability.
The current research study aims to eliminate the void in the existing literature and
further extend the knowledge base by scientifically designing this study for collecting
evidence and finally presenting the findings in the form of a detailed report.
2.7 Research questions

The gaps in the existing literature lead to develop the questions that will direct this research
study as under:
RQ1. What are the Industry 4.0 enablers of sustainable supply chain management?
RQ2. Can a model be developed by integrating the concept of Industry 4.0 and
sustainable supply chain management?
2.8 Research objectives

The research questions guide researcher to develop the main objectives of the current study:
• RO1: to identify the Industry 4.0 enablers of sustainable supply chain management.
• RO2: to develop a model integrating the concept of Industry 4.0 and sustainable
supply chain management.
The next section attempts to answer the above two research questions.
3. Industry 4.0 enablers of sustainable supply chain management and

research framework
3.1 Based on the preceding discussions and review of prior literature, the below Industry
4.0 enablers is derived which leads to supply chain sustainability
Government support: financial support from Central Government is necessary for driving
Industry 4.0 in the South African economy. However, the main concern for firms is the level
of security. Government legislations on cyber security are essential to eradicate threats and
vulnerabilities. Government must remove unfair trade barriers to improve import and
exports. Department of Trade and Industry must strengthen cooperation with industrial
sector for removing resource-related bottlenecks. Finally, the support of the Department of
Science and Technology to industries will help in converting local innovations into
commercial products. Such innovations will flow in the supply chain network and lead to
sustainable development (Siemieniuch and Sinclair, 2015; Hermann et al., 2016; Liao et al.,
2017; Sung, 2018).
Support of research institutes and universities: for driving Industry 4.0 sustainably, it is
necessary for research institutes and universities to provide adequate support for
infrastructure development. Collaboration between research institutes and universities with
industries will facilitate skills development, human resource training and transfer. Such
initiatives will also aid in inter-organizational arrangements for pursuing collaborative
research and development projects. Transfer of university created intellectual property such
as patents to industries also enable sustainable Industry 4.0 implementation. Such
collaboration will be useful for social relationship development through various conferences,
meetings and social networks. The knowledge transfer to suppliers in multiple tiers is
possible through the support of research institutes and universities. Such knowledge Industry 4.0
transfer and awareness creation will reduce risks and chances of Industry 4.0 failure in the and supply
supply chain network (Guimón, 2013; Sung, 2018). chain
Law and policy regarding employment: Industry 4.0 brings a new era of supply chain
digitalization which is better in terms of productivity and economic development. However, sustainability
the dark side of this fourth industrial revolution is replacing human labors with robots in the
shop floor which will cause huge job losses both at the supplier and customer side. New
labor and employment legislation is required for safeguarding human quotas in this new era
of robotics and automation. This will help to protect job losses and create a balance in
system. It is also essential to develop a national level framework to support the unemployed
people in the country (Sung, 2018). Thus, law and policy regarding employment would lead
to sustainable development in the supply chain network by securing jobs of workers and
reducing unemployment levels.
Improved IT security and standards: the basic requirement for Industry 4.0 sustainability
is security because the industrial control system is continuously interacting with the smart
objects. Firms must conduct an initial assessment to identify the potential hazard and
prioritize risk, such as that outlined in the health and safety standard IEC 61508. Then, firms
can follow the recommendations for providing cyber security technologies and protection for
improving control system security, set out in standards such as NIST SP800-82, ISA-99 or IEC
62443. Industry 4.0 is totally systems dependent enabled through information technologies.
Therefore, medium to long duration systems downtime caused due to poor IT security and
low standards will bring the entire supply chain operations to a standstill and lead to millions
of financial losses. Firms must focus on developing good IT governance in the supply chain
network for sustainability (Benias and Markopoulos, 2017; Sung, 2018).
Information transparency: information transparency and proper communication
between customers and suppliers in the supply chain network is essential for the
successful adoption of Industry 4.0 technologies. This can be possible through the creation
of a virtual copy of the physical world by enriching digital plant models with sensor data.
This is enabled by data analysis and provision of information (Sung, 2018).
Standardization and reference architecture: it is essential for firms to focus on the
development of a single set of common standards to support collaboration and reference
architecture to provide a technical description of these standards. This will lead to the
successful adoption of Industry 4.0 in the supply chain network (Liao et al., 2017).
Management commitment: management commitment is a fundamental requirement for
successful Industry 4.0 project driving supply chain sustainability. Management approvals
for big investment in newer technologies are essential to fit Industry 4.0 requirements.
Periodic management review helps in removing bottlenecks in the supply chain. Focus on
process automation, quality systems and customers actually drives such projects. Firms must
start focusing on developing leaders with new set of skills required in this digital world. Such
management initiatives would lead to the better adoption of Industry 4.0 and drive
sustainability in the supply chain network (Bauer et al., 2015; Gilchrist, 2016; Sung, 2018).
Focus on human capital: for shifting to digital smart factory, firms are annually
investing a huge amount of income in training and continuous education of workers. This is
intended to upgrade skill sets of workers as per Industry 4.0 requirements and develop
competency for specialized jobs. Industry 4.0 adoption calls for advanced level of skills and
data analysis. Such training will help the employees to prepare themselves to cross the
hurdles during pre and post Industry 4.0 implementation stages. Moreover, such trained
personnel will further train and educate their suppliers and sub-suppliers in the supply
network to help them survive and advance together in this digital age (Sung, 2018).
Change management: firms are actively involved in change management for converting
from traditional systems to modern systems. Industry 4.0 calls for the adoption of new
BIJ organization structure, new systems and policies. Firms must proactively handle the
attitude of workers and their resistance to drive Industry 4.0 implementation. Managing
changes strategically helps to avoid any kind of disruption in the supply chain network and
achieve sustainability (Aladwani, 2001; Sung, 2018).
Horizontal integration: firms are doing horizontal integration over the business value
networks. This involves internal expansion, mergers and acquisitions which aid in driving
Industry 4.0 projects sustainably (Qin et al., 2016).
Vertical integration: vertical integration is done by firms to drive Industry 4.0 projects. In
such process, firms control their subsidiaries for input material. Collaboration with suppliers
and collaboration with customers in vertical integration is essential for sustainable supply
chain management (Harrigan, 1984; Zhou et al., 2015; Stock and Seliger, 2016; Qin et al., 2016;
Sung, 2018).
Corporate governance: the fundamental idea is to frame the corporate set of rules,
policies and action plans to perfectly fit Industry 4.0 requirements. Proper framework is
required for attaining firm’s digital objectives. This will enhance ownership and control. It
can further improve transparency with internal stakeholders and can be considered as a
driving force in Industry 4.0 for sustainability (Elkington, 2006; Aras and Crowther, 2008;
Walls et al., 2012).
Third-party audits: firm using third-party audits has been benefitted directly and
indirectly. Third-party audits automatically help to identify the gaps and weaknesses
restricting firms for transforming into a smart factory. Third-party audits doing
specifically security audits that include industrial control systems, partner network
access, maintenance network access and wireless links are essential. Auditors must audit
the IT policy which defines person responsible for identifying cyber threats and
vulnerabilities; audit how the mitigation strategies will be evaluated by firms; audit the
crisis management strategies and finally assess the cyber insurance. This will ensure
safety, security and sustainability in the supply chain network. Customers and suppliers
in the supply chain network must jointly work on Industry 4.0 projects and arrange audit
using third parties to identify the gaps in project and further take necessary measures to
rectify those errors and march toward digitalization (bin Baharin et al., 2003; Gordon et al.,
2003; Li et al., 2011; Duflo et al., 2013).
3.2 Theoretical perspectives on Industry 4.0 and supply chain sustainability

Theory can be used for analyzing, explaining, predicting, and both explaining and
predicting the theory for design and action. Therefore, theory can help to explain the
phenomena that are of interest under any particular discipline and describe the boundaries
of the discipline (Gregor, 2006).
The current study uses IT and DCV (DCV ) theory as a theoretical lens to develop the
research framework.
IT deals with the quantification, storage and communication of information. IT was
originally proposed by Claude E. Shannon in 1948 to find basic limits on signal processing
and communication operations such as data compression, in a landmark paper entitled “A
Mathematical Theory of Communication.” IT is nowadays widely used in other disciplines.
Some of the seminal papers on IT are Goldstine (1961), Marcus (1963), Hartley (1964) and
Gregor (2006).
As per Simpson et al. (2007), unequal environmental information exists between the
industry and (both internal and external) customers. There is a significant opportunity to
study the IT application in context to Industry 4.0 and sustainability practices.
The enablers which have been derived from IT are: law and policy regarding
employment; improved IT standards and security; corporate governance; standardization
and reference architecture; third-party audits and information transparency. Among firms
practicing Industry 4.0, these enablers will actually help to streamline information flow Industry 4.0
across the supply chain network. Information flow and transparency will aid in better and supply
decision making. These enablers link Industry 4.0 with supply chain sustainability and chain
drive the underlying sustainability mechanism in the supply chain network.
DCV theory is an extension of resource-based view (RBV ) theory. The RBV theory argues sustainability
that firms achieve competitive advantage through the bundling of resources to develop
capabilities (Barney, 1991). Bundling is integrating available internal and external resources
to develop innovative capabilities and create values to stand out relative to market
competition. Resources can be in both tangible and intangible forms and enable companies to
develop capabilities. Such capabilities are influenced by business environments in which
companies operate. DCV theory explains how dynamic capabilities enable a firm to integrate,
create and reconfigure resources for sustainability in this dynamic business
environment. Dynamic capabilities play a critical role in the sustainability of a firm under
a complex and volatile environment (Teece and Pisano, 1994; Teece et al., 1997; Helfat and
Peteraf, 2003; Wu, 2006).
Those enablers who have been derived from DCV theory are: government support;
support of research institutes and universities; management commitment; focus on human
capital; change management; horizontal integration and vertical integration. These
enablers play a critical role in building the firm’s capabilities to adopt Industry 4.0
sustainably in the supply chain network. These enablers also link Industry 4.0 with
supply chain sustainability and drive the underlying sustainability mechanism in the
supply chain network.
To answer the second research question, the research framework is presented in
Figure 10 which is based on preceding theoretical discussions. Here, the literature is
classified into 13 building blocks of the supply chain sustainability framework.
Government
Support
Support of
Third Party
Research Institutes
Audits
and Universities
Corporate Law and Policy

Governance Regarding
Employment
Supply Chain
Sustainability
Vertical
Integration Improved IT
Security and Standards
Horizontal
Integration Management
Commitment
Change Standardization
Management and Reference
Focus on Information Architecture
Figure 10.
Human Capital Transparency Research framework
BIJ 4. Discussion
Industry 4.0 brings an era of supply chain revolution through digitalization and smart
technologies. Globally, companies are gradually moving toward the adoption of such
enabling technologies to avoid perishing in this volatile, uncertain, complex and ambiguous
environment. However, Industry 4.0 has some dark side which impacts the supply chain of a
company during pre and post implementation stages. The major issues are job losses of
workers; low morale of employees; lack of Industry 4.0 knowledge among suppliers in the
network; lack of funding for technological up-gradation; lack of specialized suppliers
suitable for Industry 4.0 projects; and lack of IT security standards and policies which affect
both the customer and suppliers in the supply chain network. These problems can create
more uncertainties and attract more risks which can lead to supply chain disruptions in the
pre and post stages of Industry 4.0 adoption. Such issues can be addressed by the company
through the management of all the 13 enablers which were identified through literature
review and grounded upon a theoretical base. Industry 4.0 project calls for collaboration
between customers and suppliers in the supply chain network to digitally link all the
enterprises for sustainable development.
5. Conclusion
The research study has been developed on a brilliant topic which addresses the calls of
previous researchers. Industry 4.0 has bought a digital revolution supported by CPS, IoT
and cloud computing. Industry 4.0 has multiple benefits such as the establishment of smart
production and production processes. In contrast to such benefits, there are certain negative
effects which can significantly impact supply chain sustainability and this further
motivated researchers to pursue this study. On the systematic review of prior studies, it was
found that ten papers only considered Industry 4.0 and supply chain sustainability which
clearly shows that this area is under researched. The study further extended the knowledge
base by identifying the key Industry 4.0 enablers of supply chain sustainability. A
framework has been proposed demonstrating the 13 enablers that influence supply chain
sustainability. The enablers are government support; support of research institutes and
universities; law and policy regarding employment; improved IT security and standards;
management commitment; focus on human capital; change management; horizontal
integration; vertical integration; standardization and reference architecture; and corporate
governance and third-party audits.
5.1 Managerial implications

The key take-aways for managers are as follows. Managers must design Industry 4.0
project by considering the enablers which have potential to influence the supply chain
sustainability. Firms must collaborate with research institutes and universities for Industry
4.0 infrastructure development. Such collaboration will benefit greatly in terms of skill
development, human resource training and transfers. It is very essential for firms to practice
good IT governance for maintaining a high level of IT security and standards. Moreover,
Industry 4.0 calls for new leadership skills and management commitments to Industry 4.0
projects. Management approval for big investment in newer technologies is necessary to
upgrade infrastructure suitable for Industry 4.0. Firms must not only focus on process
automation, quality systems and customers for better results but should also focus on
human capital development and change management to bring social sustainability.
Managers must also focus on horizontal and vertical integration for achieving firm’s digital
objectives. Good corporate governance no doubt is helpful for setting disciplines with
internal stakeholders but at the same time corporate set of rules, policies and actions plans
must be designed to fit Industry 4.0 requirements. Finally, the role of third-party audits and
its potential in bridging gaps in the Industry 4.0 project implementation should never be
ignored. Third-party audits actually help in proactively identifying various associated risks. Industry 4.0
Based on the audit report, managers may further develop action plans for risk mitigation in and supply
the supply chain network. chain
sustainability
5.2 Contribution to theory
The current study is grounded upon DCV theory and IT and further extends the Industry
4.0 knowledge base. The Industry 4.0 enablers identified in this study can be used in
multiple ways for future research.
5.3 Limitations, unique contribution and future research directions

The study showcases a very interesting topic for study and shows various gaps which actually
provide food for thought to future researchers. The uniqueness of the study is not only
reporting the review of relevant papers which presented evidence of Industry 4.0 and supply
chain sustainability concept but also identifying the 13 key Industry 4.0 enablers which
influence supply chain sustainability. Future study can be done on testing the framework
using data from South African manufacturing sector. Mathematical modeling can also be done
to estimate the impact of each Industry 4.0 enabler on supply chain sustainability. The study
can also be extended to see the moderation effect of Institutional pressures on Industry 4.0
effect on supply chain sustainability. Organizational information processing theory can also be
applied to study the Industry 4.0 effect on supply chain sustainability.
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Appendix
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BIJ Author(s), Year Research objectives Major findings Research gap(s)
Cardin et al. (2017) The study focusses on The paper presents a critical Uncertainties and risks
synthesizing the regular evaluation of different methods associated with dynamic
issues of intelligent and proposes a 2030 roadmap for business environment not
manufacturing the workgroup considered
Kusiak (2018) The study offers a vision The biggest problem faced by Social sustainability not
of smart manufacturing firms could be the change in the explored in depth
system. Factory automation will
be aided by the low-cost robotics
and this will open up new cyber
jobs. This type of cyber jobs
would require defining new job
descriptions and training of
workforce by institutes
Lee et al. (2018) The study propose an Based on the data collected from a The routing and storage
IoT-based warehouse case company, the proposed IoT- policies have not been
management system with based warehouse management discussed in details

an advanced data system shows that the warehouse
analytical approach using productivity, picking accuracy
computational and efficiency can be enhanced
intelligence techniques to
enable smart logistics for
Industry 4.0
Miranda et al. The study aims to fill the The development of a Optimization approaches
(2017) gap vis-à-vis the current reconfigurable micro-machine to the design and
lack of design roadmaps tool is presented as that of an S3 operationalization of new
that allows the product products not discussed in
development of this new details
generation of products in
“sensing, smart and
sustainable” S3
enterprises
Trab et al. (2017) This study provides The relevant deployment of The economic and social
advantages of the intelligence in a warehouse dimensions are not
communicating object in management system leads to considered
smart logistics and the propose a new concept called
design of a “IoT-controlled Safe Area”. This
communicating object concept allows preventing and
model inspired from controlling risky interactions and
Internet of Things dangerous situations on products
European research and human operators as well as
projects avoiding environmental disasters.
It can significantly contribute to
an effective safety assurance in
the WMS
Trappey et al. This study focuses on The research proposes a roadmap Economic, Social and
(2017) analyzing the related approach to visualize the patent Environmental
technology roadmaps for allocations and evolutions dimensions are not
the adoption of IoT corresponding to logistic services considered
technologies in smart at each level. Using the roadmap
logistic services methodology, the IoT-enabled
smart logistic patents are
analyzed to identify technology-
Table AI. related business strengths and
Summary of papers strategies
on Industry 4.0 and
sustainable supply
chain management (continued )
Author(s), Year Research objectives Major findings Research gap(s)
Industry 4.0
and supply
Garbie (2017) This study aims to The results show that students Course curriculum must chain
introduce the concepts of can be easily using sustainability be changed and upgraded
sustainability in concepts in engineering design simultaneously as per sustainability
industrial systems design courses. It can be observed from changes in business
and to reflect these students’ outcome that they are environment
concepts on designing willing and believing on
manufacturing systems sustainability that it is expected
to achieve the two out of
five student’s outcomes
(PEOs) in industrial
engineering program
Jabbar et al. (2016) A web-oriented In the proposed mechanism, the Low volume, high mix
architecture using REST smart warehouse consists of a product order picking not
framework is proposed to data collection module and an discussed. Safety,
enable warehouse objects administrative module security perspective is
to communicate over missing

the web
Watanabe, da The study focusses to The framework specifies how to Supply chain network
Silva, Tsuzuki, develop a framework for evaluate processes of SuPSs and complete business
Junqueira, dos the evaluation of considering their particularity processes is not
Santos Filho and production system and complexity, as well as their considered in the study
Miyagi (2016) performance considering balancing economic with the
sustainability indicators environmental aspects
Watanabe, da The study focusses to The proposed framework and the Supply chain network
Silva, Junqueira, develop a sustainable modeling process describe a and complete business
dos Santos Filho production system (PS) practical and systematized way of processes are not
and Miyagi (2016) framework assessing the performance of a considered in the study
sustainable PS by monitoring the
indicators defined in accordance
with four aspects of sustainability Table AI.
Corresponding author
Surajit Bag can be contacted at: surajit.bag@gmail.com
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Indian Institute of Management Sambalpur, Burla, India

1.1 Context and motivation

1.3 Research problem

2.2 Industry 4.0

Source of data collection Search syntax

Environmental Sciences (26.4%)

Seuring and Müller Department of International Management, Faculty of Organic 2,885

author’s affiliation (2008a, b) Witzenhausenkass, Germany

Source of data collection Search syntax

papers after Stage 5

2.3 Industry 4.0 and sustainable supply chain management

Kang et al. (2016) Department of Systems Management Engineering, Sungkyunkwan 84

corresponding Agarwal and Brem Otto-Friedrich-University, Bamberg, Germany 16

Industry 4.0 Sustainable supply chain management

“Industry 4.0” “Sustainable supply chain”

Source of data collection Search syntax

Search performed on ((TITLE-ABS-KEY (“industry 4.0”) OR TITLE-ABS-KEY (“industrial internet of

Social Sciences (20.8%)

Energy (22.6%) Figure 8.

Author(s), Year Corresponding author’s affiliation Citations

2.4 Defining key terms

2.5 Reporting the findings from literature review

2.7 Research questions

2.8 Research objectives

3. Industry 4.0 enablers of sustainable supply chain management and

3.2 Theoretical perspectives on Industry 4.0 and supply chain sustainability

Corporate Law and Policy

enterprises for sustainable development.

5.1 Managerial implications

5.3 Limitations, unique contribution and future research directions

Production, Vol. 142, pp. 3970-3984, doi: 10.1016/j.jclepro.2016.10.057.

environmental and economic competitiveness: a power perspective”, Transportation Research Part E:

sustainable product development (S3 product) reference framework”, International Journal of

and the Environment, Vol. 25 No. 4, pp. 241-260, doi: 10.1002/bse.1869.

pp. 2305-2324, doi: 10.1108/IMDS-10-2016-0419.

management system with based warehouse management discussed in details

to communicate over missing

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