Rapidly arriving futures: Future readiness for industry 4.0

Abstract

The future being shaped by Industry 4.0 has arrived. Tools are available that anticipate the future, approximate it, estimate it, and select a preferred future; but do we know how to make disruptive futures part of our business and lives? Building on technology readiness levels and manufacturing readiness levels, future readiness levels and a future readiness index are suggested in this paper. The future readiness levels (FRL) are based on readiness at the capability levels of technology, behaviour, event, and future thinking. A future readiness index (FRI) is then determined, based on the entire future thinking space (technology, behaviour, events, and capability to do future thinking). Once the FRL and FRI are known, it will become clear what strategic interventions are required to thrive in a preferred future. The existing and desired situations in future readiness are compared, and the gaps are addressed. This approach provides a tool for the internal monitoring and evaluation of the state of the organisation to remain sustainable and competitive in a future that is fast arriving; to compare organisations competitively in a similar cluster; to benchmark at industry level; and ultimately to have the potential to measure the future readiness of nations. © 2018, South African Institute of Industrial Engineering. All rights reserved.

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South African Journal of Industrial Engineering November 2018 Vol 29(3) Special Edition, pp 148-160
148
RAPIDLY ARRIVING FUTURES: FUTURE READINESS FOR INDUSTRY 4.0
A.P. Botha1,2*
ARTICLE INFO
Article details
Presented at the 29th annual conference
of the Southern African Institute for
Industrial Engineering (SAIIE), held from
24-26 October 2018 in Stellenbosch,
South Africa
Available online 9 Nov 2018
Contact details
* Corresponding author
anthon@technoscene.co.za
Author affiliations
1 Department of Engineering and
Technology Management,
University of Pretoria, South
Africa
2 TechnoScene (Pty) Ltd, South
Africa
DOI
http://dx.doi.org/10.7166/29-3-2056
ABSTRACT
The future being shaped by Industry 4.0 has arrived. Tools are
available that anticipate the future, approximate it, estimate it,
and select a preferred future; but do we know how to make
disruptive futures part of our business and lives? Building on
technology readiness levels and manufacturing readiness levels,
future readiness levels and a future readiness index are suggested
in this paper. The future readiness levels (FRL) are based on
readiness at the capability levels of technology, behaviour, event,
and future thinking. A future readiness index (FRI) is then
determined, based on the entire future thinking space (technology,
behaviour, events, and capability to do future thinking). Once the
FRL and FRI are known, it will become clear what strategic
interventions are required to thrive in a preferred future. The
existing and desired situations in future readiness are compared,
and the gaps are addressed. This approach provides a tool for the
internal monitoring and evaluation of the state of the organisation
to remain sustainable and competitive in a future that is fast
arriving; to compare organisations competitively in a similar
cluster; to benchmark at industry level; and ultimately to have the
potential to measure the future readiness of nations.
OPSOMMING
Die toekoms wat deur Industrie 4.0 bepaal word, het aangebreek.
Metodes is beskikbaar om die toekoms te antisipeer, dit te benader,
dit af te skat en ’n gekose toekoms te kies; maar weet ons hoe om
ontwrigtende toekomste deel van ons besigheid en lewens te maak?
Deur voort te bou op tegnologiegereedheidsvlakke en
vervaardigingsgereedheidsvlakke, word toekomsgereedheidsvlakke
en ’n toekomsgereedheidsindeks in die artikel voorgestel.
Toekomsgereedheid is gebaseer op gereedheid op die tegnologie,
gedrag, gebeurtenis en vermoë tot toekomsdenke vlakte. Die
gereedheidsindeks word bepaal deur die totale toekomsdenke
ruimte. Wanneer die gereedheidsmetings beskikbaar is, kan daar op
strategiese ingryping besluit word, wat sukses in die toekoms sal
bepaal. Bestaande en verlangde toekomsgereedheid kan bepaal
word en die gapings tussen hierdie toestande kan aangespreek
word. Die benadering verskaf ’n metode vir interne monitering en
evaluering van die toestand van die organisasie wat dit in staat stel
om kompeterend te bly in ’n toekoms wat vinning naderkom, om
kompeterende vergelyking te doen van organisasies in soortgelyke
besigheid, om op industrievlak te vergelyk, sowel as om,
uiteindelik, na die toekomsgereedheid van nasies te kyk.

149
1 INTRODUCTION
Industry 4.0 can be classified as a rapidly arriving future. Until recently, it was a phenomenon of
the distant future; but in the past three years it has been taken up in many facets of the
manufacturing and service industry value chains. During the introduction phase, various definitions
of Industry 4.0 have been provided, with two interesting ones quoted here: “end-to-end digitisation
of all physical assets and integration into digital ecosystems with value chain partners” [1], and “all
digitally enabled disruptive technologies that are likely to have a significant impact on
manufacturing within the next 10 years” [2]. While newly adopted Industry 4.0 principles and
processes may still be conceptualised, and agreement on exactly what is required to be successful
has not been reached, strategies for Industry 4.0 are the order of the day. Strategic planning has
been supported by tools such as technology readiness levels (TRLs) [3] and manufacturing readiness
levels (MRLs) [4]. The question arises: How can one be future-ready, specifically for Industry 4.0?
This is a thought-leading paper in which a conceptual model for future readiness is proposed. This
model manifests itself in suggested future readiness levels (FRLs) and a future readiness index (FRI).
2 BACKGROUND AND LITERATURE
2.1 Fourth Industrial Revolution maturity models
Several Industry 4.0 maturity models have been suggested in the literature [5]. These include
dimensions of:
 strategy and organisation, smart factory, smart operations, smart products, data-driven
services, and employees [6]
 a process model for the realisation of Industry 4.0, gap analyses, and a toolbox for overcoming
maturity barriers
 an on-line self-assessment tool for understanding Industry 4.0
 a connected enterprise maturity model, based on a five-stage approach to realise Industry 4.0
— viz., assessment, secure and upgraded network and controls, defined and organised working
data capital, analytics, and collaboration [7].
The maturity model proposed by Schumacher, Erol and Sihn [5] includes dimensions of strategy,
leadership, customer, products, operations, culture, people, governance, and technology. Most of
these approaches depend on the notion of a maturity model and not on an assessment of readiness.
Maturity, in applying a new paradigm such as Industry 4.0, can only be achieved once there has been
consistent operation in the environment for a considerable time. Industry 4.0 is just too young for
that. This is why the focus in this paper is shifting to readiness measurement, where an assessment
of readiness can be made for aspects of a new future that is still arriving, often at a rapid pace. This
type of measurement is done within the framework of future thinking.
2.2 Future thinking
The future cannot be predicted, yet it is also not pre-determined. Future thinking is an integrated
and holistic approach that looks at the future and what opportunity it holds [8-11]. It addresses four
levels of futures: a possible future, a plausible future, a probable future, and a preferred future. It
is aimed at strategic visioning, and includes the methodology of back-casting to determine strategic
interventions in the present to manage the present from the future. Future thinking processes look
at the future in the context of future shaping factors: technology (not science fiction, but
technologies that are recognisable in the research and development phase); the behaviour of people
(in the marketplace and workplace); and events that change the world (geopolitical events, natural
events, economic events, and demographic and social shifts — predictable and unpredictable,
avoidable and unavoidable). A triangle spanned by technology, behaviour, and events is drawn as a
future thinking space (Figure 1). The relevance of the future-shaping factors is determined by their
impact and probability; and the factors are categorised as emerging (high probability, low impact),
disruptive (high probability, high impact), wild cards (low probability, high impact), and weak signals
(low probability, low impact). This thought model is used to determine inter-factor influences that
lead to scenarios of multiple futures. A preferred future can be selected, and a strategy can be
shaped to reach that desired state in the future.

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Figure 1: The future thinking process (Source: [8 - 11])
2.3 Readiness levels
The use of technology readiness levels and manufacturing readiness levels has been accepted
technology and engineering management practice for some time [12]. These levels are still being
developed, and recently, a tenth technology readiness level was added by NASA [13]. A summary of
the accepted technology readiness levels used at present is shown in Figure 2.
Figure 2: Technology readiness levels used in technology management (Source: [13])
Although the scale of the levels may be described as moving towards maturity, it is argued in this
paper that maturity measurement can only begin once proven operations have been demonstrated.
Likewise, a scale of manufacturing readiness levels [4] is provided in Figure 3.

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Figure 3: Manufacturing readiness levels used in technology management (Source: [4])
The MRLs are inherently dependent on the TRLs, since manufacturing technology is applied. The
question arises: How do these readiness levels hold in Industry 4.0, and how should they be supported
by a future readiness measurement for a rapidly approaching paradigm shift in many industries?
3 RESEARCH METHODOLOGY
In this research, FRLs and an FRI were postulated and tested with a group of respondents who work
in industries or policy environments where Industry 4.0 has already made an impact. The respondents
were asked to validate the FRLs suggested, and to place them in the context of the future thinking
approach and the rapidly deploying Industry 4.0. The respondents were also asked to comment on a
future readiness audit, measurement methodology, and process, as well as maturity levels for future
thinking capability. The results were analysed and conclusions were derived from the synthesis.
4 CONCEPTUAL FUTURE READINESS MODEL
Building on TRLs, MRLs, and capability maturity models (CMMs), future readiness levels (FRLs) and a
future readiness index (FRI) are proposed. The FRLs are based on readiness at the technology,
behaviour, and event dimensions of the future thinking space and future thinking capability. A set
of future readiness levels has been defined for each of the future shaping factors (technology,
behaviour, events), and for future thinking capability. A methodology to conduct a future readiness
audit and assessment is suggested. In the calculation of this rating, the importance of an FRL is
determined and the state of its implementation is quantified. A future readiness factor (percentage
readiness) is subsequently calculated. An FRI is then provided, based on the contribution of these
individual future readiness factors for the entire future thinking space and the future thinking
capability. This approach provides a tool for the internal monitoring and evaluation of the state of
the organisation to remain sustainable and competitive in a future that is fast arriving; to compare
organisations competitively in a similar cluster; to benchmark at industry level; and ultimately to
have the potential to measure the future readiness of nations.
4.1 Future readiness levels (FRLs)
The following FRLs were postulated and tested among respondents. The levels indicated were all
deemed essential to the model, and are arranged in order of the achievement necessary to proceed
upward on the readiness scale.
4.1.1 Technology future readiness levels (TFRLs)
The TFRLs shown in Figure 4 are based on the technology management approaches that are required
for emerging, disruptive, wild card, or weak signal technologies in a specific environment — in the
case of this paper, for Industry 4.0.

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Figure 4: Technology future readiness levels
4.1.2 Behaviour future readiness levels (BFRLs)
Market behaviour future readiness levels
Figure 5: Market behaviour future readiness levels
The BFRLs shown in Figure 5 are related to the behaviour that is external to the enterprise and
focused on the market. It addresses the user revolution, market dynamics, and adoption patterns,
among others.
Enterprise behaviour future readiness levels
Figure 6: Enterprise behaviour future readiness levels
In Figure 6, BFRLs relating to the behaviour inside enterprises are shown. These refer to the changing
demographics in the workplace, the work space, and the inevitable interaction between humans and
intelligent machines in Industry 4.0.
4.1.3 Event future readiness levels (EFRLs)
Figure 7 indicates EFRLs that are deemed necessary to become future ready. They address the ability
to do event spotting, and to make sense of the emergence of these events. The ability to position
business within the context of these events is critical.
4.1.4 Future thinking readiness levels (FTRLs)
The ability to do proper future thinking contributes to the level of readiness for the future. These
aspects, highlighted and sequenced in Figure 8, deal with future thinking skills that have been
identified as essential [8-11] and the methodology and approach provided in Figure 1. The ability at
the various levels is measured in terms of the adoption of future thinking skills that individuals
develop through exposure to future thinking methods, and their application of these methods in day-
to-day tasks.

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Figure 7: Event future readiness levels
Figure 8: Future thinking readiness levels
4.2 FRL audit and assessment
With a preferred future constructed or a disruptive one dawning, the next question is: How will the
readiness of the preferred future be measured using the readiness levels mentioned above? The
answer lies in a future readiness audit, and using the audit units of measurement to construct a
visual representation of future readiness.
4.2.1 FRL audit
The following questions are important in a future readiness audit:
 Do we know what the activities in our organisation are to sustain the future readiness level in
our organisation?
 Can we identify the location within the organisation where the activities take place?
 Do we know the scale of the activities that enable our future readiness levels (organisation-
wide; departmental; group; individual)?
 Can we identify the documents/procedures/policies that give evidence of our future readiness
levels?
 Can we name individuals who have responsibility for upholding the future readiness level?
4.2.2 Future readiness mapping
The matrix presented in Table 1, consisting of the FRLs and the audit units of measurement, form a
mapping of the future readiness. They should be populated with the information for the organisation
by:

154
a. Listing activities that are in place
b. Pinpointing the location(s) of the activities within the organisation
c. Stating the scale of the activities related to the future readiness levels
d. Listing all relevant documents (strategies, policies, reports, white papers, minutes, guidelines,
rules, etc.)
e. Listing the names and contact details of individuals involved in the activities, their location,
responsibilities, authority, etc.
This matrix is completed following preparation by the organisation of a detailed breakdown of the
strategies, policies, processes, and documents in the organisation that need to be included in the
audit and assessment, as well as identifying the activities, location, and individuals that are critical
to these readiness levels. A summary is shown in Table 1.
Table 1: Example of a future readiness matrix
FRL
Readiness
expression
Activities
Location
Scale
Documents
Individuals
TFRLs
(all to be listed)
(from Fig 4)
Refer to (a)
above
Refer to (b)
above
Refer to (c)
above
Refer to (d)
above
Refer to (e)
above
BFRLs
(all to be listed)
(from Fig 5 & 6)
Refer to (a)
above
Refer to (b)
above
Refer to (c)
above
Refer to (d)
above
Refer to (e)
above
EFRLs
(all to be listed)
(from Fig 7)
Refer to (a)
above
Refer to (b)
above
Refer to (c)
above
Refer to (d)
above
Refer to (e)
above
FTRLs
(all to be listed)
(from Fig 8)
Refer to (a)
above
Refer to (b)
above
Refer to (c)
above
Refer to (d)
above
Refer to (e)
above
4.2.3 FRL assessment
The understanding that follows from the audit and mapping of future readiness units of measurement
is then applied, and a rating is provided for the importance (high, medium or low; or any other
chosen scale) of any particular level for the enterprise for which the future readiness assessment is
done, and the state of readiness (ready, in progress, unprepared, or another chosen scale) based on
the audit and mapping. This assessment, using the relative scores for the various levels, is then done
in the enterprise and among its external stakeholders (shareholders, clients, suppliers, partners,
influencers, facilitators, etc.). These are all entities upholding the future readiness. The calibration
of the scales is up to the organisation or its industry in which it operates. For benchmarking, there
needs to be conformity; for internal measurement, performance indicators are agreed that can be
measured, or consensus is reached. The outcome of the assessment is illustrated in Table 2.
Table 2: FRL assessment
FRL
Readiness
expression
Importance
State
TFRLs
(all to be listed)
(from Fig 4)
High,
medium, or
low
Ready,
in progress,
unprepared
BFRLs
(all to be listed)
(from Fig 5 & 6)
High,
medium, or
low
Ready,
in progress,
unprepared
EFRLs
(all to be listed)
(from Fig 7)
High,
medium, or
low
Ready,
in progress,
unprepared
FTRLs
(all to be listed)
(from Fig 8)
High,
medium, or
low
Ready,
in progress,
unprepared
Visualisations of the outcome of the future readiness assessment, in the form of radar diagrams, are
given in Figure 9 to Figure 12.
The ratings are done on a relative scale from 0 to 3. The assessment of the ratings is based on an
external benchmark, or on an internally defined scale that can be measured, or when consensus is
reached on the status vs the ideal.
The importance levels should all remain at maximum if a benchmark is to be done among various
divisions in the enterprise or industry. It may, however, be possible for the importance of the FRLs
to vary in an environment where the future readiness assessment is being introduced. Such a case
for the BFRLs is shown in Figure 10.

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An example of the EFRL assessment is shown in Figure 11.
This visual representation provides a quick view of where the gaps are for improvement that can be
addressed through strategic or policy intervention. It reveals the future readiness levels that need
attention for improvement. By repeating this exercise in the enterprise, monitoring and evaluation
of the progress towards future readiness can be established.
An illustration of the state of future readiness in future thinking capability is shown in Figure 12.
Figure 9: Illustration of the state of future readiness based on TFRLs for an enterprise,
following an FRL assessment (all importance levels at maximum) (see online version for colour)
Figure 10: Illustration of the state of future readiness based on BFRLs for an enterprise
(market - external and enterprise - internal), following an FRL assessment (importance levels
varying) (see online version for colour)

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Figure 11: Illustration of the state of future readiness based on EFRLs for an enterprise,
following an FRL assessment (all importance levels at maximum) (see online version for colour)
Figure 12: Illustration of the state of future readiness based on FTRLs for an enterprise,
following an FRL assessment (all importance levels at maximum) (see online version for colour)

157
4.3 Future readiness index (FRI)
Once all the FRL assessments for the future shaping factors and future thinking capability have been
done, an integrated view of the state of future readiness is possible. This is expressed through a
future readiness index (FRI). The FRI is calculated as an average of the outcomes of the TFRLs,
BFRLs, EFRLs, and FTRLs. An illustration is given in Table 3.
Table 3: Calculating the FRI from the overall FRL outcomes
FRL
% Readiness
(first assessment)
% Readiness
(second assessment)
TFRL
70
90
EFRL
57
80
FTRL
47
75
BFRL
63
70
FRI
59
79
To monitor progress towards improved future readiness, regular future readiness audits and
assessments can be done. The outcomes of the first assessment are then compared with those of
subsequent assessments, and the direction and speed of change of the FRI are used to intervene
strategically to push the enterprise to the desired level of future readiness. The same can be done
for an industry or a nation. This makes the FRI an equivalent parameter to an R&D index, an
innovation index, or a competitive index.
Figure 13 illustrates the visualisation of an FRI that was measured using the examples given above,
and a subsequent one to indicate growth along the FRL dimensions.
Figure 13: Future readiness index based on performance against FRLs
5 VALIDATION
The concepts used in the conceptual future readiness model discussed above were validated in a
survey.
5.1 The survey respondent profile
The survey was conducted among respondents who included business owners, board members, C-
suite executives (CEO, COO, CTO, etc.), senior management, project managers, researchers,

158
academics, and government officials. Thirty-six respondents provided their inputs. The age
distribution was from 20 to over 60, with the majority (39%) of the respondents being between 51
and 60 years of age, followed by an almost equal spread between 31 and 40 and between 41 and 50.
About 15 per cent of the respondents were over 60 years of age. Ninety-four per cent of the
respondents indicated that they are often confronted in their work context with the need to make
decisions about the future. Eighty-six per cent of the respondents had previously worked with TRLs,
31 per cent with MRLs, and 36 per cent with capability maturity model integration. This indicates
that the majority had worked with readiness levels of some kind, and some of them with more than
one type.
5.2 The FRLs
There was agreement that the FRLs, as presented in the conceptual model, were relevant. The
levels that were tested for each of the TFRL, BFRL, EFRL, and FTRL were deemed essential and
important. Very few of the levels presented to be evaluated were seen as marginal, and only a few
of the EFRLs were considered ‘not required’ by a minority of the respondents. This validates the
choice of FRLs presented in this paper. The respondents were not asked to provide the sequence of
measurement as outlined in the conceptual model. This sequence is part of a natural development
and learning process suggested by the author.
5.3 The FRL audit questions
The respondents were asked to validate the audit questions suggested in the conceptual model
(section 4.2.1). Agreement with all the questions was above 70 per cent. Only the question about
identifying documents/procedures/policies that provide evidence of future readiness levels was
supported by just under 60 per cent of the respondents.
6 FUTURE SHAPING INFLUENCES FOR INDUSTRY 4.0 READINESS
Respondents were asked to rank future shaping influences (technology, behaviour, and events) that
will guide the measurement of future readiness for Industry 4.0. The influences are illustrated in
the future thinking space in Figure 14 in the order of importance revealed by the research.
When thinking of future readiness for Industry 4.0, these factors must be considered closely, and an
assessment must be made on future readiness to deal with those that will impact the core business
of an enterprise. This mapping of the ten prevailing influences on each future influencing factor
(technology, behaviour, events) for Industry 4.0, and the perception of the respondents of the
importance of each, will have to be borne in mind when considering readiness for the era of Industry
4.0.
7 CONCLUSIONS
A conceptual model for future readiness measurement was presented in this paper. Future readiness
levels were introduced along the line of technology and manufacturing readiness levels. An approach
was presented on how to audit the enterprise for future readiness, and on how to make an
assessment at the level of technology, behaviour, and events as future shaping factors in the future
thinking space. There is limited literature on the measurement of future readiness, and most articles
address maturity model approaches. It is argued in this paper that a maturity assessment may follow
an initial future readiness assessment based on readiness levels, as outlined. The FRI that is proposed
is a useful indicator of progress towards future readiness at enterprise (organisation), industry, and
national level.
The research paid specific attention to applying future readiness measurement in Industry 4.0 as a
fast-approaching era. The future shaping factors for Industry 4.0 were validated and ranked in terms
of their importance. This provides a view of the technologies, behaviours, and events that
enterprises need to get under control when they venture into the Industry 4.0 paradigm. The
opinions of survey respondents were probed about adopting a future readiness approach. Feedback
indicated that scepticism and practicality will be a hindrance to applying future readiness

159
Figure 14: Future shaping factors that determine the readiness for Industry 4.0 (ordered from
high impact to low impact)
measurement. Since it is closely associated with future thinking capabilities, a skill that is not well
developed in executive and senior management, the adoption of FRLs and future readiness
assessment processes may be slow.
This lethargy is exacerbated by the fact that the future will most probably see big companies
leveraging existing assets and management approaches. Many entities will be faced with the
question of what else to do with their assets, rather than aligning them with Industry 4.0. To a large
extent, there is a spirit of denial and avoidance of Industry 4.0 among older industries, as a radical
new wave and gradual migration towards applying Industry 4.0 philosophies is expected, rather than
a rapid and abrupt change. One of the greatest problems with adopting a highly dynamic
environment is that people become reactive rather than pro-active. Attention should be given to
developing decision-makers and managers to lead and guide the action and to deal with it adequately
and efficiently to maximise opportunities arising from it. The focus is often on correcting
inefficiencies and chasing existing opportunities to improve what is currently being done in
organisations, instead of chasing new trends and losing the opportunity to add value with what is
known.
Regardless of these barriers to progress, future readiness measurement provides a way to assess the
impact of a rapidly arriving future to both those who are conservative about change and the
proponents of rapid progress. For both, a method is suggested to measure their readiness for
transition from a known era to one that is new and exciting, but unknown. Decision-making can now
be done on a thorough future readiness assessment, making use of FRLs, and informed decisions can
be taken on the pace of change or adoption of Industry 4.0 philosophies and processes. The adoption
of a future thinking mind-set within organisations requires buy-in from various levels, but it is often
opposed because the concepts are not understood; hence the fear of the unknown becomes a
stumbling block. Future readiness measurement provides a handle on this uncertainty, and may be
the catalyst for adopting future thinking.

160
Eventually, all organisations - regardless of the industry in which they operate, and where they
contribute to the value chain - need to adapt to Industry 4.0 factors that shape and influence their
environments, and need to condition their human resource assets to embrace the technological
revolution.
8 RECOMMENDATIONS
This research paper is of a conceptual nature. The FRLs suggested and validated in the preliminary
research reported on must be tested in practice to confirm, modify, and improve them. The audit
and assessment processes need to be applied to judge their practicality. Further research is required
on the transition between the use of readiness levels and maturity models. Solid academic debate
and pro-active industry application is required. It is recommended that the ideas communicated in
this paper be scrutinised in academic debate, and be taken up by technology and engineering
managers to start preparing their organisations for entering Industry 4.0. The emergence of Industry
4.0 is unavoidable; it has arrived, and it is influencing the way business is conducted in a broad
context. Denying it will not mean escaping it. Getting a handle on readiness to become involved in
a future phenomenon is a crucial skill, and the tools suggested may be the beginning of making it
possible for organisations not only to survive, but also to thrive, in Industry 4.0.
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