Part 1: The Industrial Revolution – The Development from the Steam Engine to the Robot

By Yasemin Yazan

In order to better understand and classify the contexts of digitization and digitalization, I first address developments in the context of the so-called industrial revolution. In expert circles, we speak of industry 1.0 to 4.0 in this context. With this article you will get answers to the following questions:

1. Industry 1.0 to 4.0 – What is meant by it?
2. Industry 1.0 to 4.0 – Explanations & Differences!
3. Industry 1.0 to 4.0 – Relevance to the question of “How to Dominate your Market”

1. Industry 1.0 to 4.0 – What is meant by it?

Historically, there have been several pioneering technological advances that have massively changed the way people live. These industrial changes were characterized by a complex interplay of changes in technology, society, medicine, economics, education and culture.
Technological advances with a major impact on human living conditions are nowadays retrospectively divided into individual stages of development and phases: Industry 1.0 to Industry 4.0. The first industrial revolution was characterized by mechanization, the second by electrification, the third by automation and the fourth is characterized by informatization.

2. Industry 1.0 to 4.0 – Explanations & Differences!

Industry 1.0: Mechanization

The first massive technological advances took place in the late eighteenth and early nineteenth centuries in Britain, the United States and Western Europe. Therefore, this phase is called Industry 1.0. This phase was characterized by mechanical production based on water and steam power, especially in the industry of textile, iron and steel. Relevant inventions were the steam engine and the mechanical loom:
The mechanical production increasingly replaced heavy work that had previously been done manually. The machines used have made production faster and easier, thereby increasing the quality and quantity of the goods produced. After all, this revolution can not be discussed without mentioning the interconnected rails for the effective transport of the goods produced.

Social Impacts:

• Improvement of the population with basic goods
• Growth of population
• Reduction of classic crafts/classic agriculture
• Spread of urban life forms
• Exploitation of factory workers by factory owners
• Structural poverty of factory workers

Industry 2.0: Electrification

The Industry 2.0 has started around 1870 and was characterized by electrification and mass production based on electrical energy, especially in the electrical, chemical and automotive industries. Relevant inventions were the assembly line, electric railway for transportations and the telephone in the field of communication technology:
Industrialists began seeing possibilities of how to infuse technology into the machine to improve production. The steels were rolled out in their numbers; the rails were connecting cities and this was an important step for the globalization. The introduction of production line increased the number of industries during this period. To increase efficiency, the work was divided on the assembly line. This resulted in monotonous work that was not attractive. For this reason, wages rose, working hours fell and the principle of shift work was developed. Trade unions were founded and the emancipation of the workers grew.

Social Impacts:

• Growth of population
• Emergence of a prosperity society
• Increasing importance of trade unions
• Emancipation

Industry 3.0: Automation

This phase started around 1969 and was characterized by automated production based on Electronics and Information Technology (IT), especially in following fields: engineering, automotive, electronics, chemical, pharmaceutical and food industry. Relevant developments and inventions were computers, the Programmable Logic Controller (PLC), lean and series production:
For using mechanical and electrical machines, it usually needed an action by an operator. In contrast, automated machines can be remotely controlled by a system technology. With integrated small computers the machines are able to independently carry out a previously programmed work routine. With this technical progress, the production processes have been possible for lean and series production. Work steps have been simplified and human tasks and activities have been shifted to other areas such as administrative and creative work. This is why we are also talking about a shift from an industrial society through a service society to a knowledge society. At the same time, the increasing series production and global trade is intensifying competition.

Social Impacts:

• Increasing global trade
• Social market economy
• Decentralization
• Flexibility
• Emergence of a service and knowledge society
• Erosion of classic employment
• Changing market economies

Industry 4.0: Informatization

Welcome to the fastest growing era of industrialization yet known. We are just at the beginning of Industry 4.0, which is characterized by intelligent production based on increasing networking of small computers (embedded systems) with each other and with the Internet as well as the fusion of the physical and virtual world (Cyber Space) to so-called Cyber-Physical Systems (CPS), especially in industrial production, logistics and trade, healthcare, traffic management and smart systems:
So far, machines were not connected with each other and could not act autonomously. But now, the groundbreaking technical progress allows not only connections between machines but also connections between the internet of things (IOT) and manufacturing techniques. This way it becomes possible to enable systems to share and analyze information and use it to guide intelligent actions. It also incorporates technologies such as robotics and artificial intelligence, so that not only the exchange of information but also the learning ability of machines becomes true.

Social Impacts:

• Demographic change
• Lack of professionals
• Agility
• Work-Life-Balance
• Health Management
• High self-determination
• Sustainability

3. Industry 1.0 to 4.0 – Relevance to the question of “How to Dominate your Market”

If you look at the time spans between the different phases, you will notice that the developments between the individual phases of Industry 1.0 to 3.0 each took around 100 years. Compared to this the development from the 3rd to the 4th industrial revolution took only a few decades. This circumstance is due to the fact that technological progress has reached a stage in which the further development of progress has massively increased in speed. Experts therefore speak of an exponential development. Due to your brain being geared to thinking linearly, this exponential development is difficult to imagine – but it is there!

It’s easier to understand if you compare it to the compound interest effect. If you start saving money at an early stage and pay interest on it, it will have a much greater effect than saving a bigger sum later. You wouldn’t be able to catch up on that effect despite investing a larger sum, as growth is exponential.

Similar to this the exponential development in the area of technological advances creates effects and dynamics that compel companies to rethink and to transform themselves digitally. Conversely, hesitation endangers the existence of companies. Or in other words: Technological progress is rapid, and anyone who does not focus on this subject today, who doesn’t understand the background and does not transfer it to his own business, will, at some point, be unable to catch up – even if they would like to. Thoughts or notes such as “I’ll take a look at that later. That still has time.” is in this context existence-threatening for your business.


If you don’t keep up with the times, the times will leave you behind. Quelle, ToysRus, Blackberry and Kodak are some prime examples.

If you want to pioneer as an innovation leader in your industry and thus protect your company from being swept away by the digital tsunami that is still entirely underestimated then you have to start transforming yoursself and your company – better yesterday than tomorrow.

So take the opportunity today to go on my website and do a free “Digitization-Check” to test your knowledge. Because this is the first Step on the way to dominate your market. Within minutes you’ll get the results. And after you have done the test, as a special offer, you’ll also get the opportunity for a free 15 minutes online coaching session with me on top. In this I will show you what needs to be done next to advance your digital transformation.

But my time is limited – so this offer is limited. So do the test – quickly – and make sure you get one of the last free Online-Coachings for this year, which is the 2nd step on your way to dominate your market.

Do the Digi-Check now!

Do you want to get more insights from Yasemin about digitization, digitalization and digital transformation? Next Part is coming soon – so stay tuned. It is worth it!

© Image: Artram –