Both technological advances and globalization are driving the transformation of the manufacturing sector. In fact, this sector is undergoing a total overhaul with new Industry 4.0 technologies such as blockchain’s distributed ledgers, industrial Internet-of-Things (IoT), and Artificial Intelligence (AI). Each technology plays a unique role in the sector’s transformation:


● IoT: Industrial IoT is where data exchange begins. Industrial IoT allows companies to interact with their technologies and assets, extracting more value from them.

● Blockchain: The technical backbone upon which IoT data exchange occurs. Blockchain adds a layer of security and trust when sharing data with others.

● AI: Artificial intelligence automates processes and decision-making with machine learning, which increases efficiency, saves time, and reduces costs.

Internet of Things

IoT is already mainstream and smart sensors are quite affordable today. Converting “dumb devices” to “smart devices” that can be monitored and remotely controlled enables automation where time-consuming expensive manual processes were previously needed.

Interconnected devices can alert supply chain managers whenever something goes wrong, even minor defects that would otherwise be found only after a thorough inspection or worse, a costly recall. Manufacturers can interact and communicate with smart devices to automate certain activities that previously required manual labor, especially in poor or unsafe working conditions.

This technology has been around for a while, but falling costs made it a “no-brainer” for manufacturers to leverage IoT. However, leveraging IoT doesn’t just mean adding internet connectivity to factory equipment and calling it a day. Manufacturers need a secure network to communicate with these devices. Network security is where IoT and blockchain converge, because adding internet connectivity to devices opens them up to manipulation, sabotage, and cyberattacks.

Blockchain Technology

Although blockchain is new, it is beginning to mature withenterprise use cases becoming more feasible by the day. Blockchain provides a foundation for IoT devices to securely share information with other interconnected devices, manufacturers, partners, and end customers without falling victim to botnets, man-in-the-middle attacks, data theft, social engineering, and DDoS.

Because blockchain ledgers are distributed, having multiple partners and suppliers tell you that a piece of data is accurate gives you more confidence as opposed to being forced to trust a report from a single supplier or factory.

Therefore, blockchain adds a layer of trust that would not be possible with direct reporting or centralized databases. This extra layer of trust allows manufacturers to operate more confidently and bring better service to customers and partners.

Artificial Intelligence

AI helps manufacturers optimize shop-floor operations, thereby “reducing supply chain forecasting errors by 50% and lost sales by 65% with better product availability is achievable with machine learning.” (Source: Forbes)

Along with IoT devices, AI increases detection of defects by 90%, preventing bigger problems such as product recalls. Manufacturers and supply chain managers can streamline workloads using AI by improving visibility into assembly and supply chain processes. A clear real-time view of supply chain and assembly processes makes it possible for manufacturers to coordinate and plan with greater precision and less waste.


While IoT, blockchain, and AI technologies have been used by other sectors, the manufacturing sector is where all of these technologies converge to drive its own digital revolution. To learn more details about how blockchain works with manufacturing, check out our information resources including ARXUM fact sheets, pitch deck, and white paper.