Technology in itself does not have the power to transform if it is implemented in isolation from a well-guided strategy. Conversely, technology and assets are leveraged by improved planning and regular status checks.

We already know some of the advantages of implementing Industry 4.0, such as increased efficiency and productivity, reduced errors, and improvements in flexibility and quality. In addition to the aforementioned benefits, Industry 4.0 also creates the possibility of exploration of new business areas. From this opportunity arises the need to define the investment balance between incremental innovation and radical innovation.

• A incremental innovation refers to leverage the existing business model, looking for improvements in existing products by building capabilities and resources to manage the present (short-term organizational goals and to face current competition).
• A radical innovation é more disruptive and seeks to create new business models, through the inclusion of new technical skills to manage the future (strategic goals and competitive advantage vis-à-vis future competition).

So what direction should you go? It is up to each company to define the allocation of resources for each of these initiatives.

Should it have a more conservative approach and bet more on incremental innovation? Or take the risk and invest your resources in radical innovation? In general, there is no need to allocate all resources to one approach. At the end of the day, it's best to strike a balance between the two approaches.