In the first part of our look at Industry 5.0, we explored the evolution of manufacturing processes, with a focus on the way in which Industry 4.0 technologies and processes have developed to make industry more efficient.
Yet for many firms, a blunt reality exists whereby industry leaders are tackling a pressing issue stemming from Industry 4.0 in that the promised digital transformation has failed to deliver on its promises – not because of technology, but because of human oversight. Companies are seeing that despite significant investments in automation and robotics, productivity has remained stagnant, skilled roles are going unfilled and employee turnover continues to rise.
Industry 4.0 promised a revolution in manufacturing, but designed to cut costs through automation, it has faced slow adoption and industry resistance. But was leaving people behind its biggest flaw?
People at the centre
In the Industry 4.0 era, engineers spent a lot of time focused on programming machines and analysing data, often spending a lot of time gathering information or tweaking parameters. Now, Industry 5.0 is shifting the focus back to the people – ensuring that technology empowers workers rather than complicating their jobs. It isn’t just a buzzword; it’s already taking shape.
When deployed effectively, Industry 5.0 can reinforce the value of human expertise in the engineering process rather than diminishing it. Its emergence could transform the roles of design and engineering teams, turning them into tech-empowered innovators, says Chris Brown, senior vice-president of sales at Fathom Manufacturing.
“The way we think about it is simple: humans at the centre, tech in the background…Engineers can devote far more time to creative problem-solving and high-level decision-making, rather than hunting down data or manually checking every detail. In other words, technology is keeping them out of the role of ‘librarians’,” he says.
“For example, a modern engineer might use an AI-driven system to instantly pull up relevant past project data or to automatically flag potential design issues, instead of spending days searching through documents or tapping on colleagues’ shoulders for tacit knowledge. This kind of ‘connected-worker’ approach, equipping engineers with real-time knowledge and digital support, enables them to interface seamlessly with machines, data and co-workers to boost efficiency and safety.”
The result is that engineers spend less time on drudgery and more time on innovation, using their expertise to make fast, smart decisions with the insights that technology feeds them. Asif Rana, president of Hexagon Nexus’ Connected Worker business concurs, noting that while Industry 4.0 focused on automation, data analytics and machine-to-machine communication, Industry 5.0 brings people back into the equation.
“It’s about creating smarter, more sustainable systems that are built around human collaboration, not just machines talking to each other. We see Industry 5.0 as the bridge between people and digital systems, helping people on the shop floor interact more easily with machines, software and data in real time. It’s a more human-centred approach to manufacturing. You can’t have human-machine collaboration without the digital foundation; automation, real-time machine data and connected systems are still crucial.”
CADDi – a provider of manufacturing systems designed to transform legacy drawings and supply chain data – also firmly believes that embracing a human-centric approach through industry is critical for manufacturing’s future. It warns of a danger approaching the industry in the form of a culture gap whereby manufacturing struggles to attract and retain talent not due to a lack of ability, but because workplaces remain hierarchical, rigid and disconnected from modern workforce expectations.
The company argues that technology should augment, not replace, human expertise, and that AI works best by enhancing workflows instead of adding complexity. It stresses that “real” results are possible with the right approach, with significant cost reductions from areas such as procurement made possible by adopting AI-powered technology designed around real people, not just around efficiency targets.
Asif Rana agrees: “Where Industry 4.0 was all about the technology itself, Industry 5.0 is about how we use that technology to make work better for people, creating value with those technologies and involving humans in a more sustainable, efficient way. It’s not just about optimising machines. It’s about improving workflows, supporting workers and creating long-term value for both businesses and society.”
Disruptive advantage
There’s also a deeper human element in greater efficiency in manufacturing, says Manish Kumar, CEO of engineering software and solutions developer SolidWorks. Talking to a client earlier in 2025, he asked what their company’s biggest challenges was – most in engineering would say, ‘Cost and time to market’, but not in this case, Kumar recalls.
“Their challenge was unique. They said, ‘We have a large population close to retirement, and once they retire, how do I capture what they know?’ So, I asked them, ‘How do you do it?’ They are asking everyone to convert what is in their heads in terms of documents processes, and it gets saved in a certain repository, in certain locations. So, how do you pass on that knowledge? Every time someone new joins, they are trained. There is onboarding training for people to know where to look [for information].
“But if I am working in your firm for a long time, if I look at some part which came out with a defect, I’ll be able to – as an experienced person – predict what happened and why that defect was there. [That is] because I know that certain conditions makes that kind of effect. If you’re a new person and saw that effect, how would you ask that question? There is no person around, and onboarding training is not going to give you that answer.
“A lot of clients of ours are in that situation where there is a lot of embedded knowledge and know-how in their workforce and [there’s a need] to extract that…How do you leverage that knowledge? To me, that is the biggest challenge, and that challenge is driving us to prepare the foundation of our generative experiences.”
Kumar says this extends from whether it is a manufacturing failure, or how to create drawings, or how to create parts, or previous assemblies. It is using all of that embedded knowledge to create the next generation of assembly. Kumar believes that his industry has reached a tipping point where all these different technologies can be combined to give what he calls “disruptive advantage” to clients – something that was just not possible until recently.
Moreover, he suggests that in working on AI, progress is going to be at a pace which firms will not be able to even predict. “As a CEO, my job is to be an optimist, but my fear is that my optimism is still going to be not fast enough,” he adds.
Kumar believes that companies will have to balance evolution with revolution in terms of the technologies and services they use. The key will be understanding the engineering problem precisely and then creating value.
The same challenge will be true for technology suppliers, suggests Rana: “Industry 5.0 has been pivotal in the design of Nexus. We’ve made key investments in technologies like generative AI to support this. Some of these tools work like digital co-pilots, helping workers do their jobs more easily across design, engineering, operations and quality. Others provide behind-the-scenes intelligence that makes digital workflows smarter and more connected. Because of this, our goals have expanded to go beyond general productivity.
“[We see] this as a continuous loop: capture, create, immerse, activate. Capture real-world data from machines and processes, create digital workflows that enhance how people and systems work, immerse teams in the data and tools they need to act confidently, and activate improvements in real-time across the shop floor.”
Challenges and champions
Despite its current usage and clear utility, there are still challenges to address before Industry 5.0 becomes widespread. Many manufacturers still don’t have a solid Industry 4.0 foundation, resulting in siloed data, tools that don’t talk to each other and a lot of processes that are still manual. There is also a technology solution landscape that is quite fragmented, made worse by a growing global skilled labour shortage making it harder for manufacturers to modernise at scale.
Hexagon’s Rana emphasises that the object should be to create “an autonomous connected ecosystem”, with self-learning expertise systems covering all stages of the manufacturing lifecycle, adding: “It’s about creating a system that works on three levels: automation, the Industry 4.0 layer; human-centric workflows, the Industry 5.0 layer; autonomous, self-learning systems, the next frontier.”
One challenge that may be rather underestimated in regards to data. Systems are only as good as the history you feed them. In manufacturing, a lot of data takes the form of PDFs as well as institutional and tacit memory or legacy file systems. Digitising that knowledge takes real time and effort, says Chris Brown.
“Even once the systems are ready, there’s the human element of trust,” he adds. “In our industry, especially in mid-sized companies, the humans with the deepest and most insightful knowledge are often the ones most hesitant to let go of being the ‘keeper of the answers’. That’s not a tech problem, that’s a change management problem. You have to show people that the technology is there to amplify their expertise, not diminish it. If you try to shortcut that step, the tools won’t stick, adoption rates will be low and you’ll be back to the thing that’s been harming this industry for 40 years – the little phrase, ‘That’s the way we have done things around here for years’.”
Another challenge involves people: that is, finding the right champions and discovering a way to measure just how much an improvement Industry 5.0 is. This kind of transformation needs more than a new software, it needs people inside the company who have, says Brown, the vision, credibility and communication skills to bring everyone together for the experience.
“Your first adopters aren’t just testers, they’re your internal champions, bringing people into the fold as the need arises and championing the solution in every challenge, they and their co-workers face,” he adds. “They make or break whether the broader team buys in. As for how we measure success, we track the usual suspects, speed to quote, design revisions, throughput and cost efficiency. But to me, those are trailing indicators. As an industry, we need to get out of the rear-view mirror and start looking out the windshield.
“The real leading indicator is how our engineers feel about their work. Are they spending more time doing what they’re great at and love? Are they more energised in design reviews and on calls with the companies’ customers? Are we seeing ideas surface that wouldn’t have before? When engineers are freed up to be engineers, and not librarians and firefighters, everything else improves with it – customers feel it, margins reflect it, culture thrives on it.”
In essence, to be a success, Industry 5.0 will not just be about smarter manufacturing or smarter production lines, it will be about more fulfilled, more effective people in industrial workplaces. If the appropriate technology is ready to serve the people, it’s now on companies to make sure it is deployed to make people more effective, building smarter, more adaptive operations tailored to their digitisation and business goals. In all, it’s about balance, using the technology to empower, not replace.
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