Industrie 4.0 for circular value creation – How digital technologies are driving the circular economy in industry

Munich, 02 July 2026

In the new report ‘Industry 4.0 for Circular Value Creation’ published by the Research Council Industrie 4.0, the Institute for Production Management, Technology and Machine Tools (PTW) at Darmstadt Technical University demonstrates how digital technologies can support companies in implementing the circular economy. The report examines the current use of Industrie 4.0-technologies, their added value for circular value creation processes, as well as existing barriers and areas where action is needed. These technologies are regarded as key enablers for the circular economy, as they facilitate the collection, analysis and exchange of data throughout the product life cycle.

Given the dwindling resources and increasing sustainability requirements, companies are faced with the challenge of gradually transforming their previously predominantly linear value creation processes into circular value creation systems. However, there is a lack of robust evidence on how Industrie 4.0-technologies are being used in industrial practice and what contribution they actually make to the implementation of circular value creation processes.

 

“For me, circular value creation is the North Star,” explains Gisela Lanza (Karlsruhe Institute of Technology and wbk Institute for Production Engineering), a member of the Research Council Industrie 4.0. “We will only reach it when our dominant economic model is truly circular and does not merely operate in a niche, as is the case today.”

 

 

 

Digital transparency as the key to circular value creation

Generally speaking, it can be observed that large enterprises use Industrie 4.0-technologies significantly more frequently than small and medium-sized enterprises. The study shows that, regardless of company size, traceability technologies and sensor technology are most commonly used in machinery or products. The companies surveyed rate digital technologies as particularly valuable in the areas of production control, quality testing and product usage. Existing condition and usage data can help to analyse and process returned products more quickly. It is also striking how important companies consider applications involving artificial intelligence to be in the future. The administrative layer, by contrast, has so far played only a minor role. At the same time, it is evident that remanufacturing is currently rarely supported by data, even though there is considerable potential for the use of digital technologies in this area in particular.

The main obstacles relate to data and regulation

Despite the positive potential of digital technologies, the study also highlights significant challenges in implementing circular value creation processes. Companies cite, in particular, the limited availability of supply chain data, an unclear legal framework and complex approval and certification requirements as key obstacles. Especially small and medium-sized enterprises are also faced with limited human resources, a lack of specialist knowledge and high bureaucratic requirements.

Recommendations for action for business, academia and policymakers

For businesses, a phased approach to adopting Industrie 4.0-technologies for circular value creation processes is recommended, with special potential lying in the development of data ecosystems and the use of artificial intelligence and data analytics. A practical guide provides specific recommendations on how these technologies can be gradually put to use, thereby filling an important gap, particularly for SMEs, which often lack the necessary know-how for implementation. To ensure this transition is successful, funding initiatives should complement this by offering companies low-threshold support services and practical guidance on the introduction of Industrie 4.0-technologies. At the political level, too, the necessary conditions must be created to promote the transition towards circular and digitally supported value creation.

The report is available to download for free from the Research Council’s website.

About the PTW

The Institute for Production Management, Technology, and Machine Tools at the Technical University of Darmstadt conducts research and develops innovative solutions for the future of manufacturing. Its focus is on efficient, sustainable, and resilient value-creation systems, as well as the intelligent use of digital technologies in industrial practice.