Journal of the National Research University Higher School of Economics

Manufacturers face increased cost pressure and market volatility. Product life cycles are getting shorter. Production has to be faster and increasingly local. The acceleration of "time-to-market" could happen thanks to the solutions of Industry 4.0 (I4.0), with supply chains morphing into highly adaptive networks with integrated entities. In this paper, we seek to exemplify the potential impact of I4.0 adoption upon the competitiveness of the firms (being foreign subsidiaries among others) and ask about the nature of modernization as part of the global value chain in which the enterprise operates. Our research based on four case studies reveals that the competitive advantage of a firm could be modified in the era of Industry 4.0 as a result of a sector's transformation and changing relationships with partners. These findings correspond with the literature stressing the uncertainty and complexity of the digital economy in general, as well as difficulties with the precise measuring of the expected benefits. The fourth industrial revolution emphasizes "the race to the top", giving priority to quality rather than cost reduction as a method of improving competitiveness and, since it implies the emergence of connected companies, truly linked with each other, the disappearance of clear boundaries between them.