In recent years, the global industry has become a strong competitor for the industry in Europe. It is not enough to produce faster, cheaper and with higher quality than the competition, to defend the achieved competitive advantage. Smart Manufacturing for SMEs definitely is the right way to achieve such an advan- tage. In order to do this, several related challenges have to be overcome. Trend of manufacturing industry – towards individualization; complexity driven, Industry 4.0 or Smart Factory is a network of smart objects (Illustrative Fig. 1). One of the challenges is to produce lot-size=1, with the efficiency of a highly automa- ted mass-production system. To enable Industry 4.0, opportunity is in the Internet of Things (IoT). IoT is the techni- cal vision to integrate objects of any kind into a universal digital network. The objects have a unique identity (smart objects) and are located in a smart environment. Since Industry 4.0 is not a finished product – it has to be developed idividually to each SME as there are (nearly) no established methods, procedures or criteria for imple- menting Industry 4.0.