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Industry 4.0 becomes global trend for world government, it is because not only affected to manufactures increasing the productivity but also to social economics and education. Small Medium Industry (SMI) is the largest number of industries and one of the backbones in Indonesias economy, but they are slow in adopting the technology, so it is considered irrelevant to industry 4.0. This paper analyzes the SMI readiness index in industry 4.0. The readiness results is simulated in the model to provide policy alternatives for the government to implement industry 4.0 in SMI.