Today, the Industry 4.0 paradigm is necessary for companies to implement new operational and business models and transition toward a smart industry. Traditional production systems must evolve by incorporating digital technology, leveraging the Internet of Things, artificial intelligence, robots, information and communications technology, and big data to facilitate business transformation and improve the production lifecycle. This article presents a traceability system that optimizes processes through four phases of continuous improvement procedures: Initiation, Planning, Execution, and Closure. The proposed traceability system is designed to make the production process Industry 4.0-compliant. Results showed that the proposed system has led to a 99.97% reduction in the time spent on product traceability, resulting in an estimated annual savings of MXN 70 000 (USD \(\sim \) 3 500) in engineering overtime.