Digital transformation implies changes in organizations through application of digital technologies to enhance existing or develop new processes. One of key features of digital technologies is the development of smart systems, whereby, when considering the manufacturing sector, traditional factories are transformed into smart factories. This article defines smart factories, explains main approaches to transform from traditional to smart and investigates the implementation of digital technologies in smart factory processes involved. The research aims to integrate and extend different approaches to transformation as well as to show how factories should use the digital enablers to benefit and improve their work.