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New Industrial Revolution Revealed: High Tech Heaven or Hell?

Trends Tech Business

Klaus Schwab, Founder and Executive Chairman of the World Economic Forum tells us that we are standing “on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before. We do not yet know just how it will unfold, but one thing is clear: the response to it must be integrated and comprehensive, involving all stakeholders of the global polity, from the public and private sectors to academia and civil society.”
Going back in time, the First Industrial Revolution powered machanised production with steam, the Second used electric power and the Third used electronics and information technology to automate production. “Now a Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.”

The vast global population is ever more connected through mobile devices garnering greater and greater storage capacity, processing power and super fast access to information. Throw in the Internet of Things, AI, VR, autonomous vehicles, 3-D printing to name but a few and you have a never before seen amalgam driving automation ever further.

The extensive digitalisation in some cultures has made “ordering a cab, booking a flight, buying a product, making a payment, listening to music, watching a film, or playing a game” as easy as tapping an icon.

Schwab also remarks: “technological innovation will also lead to a supply-side miracle, with long-term gains in efficiency and productivity. Transportation and communication costs will drop, logistics and global supply chains will become more effective, and the cost of trade will diminish, all of which will open new markets and drive economic growth.”

Increased automation will however give rise to social inequality. “The largest beneficiaries of innovation tend to be the providers of intellectual and physical capital — the innovators, shareholders, and investors — which explains the rising gap in wealth between those dependent on capital versus labor. Technology is therefore one of the main reasons why incomes have stagnated, or even decreased, for a majority of the population in high-income countries: the demand for highly skilled workers has increased while the demand for workers with less education and lower skills has decreased. The result is a job market with a strong demand at the high and low ends, but a hollowing out of the middle.”

The impact on business

“On the supply side, many industries are seeing the introduction of new technologies that create entirely new ways of serving existing needs and significantly disrupt existing industry value chains. Disruption is also flowing from agile, innovative competitors who, thanks to access to global digital platforms for research, development, marketing, sales, and distribution, can oust well-established incumbents faster than ever by improving the quality, speed, or price at which value is delivered.

A key trend is the development of technology-enabled platforms that combine both demand and supply to disrupt existing industry structures, such as those we see within the “sharing” or “on demand” economy. These technology platforms, rendered easy to use by the smartphone, convene people, assets, and data — thus creating entirely new ways of consuming goods and services in the process. In addition, they lower the barriers for businesses and individuals to create wealth, altering the personal and professional environments of workers. These new platform businesses are rapidly multiplying into many new services, ranging from laundry to shopping, from chores to parking, from massages to travel.

“A new world of customer experiences, data-based services, and asset performance through analytics, meanwhile, requires new forms of collaboration, particularly given the speed at which innovation and disruption are taking place. And the emergence of global platforms and other new business models, finally, means that talent, culture, and organizational forms will have to be rethought.”

Business leaders and senior executives need to understand their changing environment and continuously innovate.

We need to become aware of the fact that technology is changing and reshaping our day to day lives, economic, social and cultural structures. Schwab realizes that “today’s decision-makers, are too often trapped in traditional, linear thinking, or too absorbed by the multiple crises demanding their attention, to think strategically about the forces of disruption and innovation shaping our future.”

We see this time and time again in industries like hospitality, the lack of time and vision that keeps so many businesses in the proverbial Dark Ages of tech. Understanding that this Fourth Industrial Revolution is, in the end, all about people is key. It’s easy to recoil at images of a “robotised” world where everyone is glued to a device and relies entirely on digital technology to complete even the smallest task. But it is this automation that can empower individuals. Less time spent on repetitive tasks can stimulate creativity and ingenuity. It can turn an overworked employee into a energetic and focused asset who can drive a business forward.

Automation and technology needn’t be harbingers of Apocalypse. They are advanced tools we have shaped to elevate the quality of our lives. From day to day activities to business processes — it has been our collective drive for betterment that’s brought this new age about. Rather than working against it and hanging on to “rustic” ways, it’s time to embrace it in all aspects of our lives and try to use the time it saves us to improve ourselves personally and professionally.

 

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