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Embracing Fourth Industrial Revolution !!!

Kindly note that essay is a very dynamic paper and nobody in India gives a topic wise strategy for essay. Although the style of representation and content can vary from individual to individual, what we are trying to do here is give you some critical aspect, some examples or quotes and reference material which can act as a guide to create a better framework and shape your essay in order to take it to the next-level. Every individual have their strength and way of expression and by no means we want to suppress your creative writing abilities or hamper your imagination, hence use this strategy as a tool to create a better framework. The idea is to expand your horizon of thinking. If you have something more to add do let us know in the comment section.

Introduction:-

  1. This is a technical topic and thus the strategy to tackle this essay is pretty straight forward.
  2. In the introduction introduce the concept and give a glimpse of what it means.
  3. Then discuss various aspects of it.
  4. A brief discussion of foregone Industrial Revolutions can add value to your essay.
  5. As it is a economic concept, hence it has wide ranging implication :-
    1. Job loss due to automation
    2. Rise in Inequality as it is skill-intensive
    3. It has the ability to change the way we live, think or go about our lives, in short it can change our way of life.
  6. Then compare which countries are better positioned to embrace it.
    1. For example , countries like USA, EU countries etc will reap benefit of it however countries like India and China may loose significant number of jobs.
    2. The World Bank estimates – India will lose 60% and China will lose 85% of its jobs.
  7. You also have to discuss the gamut of technology it entails:-
    1. Artificial Intelligence
    2. Internet of Things
    3. 3D printing and other disruptive technologies of 21st century
  8. Then you can show how these technologies can help in building a better society:-Fight terrorism, Climate change etc
  9. Discuss the short term issue that will arise due to this technologies and the long-term implications of it.
  10. Then the most important question:- Can India embrace it ?
    1. Yes, because :-
      1. 4th IR is built upon 3rd IR (IT and ITES) and we have core competency in this sector.
      2. Skilled human capital
      3. Better social capital
      4. Harnessing energy of diaspora in this regard as many Indians are leaders in this arena.
      5. Other factors that play in our favor are-
        1. Good geopolitical profile of the country thus making movement of capital and resource easier.
        2. Robust education sector (With high emphasis on engineering and related skills)
        3. Abundance of skilled manpower and ability to raise the standard and meet the global demands as we did during 3rd IR.
      6. Also Indian economy and its sweet spot among global slowdown is another factor that make it easier for the investors to move capital to India and invest in both human and infrastructural activities.
    2. No, because:-
      1. Huge unskilled workforce( In agro sector)
      2. The need of the hour is low-skilled manufacturing but 4th IR is skill-intensive
      3. It will raise inequalities – Islands of prosperity in sea of poverty
      4. Deglobalizing trends around the world- Brexit, USA etc
      5. 60% job loss to automation
      6. Inadequate social safety net and yet to be realized universal basic income- absence of these factors may disrupt the social fabric and may end in civil war.
      7. India could not truly realize the dividend of its demography
      8. Bad social indicator – health, malnutrition, literacy etc are hindrance to create a strong base of human capital etc
    3. After discussing the above two dimensions – Discuss whether Should India embrace it ?
      1. Yes, because, irrespective of our wishes , 4IR will happen and it is already happening so it is better to embrace the change and be ready for it than to be cut off-guard.
      2. Although it may create short-term disruptions which can be addressed proactively , it will be beneficial in long-term.
      3. In this context social safety net schemes like – Universal Basic Income etc are becoming important.
  11. In conclusion, show how India can embrace it and how it will benefit India.

 

We stand 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.

The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. 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.

There are three reasons why today’s transformations represent not merely a prolongation of the Third Industrial Revolution but rather the arrival of a Fourth and distinct one: velocity, scope, and systems impact. The speed of current breakthroughs has no historical precedent. When compared with previous industrial revolutions, the Fourth is evolving at an exponential rather than a linear pace. Moreover, it is disrupting almost every industry in every country. And the breadth and depth of these changes herald the transformation of entire systems of production, management, and governance.

The possibilities of billions of people connected by mobile devices, with unprecedented processing power, storage capacity, and access to knowledge, are unlimited. And these possibilities will be multiplied by emerging technology breakthroughs in fields such as artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, biotechnology, materials science, energy storage, and quantum computing.

Already, artificial intelligence is all around us, from self-driving cars and drones to virtual assistants and software that translate or invest. Impressive progress has been made in AI in recent years, driven by exponential increases in computing power and by the availability of vast amounts of data, from software used to discover new drugs to algorithms used to predict our cultural interests. Digital fabrication technologies, meanwhile, are interacting with the biological world on a daily basis. Engineers, designers, and architects are combining computational design, additive manufacturing, materials engineering, and synthetic biology to pioneer a symbiosis between microorganisms, our bodies, the products we consume, and even the buildings we inhabit.

Challenges and opportunities

Like the revolutions that preceded it, the Fourth Industrial Revolution has the potential to raise global income levels and improve the quality of life for populations around the world. To date, those who have gained the most from it have been consumers able to afford and access the digital world; technology has made possible new products and services that increase the efficiency and pleasure of our personal lives. Ordering a cab, booking a flight, buying a product, making a payment, listening to music, watching a film, or playing a game—any of these can now be done remotely.

In the future, 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.

At the same time, as the economists Erik Brynjolfsson and Andrew McAfee have pointed out, the revolution could yield greater inequality, particularly in its potential to disrupt labor markets. As automation substitutes for labor across the entire economy, the net displacement of workers by machines might exacerbate the gap between returns to capital and returns to labor. On the other hand, it is also possible that the displacement of workers by technology will, in aggregate, result in a net increase in safe and rewarding jobs.

We cannot foresee at this point which scenario is likely to emerge, and history suggests that the outcome is likely to be some combination of the two. However, I am convinced of one thing—that in the future, talent, more than capital, will represent the critical factor of production. This will give rise to a job market increasingly segregated into “low-skill/low-pay” and “high-skill/high-pay” segments, which in turn will lead to an increase in social tensions.

In addition to being a key economic concern, inequality represents the greatest societal concern associated with the Fourth Industrial Revolution. 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.

This helps explain why so many workers are disillusioned and fearful that their own real incomes and those of their children will continue to stagnate. It also helps explain why middle classes around the world are increasingly experiencing a pervasive sense of dissatisfaction and unfairness. A winner-takes-all economy that offers only limited access to the middle class is a recipe for democratic malaise and dereliction.

Discontent can also be fueled by the pervasiveness of digital technologies and the dynamics of information sharing typified by social media. More than 30 percent of the global population now uses social media platforms to connect, learn, and share information. In an ideal world, these interactions would provide an opportunity for cross-cultural understanding and cohesion. However, they can also create and propagate unrealistic expectations as to what constitutes success for an individual or a group, as well as offer opportunities for extreme ideas and ideologies to spread.

The impact on business

An underlying theme in my conversations with global CEOs and senior business executives is that the acceleration of innovation and the velocity of disruption are hard to comprehend or anticipate and that these drivers constitute a source of constant surprise, even for the best connected and most well informed. Indeed, across all industries, there is clear evidence that the technologies that underpin the Fourth Industrial Revolution are having a major impact on businesses.

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.

Major shifts on the demand side are also occurring, as growing transparency, consumer engagement, and new patterns of consumer behavior (increasingly built upon access to mobile networks and data) force companies to adapt the way they design, market, and deliver products and services.

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.

On the whole, there are four main effects that the Fourth Industrial Revolution has on business—on customer expectations, on product enhancement, on collaborative innovation, and on organizational forms. Whether consumers or businesses, customers are increasingly at the epicenter of the economy, which is all about improving how customers are served. Physical products and services, moreover, can now be enhanced with digital capabilities that increase their value. New technologies make assets more durable and resilient, while data and analytics are transforming how they are maintained. A 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.

Overall, the inexorable shift from simple digitization (the Third Industrial Revolution) to innovation based on combinations of technologies (the Fourth Industrial Revolution) is forcing companies to reexamine the way they do business. The bottom line, however, is the same: business leaders and senior executives need to understand their changing environment, challenge the assumptions of their operating teams, and relentlessly and continuously innovate.

The impact on government

As the physical, digital, and biological worlds continue to converge, new technologies and platforms will increasingly enable citizens to engage with governments, voice their opinions, coordinate their efforts, and even circumvent the supervision of public authorities. Simultaneously, governments will gain new technological powers to increase their control over populations, based on pervasive surveillance systems and the ability to control digital infrastructure. On the whole, however, governments will increasingly face pressure to change their current approach to public engagement and policymaking, as their central role of conducting policy diminishes owing to new sources of competition and the redistribution and decentralization of power that new technologies make possible.

Ultimately, the ability of government systems and public authorities to adapt will determine their survival. If they prove capable of embracing a world of disruptive change, subjecting their structures to the levels of transparency and efficiency that will enable them to maintain their competitive edge, they will endure. If they cannot evolve, they will face increasing trouble.

This will be particularly true in the realm of regulation. Current systems of public policy and decision-making evolved alongside the Second Industrial Revolution, when decision-makers had time to study a specific issue and develop the necessary response or appropriate regulatory framework. The whole process was designed to be linear and mechanistic, following a strict “top down” approach.

But such an approach is no longer feasible. Given the Fourth Industrial Revolution’s rapid pace of change and broad impacts, legislators and regulators are being challenged to an unprecedented degree and for the most part are proving unable to cope.

How, then, can they preserve the interest of the consumers and the public at large while continuing to support innovation and technological development? By embracing “agile” governance, just as the private sector has increasingly adopted agile responses to software development and business operations more generally. This means regulators must continuously adapt to a new, fast-changing environment, reinventing themselves so they can truly understand what it is they are regulating. To do so, governments and regulatory agencies will need to collaborate closely with business and civil society.

The Fourth Industrial Revolution will also profoundly impact the nature of national and international security, affecting both the probability and the nature of conflict. The history of warfare and international security is the history of technological innovation, and today is no exception. Modern conflicts involving states are increasingly “hybrid” in nature, combining traditional battlefield techniques with elements previously associated with nonstate actors. The distinction between war and peace, combatant and noncombatant, and even violence and nonviolence (think cyberwarfare) is becoming uncomfortably blurry.

As this process takes place and new technologies such as autonomous or biological weapons become easier to use, individuals and small groups will increasingly join states in being capable of causing mass harm. This new vulnerability will lead to new fears. But at the same time, advances in technology will create the potential to reduce the scale or impact of violence, through the development of new modes of protection, for example, or greater precision in targeting.

The impact on people

The Fourth Industrial Revolution, finally, will change not only what we do but also who we are. It will affect our identity and all the issues associated with it: our sense of privacy, our notions of ownership, our consumption patterns, the time we devote to work and leisure, and how we develop our careers, cultivate our skills, meet people, and nurture relationships. It is already changing our health and leading to a “quantified” self, and sooner than we think it may lead to human augmentation. The list is endless because it is bound only by our imagination.

I am a great enthusiast and early adopter of technology, but sometimes I wonder whether the inexorable integration of technology in our lives could diminish some of our quintessential human capacities, such as compassion and cooperation. Our relationship with our smartphones is a case in point. Constant connection may deprive us of one of life’s most important assets: the time to pause, reflect, and engage in meaningful conversation.

One of the greatest individual challenges posed by new information technologies is privacy. We instinctively understand why it is so essential, yet the tracking and sharing of information about us is a crucial part of the new connectivity. Debates about fundamental issues such as the impact on our inner lives of the loss of control over our data will only intensify in the years ahead. Similarly, the revolutions occurring in biotechnology and AI, which are redefining what it means to be human by pushing back the current thresholds of life span, health, cognition, and capabilities, will compel us to redefine our moral and ethical boundaries.

Shaping the future

Neither technology nor the disruption that comes with it is an exogenous force over which humans have no control. All of us are responsible for guiding its evolution, in the decisions we make on a daily basis as citizens, consumers, and investors. We should thus grasp the opportunity and power we have to shape the Fourth Industrial Revolution and direct it toward a future that reflects our common objectives and values.

To do this, however, we must develop a comprehensive and globally shared view of how technology is affecting our lives and reshaping our economic, social, cultural, and human environments. There has never been a time of greater promise, or one of greater potential peril. Today’s decision-makers, however, 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.

In the end, it all comes down to people and values. We need to shape a future that works for all of us by putting people first and empowering them. In its most pessimistic, dehumanized form, the Fourth Industrial Revolution may indeed have the potential to “robotize” humanity and thus to deprive us of our heart and soul. But as a complement to the best parts of human nature—creativity, empathy, stewardship—it can also lift humanity into a new collective and moral consciousness based on a shared sense of destiny. It is incumbent on us all to make sure the latter prevails.

The big buzz at the World Economic Forum (WEF) in Davos this year is about the ‘Fourth Industrial Revolution’, described by the founder and executive chairman of WEF, Klaus Schwab, as a “technological revolution that will fundamentally alter the way we live, work and relate to one another”.

The fourth industrial revolution is conceptualised as an upgrade on the third revolution — and is marked by a fusion of technologies straddling the physical, digital and biological worlds. In a paper on The Fourth Industrial Revolution: what it means, how to respond, Schwab says that three things about the ongoing transformation mark it out as a new phase rather than a prolongation of the current revolution — velocity, scope, and systems impact. The speed of change is utterly unprecedented, it is disrupting almost every industry in every country, and it heralds “the transformation of entire systems of production, management, and governance”.

Case of India:-

In 1750 AD, India’s share of global industrial output was 25%; by 1900, this had declined to 2%. The reasons were the chaos triggered by the decline of the Mughal empire, colonization by Britain and the first industrial revolution.

Like China, India missed out on the industrial revolution which saw the invention of the steam engine and powered looms and unleashed a productivity revolution. As a result, our handloom industry was decimated; India became deindustrialized and fell into abject poverty. China has re-industrialized with a vengeance, while India is still struggling to catch up.

This bit of history is more relevant than ever. The industrial revolution was a massive disruption. Countries that drove it or embraced it went from rags to riches, while those that missed out went from riches to rags.

Today, we are in the midst of the fourth industrial revolution that promises to be profoundly more disruptive. The question is whether India is positioning itself to ride this tidal wave or whether once again we will be swept away by it.

The world is at the beginning of a revolution where there are huge advances in genomics, artificial intelligence, materials and manufacturing technologies. Machines are closing in on human ability with astonishing speed. Robots are replacing humans not just on factory floors but in homes too. Reusable rockets promise to make space travel and colonies on Mars and the moon a reality.

Possibly in our own lifetime, we will reach a point called “singularity” where machines become as smart as humans and then keep getting smarter. We will soon be able to edit genes to create favourable traits and new life forms. Science fiction is becoming reality.

As with previous industrial revolutions, new technologies will create new jobs and simultaneously destroy many old ones. The rise of machines, from robots to smart software, threatens to impact not just low-skilled factory workers, but everyone including software engineers, stock traders and taxi drivers.

Even chief executive officers are not exempt; a recent McKinsey study estimates that half the tasks done by CXOs can be automated. While in the long run, it is possible that more jobs will be created than are destroyed; in the medium term, the opposite will be true.

An Oxford study estimates that 47% of the jobs in the US, 69% of the jobs in India and 77% of the jobs in China will not exist in 25 years. This is not conjecture. China’s factories are adding robots faster than they are hiring people. India’s information technology sector is already witnessing jobless growth and total employment may have peaked.

The really vital question is this. While lots of people will lose their jobs all over the world, where will the new jobs be?

Today, much of the world’s fundamental research and innovation is happening in the US. Disruption is being driven very disproportionately by American companies such as Google, Amazon, Tesla, Illumina or First Solar.

The chances are quite high therefore that the bulk of the new jobs will be created in the US. This is important. In the first industrial revolution, Britain and Europe were able to export the job losses created by machinery to colonies such as India. Productivity growth and trade eventually resulted in enormous job and wealth creation in Europe even as it resulted in famine and devastation in India, China and Africa.

Let us assume that all the new developments will create five new high-end jobs and destroy 10. Current trends would suggest two of these will be in the US, two in China and perhaps one in Europe. If this is true, do countries like India once again become colonies? Not of countries perhaps but of companies such as Google, Pfizer or Monsanto? Do we simply become markets for innovations developed elsewhere? Will the vast majority of our people then live on subsistence-wage service jobs? Is India doomed to remain a low-middle-income country?

India is already facing a severe jobs crisis. The consequences of the fourth industrial revolution are truly frightening unless, of course, we learn to ride this wave. But what exactly does that take?

People often wistfully wonder whether India will have its own Microsoft or Google. This is exactly like wondering when we will win an Olympic gold medal. If we win a gold medal, it will be because of a freak event—a person of extraordinary ability and tenacity—not because of the system.

What allowed Apple, Microsoft and Google to emerge is fundamental scientific research at world-class corporate labs such as Xerox PARC or Bell Labs and universities such as Stanford and Massachusetts Institute of Technology. The US government has played a vital role in underwriting high-risk, long-term research projects through institutions such as Defense Advanced Research Projects Agency and National Science Foundation; virtually all the technology in the iPhone was funded this way.

Sensible immigration policies attracted the brightest minds from India, China, Russia and Hungary to these labs. Finally, a vibrant entrepreneurial ecosystem allowed the commercialization of research.

The contrast could not be more stark. There is almost no understanding or discourse on these matters in India; our policymakers, scientists and business leaders are firmly stuck in the old paradigm.

Not one Indian university is ranked in the global top 300. It is hard to think of a single Indian company that is at the leading edge of any of the disciplines that matter to the future. To do cutting-edge work in most scientific and engineering disciplines, our finest minds have either to join the research and development centre of a multinational company or leave the country. Government funding for science-based technology research has been minuscule. It is no wonder that all our entrepreneurial activity is restricted to me-too businesses rather that game-changing ideas.

The fourth industrial revolution simultaneously poses the biggest opportunity and the largest threat to a prosperous future. India cannot afford to squander this moment. What we need urgently is a national mission like the Apollo space programme.

Rapid change and rampant inequality are testing the resilience of economies and societies. It is in our hands to ensure that the potentially disruptive shifts of the Fourth Industrial Revolution not only herald a change of guard in the highest echelons of the global economy, but also rebalance opportunities and outcomes across geographic, generational and gender boundaries.

The growth patterns of the past decades showed both the equalizing and dividing forces of economic and technological change. In 1988, a lower-middle-class US citizen had more than six times the income of a well-off middle-class citizen in China. Today, both earn almost the same amount. Similar leaps happened in other economies, from Turkey to Viet Nam. Yet, in the same period, half of the world’s wealth went to the top 5% of the population, and almost one-fifth went to the highest 1%.

Further tumultuous changes lie ahead as the Fourth Industrial Revolution unfolds, characterised by ubiquitous digitization and technologies that narrow the gap between man and machine.

Yet, whilst it will profoundly shape our future it is far from determining it. Every industrial age found its expression in human values, norms and institutions. In the wake of the First Industrial Revolution, poor working conditions gave birth to socialism and social capitalism; the green movement beginning in the 1970s was a response to the nuclear age and the age of mass production and consumption enabled by the Second Industrial Revolution; in the late 20th century, new global multi-stakeholder governance models gained traction in response to rapid globalization, a result of the Third or “Digital” Revolution which radically lowered communication and transportation costs.

What protocols, partnerships and practices can address the policy dilemmas and unintended consequences of the Fourth Industrial Revolution?

Answering this question will require the courage, thought leadership and entrepreneurial spirit of the leaders gathering at the Annual Meeting of the New Champions. This annual meeting in China brings together scientists, the leaders of up-and-coming companies, social entrepreneurs, political leaders and others to discuss the coming waves of change.

We cannot abandon forces of income, wealth and opportunity concentration, but we can mobilize forces that work against them, from investing into education and entrepreneurship to shaping the governance of emerging technologies. Concretely, an inclusive Fourth Industrial Revolution will require vision and leadership across four domains.

Scaling Up Human-Centred Technology

Technological innovations – from exponential increases in computing power and data to the CRISPR method in gene editing – create not only phenomenal opportunities for human progress, but also serious societal challenges. If we are to seize the opportunities and avoid the pitfalls of the Fourth Industrial Revolution, we must consider the moral and ethical questions it raises with regard to economic and social development, value creation, privacy and ownership, and individual identity. In this context, how do we design human-centred products and services?

Leading Continuous Reinvention

The Fourth Industrial Revolution is shaking up old business models and presenting strategic options that enhance efficiency. On the supply side, developments in energy storage, grid technologies and realtime processing of customer and asset performance are transforming operating models. On the demand side, customers value and expect personalized interaction at all points of their consumer experience. Facing an exponential speed of change in technology, how can leaders recognize adaptive challenges to their organizations and build resilience?

Creating Sustainable Systems

Massively expanding economic activities are placing irresistible pressures on social and planetary systems. At the same time, new technologies are making possible a transformation in almost all spheres of economic and social life. There is a better future to be had in terms of prosperity and quality of life that can also radically reduce pressure on the global commons. How do we seize such opportunities and create more sustainable systems in areas such as energy, mobility, production, health, education, gender and work?

Responding to Geo-Economic Shifts

The erosion of the middle-class is reframing the political economy of slower-growth countries. In faster-growth economies, avoiding the “middle-income trap” is an increasing strategic concern. Common to both is that technological innovation is creating newly advantaged and disadvantaged stakeholders during a period of increasing geopolitical uncertainty. How can communities, companies and countries better prepare for the coming economic changes?

Achieving progress across these four domains is not only a matter of developing new technologies, business and governance models; it also challenges us to reassert fundamental values that serve as a compass and radar at times when old maps no longer serve us well. Achieving Inclusive Growth in the Fourth Industrial Revolution will require the power of imagination to see everything in our present world anew; a deep commitment to diversity as our best – if not only – chance to escape the echo chambers of our biases and beliefs; and a collective capacity for empathy as the glue that holds humanity together.

The world is changing. There’s no way around this fact.

The Fourth Industrial Revolution is now. And, whether you know it or not, it will affect you.

Billions of people and countless machines are connected to each other. Through groundbreaking technology, unprecedented processing power and speed, and massive storage capacity, data is being collected and harnessed like never before.

Automation, machine learning, mobile computing and artificial intelligence — these are no longer futuristic concepts, they are our reality.

To many people, these changes are scary.

Previous industrial revolutions have shown us that if companies and industries don’t adapt with new technology, they struggle. Worse, they fail.

Mindset shift

But I strongly believe that these innovations will make industry – and the world – stronger and better.

The change brought by the Fourth Industrial Revolution is inevitable, not optional.

And the possible rewards are staggering: heightened standards of living; enhanced safety and security; and greatly increased human capacity.

For people, there must be a shift in mindset.

As difficult as it may be, the future of work looks very different from the past. I believe people with grit, creativity and entrepreneurial spirit will embrace this future, rather than cling to the status quo.

People can be better at their jobs with the technology of today—and the technology that is yet to come—rather than fearing that their human skills will be devalued.

Human and machine

I’m reminded of chess.

We have all heard the stories about computers beating even the greatest grandmasters. But the story is more nuanced; humans and computers play differently and each has strengths and weaknesses.

Computers prefer to retreat, but they can store massive amounts of data and are unbiased in their decision-making.

Humans can be more stubborn, but also can read their opponent’s weaknesses, evaluate complex patterns, and make creative and strategic decisions to win.

Even the creators of artificial chess-playing machines acknowledge that the best chess player is actually a team of both human and machine.

The world will always need human brilliance, human ingenuity and human skills.

Software and technology have the potential to empower people to a far greater degree than in the past—unlocking the latent creativity, perception and imagination of human beings at every level of every organization.

Power of data, power of people

This shift will enable workers on the front line, on the road and in the field to make smarter decisions, solve tougher problems and do their jobs better.

This is our mission at Uptake—to combine the power of data and the power of people, across global industries.

Here’s what this looks like:

Railroad locomotives are powered by massive, highly complex electrical engines that cost millions of dollars.

When one breaks down, the railroad loses thousands more for every hour it’s out of service (not to mention, there are a lot of angry travellers or cargo customers to deal with).

After the locomotive is towed in for repairs, technicians normally start by running diagnostic tests. These can take hours, and often require technicians to stand next to roaring engines jotting down numbers based on the diagnostic readings.

That’s the old way – or, at least, it should be.

New solutions

When locomotives operated by our customers roll into the shop for routine services, all diagnostics have already been run.

Our software has forecast when, why and how the machine is likely to break down using predictive analytics — algorithms that analyze massive amounts of data generated by the 250 sensors on each locomotive.

Our systems have examined that data within the context of similar machines, subject- matter experts, industry norms and even weather. If there’s a problem, we detect it, and direct the locomotive to a repair facility.

A mechanic can then simply pick up an iPad, and learn in a few minutes exactly what is about to break down, as well as the machine’s history and the conditions it’s been operating under.

Virtuous loop

That leaves the mechanics to do what they do best: fix it, using their experience, judgement and skill. And the mechanics decisions and actions become data that feeds back into the software, improving the analytics and predictions for the next problem.

So, technology didn’t replace mechanics; it empowered them to do their job.

In the same way that chess masters and computers work best together, the mechanic used human skills that a machine can’t replicate: ingenuity, creativity and experience. And the technology detected a problem that was unknown and unseen to human eyes.

In short, when the mechanic and the technology work together, the work gets done faster, with fewer errors and better results.

Multiply this across all industries: aviation, energy, transportation, smart cities, manufacturing, natural resources, and construction.

The productivity we unleash could be reminiscent of what the world saw at the advent of the first industrial revolution. But the impact of the Fourth Industrial Revolution will run much broader, and deeper, than the first.

We’ll have the knowledge, the talent and the tools to solve some of the world’s biggest problems: hunger, climate change, disease.

Machines will supply us with the insight and the perspective we need to reach those solutions. But they won’t supply the judgement or the ingenuity. People will.

Emerging technologies such as 3D printing and genetic engineering offer a lot of promise, but can also be double-edged swords. They can help make our lives easier, safer and healthier, but there is also potential to build weapons or dangerously modify organisms.

Developments like these raise questions for visionaries such as Nicholas Davis, Head of Society and Innovation, World Economic Forum. Over the course of three previous industrial revolutions, work changed from manual to mechanical to automated mass production. We are now entering the fourth cycle, the world of cyber systems which is disrupting industry faster than ever before.

So it is essential to world peace and prosperity that global leaders address ethical issues surrounding technology, cultivate new norms and values worldwide and provide more opportunities for growth, writes Davis in his thought provoking essay on understanding the fourth industrial revolution.

That’s why the brightest minds from government, business and civil society meet annually to tackle big issues together in the collaborative Spirit of Davos.

The Future of the Internet

The World Economic Forum has been convening annually in the Swiss city for 45 years. Its mission is to improve the state of the world through public and private cooperation.

SAP has been a member of the Forum for years, proactively helping customers, organizations and individuals achieve the United Nations’ 17 Goals for a Sustainable Future with the help of technology. Hyper connectivity and the IoT, for example, are driving a new cycle of global economic activity focused on sustainable solutions that could end our dependence on fossil fuels. Technology can help us reduce waste and redesign production and consumption systems to be more resource efficient. And the Internet enables online learning, instant communication and a world of opportunity for sharing knowledge and best practices.

But there’s still plenty of work left to do in Davos.

The Challenge of Employment

As we change technology, it changes us! Machines and robots are taking over the work of humans so quickly that jobs are becoming obsolete much faster than we can create new ones. Technology is threatening jobs that we previously considered safe, such as taxi drivers and airplane pilots — both in danger from self-driving vehicles. Drones are even delivering pizzas!

New products and processes will certainly lead to new growth, but change does not happen at the same pace everywhere. Technologically advanced societies will profit more while others will lag behind. It’s up to the attendees in Davos to ensure that everyone will have the right education and skills to benefit from these exciting developments.

For decades, we have been witnessed dramatic changes in our world. Through these transformations, civil society has been on the front lines, helping individuals, communities and governments adapt to the new, unfamiliar landscape.

Much has been said about what the next revolution means for businesses, governments and citizens. Despite our lack of immunity to disruption, civil society, specifically nonprofit development organizations, have been absent from these considerations. A likely explanation for this oversight is civil society’s perceived intermediary role – a connector of governments, business and communities. One that helps others adapt, but doesn’t fundamentally change in nature itself.

Yet, today, we see fundamental change happening throughout the non-profit development sector with the emergence of what has been coined as the Fourth Sector. As the leader of an international development organisation, I am energized by the changes and their potential impact on the millions of people who are poor and marginalized around the world.

The Fourth Sector – a convergence of the public, private and nonprofit sectors – is changing the way we operate, approach development and relate to one another, as discussed in Accenture Development Partnerships’ report, “The Convergence Continuum towards a Fourth Sector in Global Development.”

During the course of the last five years, there has been a gradual shift in the business models of both commercial businesses and nonprofits. Traditionally income-driven businesses have progressed from donating money through corporate social responsibility programs to more substantive partnership roles with nonprofits. Today, businesses are taking the shift one step further and integrating social impact into their business models, under the rubric of shared value, encompassing both earned income and some degree of social benefit into their business model.

On the other side of the spectrum, we see an altruistic non-profit sector adopting more traditional business-minded, private-sector characteristics. While contributed income – grant-based work – remains the core of our efforts, non-profits are exploring new market-based social enterprises and impact investment – return-seeking capital – that simultaneously maximize social benefit. Finding, implementing and advocating solutions to global challenges is our mandate, but the way we go about it is fundamentally shifting.

In the middle we have governments, which are accountable to citizens for providing for their basic needs, from health to security. Government models vary widely; however, they traditionally involve earnings from various taxes structures and fees, as well as foreign aid and other types of international financial support. While governments have a long history of working with nonprofits and the private sector, today, they are members of large-scale public-private partnerships and often look to the private sector to help solve problems from infrastructure to healthcare.

While the last decade of global economic turmoil has necessitated tightening of budgets, including those of the largest funders of development programs – overseas development assistance and private foundations – global challenges have continued, growing exponentially in some cases, such as the civil war in Syria and resulting refugee crisis.

Due to growing customer demand for socially responsible products and the direct impact of poverty and instability on global supply chains, multinationals can no longer afford to be uninvolved in the well-being of communities where they operate, as well as all those who are living in poverty and are vulnerable.

Simultaneously, it is unrealistic for non-profits to continue to rely solely on traditional donor assistance if we are to achieve transformational change in people’s lives around the world. Currently, the impact investing market is estimated at $50 billion, and on a path to reach $2 trillion by 2025, which many believe to be a conservative estimate.

With an ambitious global agenda before us, this new market cannot be ignored for its potential significant contribution toward achieving the Sustainable Development Goals, which analysts estimate will cost between $3.3 trillion and $4.5 trillion a year. At Pact, we recently launched a new unit to connect with impact investors and social enterprises, complementing – not replacing – our traditional, grant-based funding. This new market has the potential to exponentially increase our impact around the world, and to introduce new, dynamic partnerships that approach traditional issues in non-traditional ways.

However, it isn’t only consumer demand and funding constraints pushing us to iterate.

The private sector and nonprofits have been working hand-in-hand for more than a decade, increasingly becoming partners in the design, implementation and impact of programs. These true partnerships have led to learnings on both sides. While we recognize that each partner has strengths and expertise that, due to their experiences, only they bring to the table, over time we’ve begun to build off one another and are converging into this new, fourth sector. One that is neither wholly profit-drive nor social impact-driven.

To survive, nonprofits must embrace this disruption and evolve. But more than that, we can actually lead and help envision and establish these new models, with the wellbeing of those we serve as our direction. We aim for transformation in the world, and we need to seize it internally, transforming into a nonprofit of the future.

This is an understandably uncomfortable position for many of us. The private sector has been iterating for decades, adapting to the changing world around it to avoid being left behind. The international development sector is sometimes intransigent. Our modus operandi has not changed much in the last 70 years. But, if we do not embrace the revolution around us, and begin us to also lead where appropriate and be relentlessly creative in how we approach our mission, we will never realize the full potential we have to offer to the world’s global problems.

We must see this revolution as an opportunity – an opportunity for us to increase our impact, helping people escape poverty and own their futures.

Technologies such as big data, advanced analytics, the internet of things, wearables, advanced robotics, learning machines and 3D printing are finding their way into factories.

Despite the sluggishness of change on today’s factory floors, this digital wave is slowly but surely revolutionizing manufacturing, contributing to major productivity enhancements and the emergence of innovative production paradigms that deliver more tailored and efficient solutions.

Needless to say, this transformation has profound implications for manufacturing employment, affecting everything from the size of the workforce, to the skillsets required and the locations of factories. Will this Fourth Industrial Revolution lead to a jobless future for manufacturing or will the “traditional” response of education and training allow workers to remain employable?

A factory with no employees?

According to Autodesk CEO Carl Bass,“The factory of the future will have only two employees: a man and a dog. The man will be there to feed the dog. The dog will be there to keep the man from touching the equipment.”

Indeed, from Jeremy Rifkin in the End of Work to Martin Ford in the Rise of the Robots, economists have been predicting that automation will make human jobs – at least as we know them today – obsolete in the not-too-distant future. In the United States alone, manufacturing jobs have fallen from 25% of the total in 1970 to approximately 10% today, as James H. Lee reminds us in his blog on the World Future Society website. Productivity and employment, which rose and fell in tandem until the early 2000s, now show an increasing gap, reflecting the fact that humans are being displaced by machines for many jobs.

Carl Benedikt Frey and Michael A. Osborne estimate that 47% of US jobs are at risk due to “computerization”. This trend is not just a Western-centric phenomenon;according to David Rotman, “fewer people work in manufacturing today than in 1997, thanks at least in part to automation.” In fact, Foxconn announced in August 2012 that they would introduce one million of robots within three years to replace human labour.

So will this trajectory lead to a jobless future for manufacturing? Not quite – or at least not immediately. But there is no doubt that Industry 4.0 will fundamentally change the nature of manufacturing jobs.

A different type of manufacturing worker

Some human manufacturing tasks, such as heavy lifting, precision positioning and visual quality control, will most certainly be transferred to or supported by robots, which are not only more efficient and effective than humans, but can communicate seamlessly with one another. Human workers will have to learn to work side-by-side and in conjunction with robots. Advanced automation will increase workers’ acceptance of safe and collaborative machines with human-like physiognomies working close to them.

This, along with wearables, augmented reality and other technologies, will change the nature of traditional blue-collar work, which will become both more complex and sophisticated, but also increasingly supported by technology. It is hard to predict whether Industry 4.0 will call for more- or less-skilled workers, but it is clear that the requirements will be very different, with a greater focus on flexibility and adaptability, and potentially less on expertise and craftsmanship.

Nevertheless, robots are still imperfect, and their capabilities are not yet sufficient to fully displace humans. Furthermore, and despite constant progress, the ROI for fully automated manufacturing is still unproven, raising doubts about the speed with which Industry 4.0 is gaining traction. But the revolution is most certainly under way.

A challenging Schumpeterian transition

Throughout previous industrial revolutions, overall job creation has always been positive, but there are serious doubts that this will hold true for this fourth industrial revolution. There does seem to be a consensus that it will change all professions in ways perhaps we are yet to understand.

The other problem with looking at the future of manufacturing employment through the lens of history is that it does not take into account the exponential nature of digital technologies. The ubiquitous connectivity of people and machines, and the real-time data that define the Fourth Industrial Revolution, are governed by Moore’s law (doubling of the performance/cost ratio every 12 to 18 months), while we tend to think and react in a linear mode. In addition, this transformation is not limited to manufacturing. It potentially touches all knowledge and service jobs, thereby raising a much bigger question for society.

The risk we are facing in the near future is mass unemployment for some categories of workers, combined with lack of skills in other categories – and the political and social implications of such imbalances. Will companies, individual governments and society at large (including educational systems and social safety nets) be able to adapt quickly enough to this new paradigm and create an environment in which all can contribute? For this to happen, all parties will need to collaborate in order to invent a systemic, social and sustainable model for a better future of work.

 

 

 

 

August 17, 2017

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