4th Industrial Revolution: What it means for us

4th-industrial-revolution

Last week Pick ‘n Pay  announced the self service pay point.

In 2007, Airports Company of South Africa (ACSA) unveiled self-service check-in kiosks at major airports.

Customers benefit from this advances because it means they don’t have to wait in long queues.

We read books electronically, download music, and we use our phones and tablets to take and share pictures, we can study online, we have FaceTime, holograms, drones etc.

Today we don’t know if FNB is a bank or an innovation company or even mobile service provider. Discovery Health is now flirting with the idea of being a bank.

Apple Inc is not only a technology company but is now making watches and TVs.

The world’s largest taxi firm, Uber, owns no cars. The world’s most popular media company, Facebook, creates no content. The world’s most valuable retailer, Alibaba, carries no stock. And the world’s largest accommodation provider, Airbnb, owns no property. Something big is going on.

In the book The StartUp Revolution: Fit In or Stand Out, I talk about the end of industrial revolution and the beginning of the connection economy. I called it the Connection Economy, the World Economic Forum in Africa calls it the 4th Industrial Revolution.

Whatever definition we choose, what is clear is that we stand on the brink of a 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.

Unlike the French revolution, the Arab spring, or other dramatic revolutions, the 4th Industrial Revolution is a silent revolution. This revolution will certainly not be televised. It will not make newspaper headlines, but it is happening, silently.

This revolutions results in today’s big companies not employing people en masse.

WhatsApp was bought by Facebook for about $16 billion, at that time WhatsApp employed about 50 employees. If you rewind to 1980, a company valued at $16 billion would be employing thousands of people.

In 2012, Google, for example, generated profit of nearly $14 billion while employing fewer than 38,000 people. Contrast that with the motor industry. At peak employment level in 1979, General Motors alone had nearly 840,000 workforce but earned only about $11 billion, 20% less than what Google raked in. And, yes, that is after adjusting for inflation.

Companies like Google and Facebook, for example, have succeeded in becoming household names and achieving massive market valuations while hiring only a tiny number of people relative to their size and influence.

There is every reason to expect that a similar scenario will play out with respect to nearly all the new industries created in the future.

Where are jobs going to come from?

Last week, one of the big mines in Botswana announced the retrenchment of staff, in South Africa, mining companies have been laying off staff for some time now. There are fears that the mechanization of industries will result in job losses.

Can you imagine the period where Uber cars are self-driving cars?

The question is not if the 4th Industrial Revolution will result in mass job losses, the question is how do we re-training and re-skill workers for the unfolding revolution. The question is how do we restructure our businesses to be relevant.

This revolution will ultimately challenge one of our most basic assumptions about technology: that machines are tools that increase the productivity of workers. Instead, machines themselves are turning into workers, and the line between the capability of labour and capital is blurring as never before.

At some point down the line, we could end up with plenty of job-seeking robots.

All this progress is, of course, being driven by the relentless accelaration in technology. According to Moore’s Law, computing power roughly doubles every 18 to 24 months, not everyone has assimilated the implications of this extraordinary exponential progress.

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.

Across all industries, there is clear evidence that the technologies that underpin the Fourth Industrial Revolution are having a major impact on businesses.

As an entrepreneur, your business will be affected, how you respond to all this:

  • Do you push back the 4th industrial revolution and its changes or even try to slow it down whiles you are figuring out what to do next, or
  • Do you fully embrace the effects of the 4th industrial revolution in your business and adjust accordingly, or
  • Do you pro-actively take steps to stay ahead of the curve and use this revolution as a competitive advantage.

Whatever you choose, the 4th Industrial Revolution is happening, even if you choose ignore it.

This is not a novelty that will wear off, it is something that will alter how we do business, even more it will alter IF we stay in business.

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