Your Primer for Understanding the Fourth Industrial Revolution
Just as the invention of the steam engine in the 18th century allowed for production to be mechanized and mass urbanization to be a reality, the Fourth Industrial Revolution, also known as 4IR or Industry 4.0, is poised to transform the way we do business and live our lives but at an even more whirlwind pace than we could ever imagine. What do we need to know to adapt appropriately? Here’s everything you need to know in our primer.
While we have yet to understand the implications of what’s to come from it, we’re already living with the consequences of this new era. Think of virtual assistants like Alexa from Amazon or Siri from Apple, the personalized recommendations you get on Netflix, or the GPS systems that suggest the fastest routes to a destination. As Salesforce states, “[a]s a result of this perfect storm of technologies, the Fourth Industrial Revolution is paving the way for transformative changes in the way we live and radically disrupting almost every business sector.”
Now that I’ve given you a preview into how transformative (and how it’s already transformed our lives and behavior), there’s a critical question we need to answer.
What is the Fourth Industrial Revolution?
Klaus Schwab, the Founder and Executive of the World Economic Forum, as well as the author of The Fourth Industrial Revolution, coined this term to describe the industrial revolution “…characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.” How did we get to the fourth? Let’s go through history and walk through the significant industrial revolutions to understand the progress we’ve made in business and industry.
As we previously mentioned, the First Industrial Revolution used steam power to mechanize production through the invention of the steam engine. The Second created mass production using electric power, and in the Third, we automated production through electronics and information technology. As Schwab describes, the Fourth Industrial Revolution builds off the Third. This diagram from Salesforce demonstrates some of the inventions that came out of each of these revolutions, as well as the periods:
Source: Salesforce
What are the defining characteristics of this new era? Schwab notes they are: “velocity, scope, and systems impact.” There’s been no precedent for the breakthroughs we’re experiencing, and it’s evolving at an exponential pace rather than the linear pace seen in prior industrial revolutions and disrupting nearly every industry in every country worldwide. Not only that; “…the breadth and depth of these changes herald the transformation of entire systems of production, management, and governance.”
What technologies are characteristic of the Fourth Industrial Revolution?
According to Salesforce, the most reliable summary of the Fourth Industrial Revolution is examining the technology working to propel it forward. These include Artificial Intelligence (AI), Blockchain, quantum computing, nanotechnology, robotics, the Internet of Things (IoT), 3-D printing, self-driving cars, and materials storage. The technological breakthroughs stemming from these disciplines as a consequence of the Fourth Industrial Revolution are accentuating the unlimited possibilities, as Schwab puts it, of “…billions of people connected by mobile devices, with unprecedented processing power, storage capacity, and access to knowledge.”
Salesforce research also highlights the potential these technologies have to change the expectations consumers have of these corporations. The 2nd Edition of the Salesforce State of the Connected Consumer Report found that consumers worldwide believe the following technologies will transform their expectations of companies in the next five years:
Source: Salesforce
How should we be preparing for the Fourth Industrial Revolution?
With the movement in full-swing, the impact the Fourth Industrial Revolution will have on business will center on four areas: “on customer expectations, on product enhancement, on collaborative innovation, and on organizational forms.” How can we work on adapting to these principles in our day-to-day activities, especially when it comes to customer expectations? Here are some pointers.
Focus on the Customer Experience
We’ve consistently been talking about how consumers are becoming increasingly conspicuous, and with that in mind, they’re expecting a customer experience that meets their increasingly-high expectations. The 2nd Edition of the Salesforce State of the Connected Consumer Report results shows that about half of customers claim companies are not providing exceptional experiences, and 76% of them say it’s even easier to take their business to another brand than before. That’s something that should leave you on high alert, especially since 57% of consumers have stopped buying from a brand because of the better experience they received from a competitor. How can we do that?
We need to have digitized information about our current and potential customers at our disposal, with segmentation about their interests (that we can detect through their behavior with IoT devices, their browsing and purchase history, and more). This information should be accessible and actionable. Vast amounts of data are only useful if we can treat them in an automated and segmented way. Therefore, we also need to invest in optimal tools, such as Salesforce’s suite of products, that will give us everything we need to offer a consistent, 360° experience across all touchpoints.
Foster Trust
With an increasing demand for personalization, one of the cardinal demands from consumers is more trust in their data. In fact, “Salesforce Chairman and Co-Chief Executive Officer Marc Benioff believes a “trust revolution” is needed if businesses are to fully embrace the potential of the Fourth Industrial Revolution.” With 57% of consumers not comfortable about how firms are using their information and nearly two-thirds of them worried about data breaches, we have to make concerted efforts to build trust with our consumers, especially when it comes to the ways we use their data.
Give Your Marketing Tools an Upgrade
As we mentioned above when talking about the customer experience, it’s critical you take stock of your current processes, pinpoint the ones that may be holding you back, and update them with the tools that can help you do just that. At WAM, we work with the Agile Methodology, as well as a full suite of tools for Marketing Automation, content creation, web development, and more across all business areas to ensure we’re getting the most out of everything we do.
Keep Your Messaging Consistent
Make sure your communications focus on your customers’ pain points, and you master telling your story because more often than not, the messaging will focus on business strategies, while it should focus on the end consumer. Find out what consumers, and investors, are looking for and adapt your copy to match.
Future-Proof the Workforce
While it’s true the potential for significant advances are there, Schwab notes that there are some consequences we will need to be aware of that could leave people behind. There is potential that it could lead to greater inequality, especially in terms of dividing the labor market between “high-skill/high-pay” and “low-skill/low-pay” roles that could exacerbate social tensions. US presidential candidate Andrew Yang talks about the threat automation poses to American society as a critical pillar of his campaign.
With that in mind, workers will need to update their skills continuously. It’s no wonder Salesforce cited a figure from a study that “…59% of hiring managers believe that AI will impact the types of skills their companies need.” This issue will require, as Salesforce.org Executive Vice President and Chief Philanthropy Office Ebony Frelix noted in a panel at Dreamforce ’18, businesses and governments to share responsibility for giving workers the skills they’ll need to succeed in the future workforce. It will be critical as jobs will disappear and even more will emerge with the rise of new technologies.
Now, my final question to you is, what is your plan for adapting to the Fourth Industrial Revolution?
