Last year the World Economic Forum labeled 2017 as the beginning of the Fourth Industrial Revolution. What value do we gain from defining industrial revolutions? I believe it is to define new sets of rules for winning in business. Let’s review the three previous industrial revolutions.
- Industrial Revolution #1. We move from reliance on animals, human muscles and biomass to the use of fossil fuels and mechanical power. A caveman/businessman wishing for a competitive advantage might be the first to use mechanical power fueled by fossil fuels to build cave-condos faster and cheaper than other Neanderthals.
- Industrial Revolution #2. Electricity is harnessed and distributed, both wireless and wired communication is developed, the synthesis of ammonia provides new fertilizers and harvests increase, and new forms of power generation are developed. A farmer wishing for competitive advantages could adopt mobile phones to communicate wirelessly with their workers, use lights around the farm to extend hours of operation, fertilizers could increase their production.
- Industrial Revolution #3. Digital systems are developed, communication and rapid advances in computing power achieved, which enable new ways of generating, processing and sharing information. A businessman operating a disco and seeking competitive advantages installs a digital cash register for more accurate cash management, buys an Apple Computer with the VisiCalc spreadsheet to better manage the business, and installs a heavy printer to print disco-oriented newsletters and other business documents from the office.
- Industrial Revolution #4. Billions of humans are connected by mobile devices and networks, surrounded by sensors, wearing wearables, supported by unprecedented processing power, storage capacity, and access to knowledge, which serves as the springboard for developments in artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, biotechnology, materials science, energy storage, and quantum computing. A business woman seeking a competitive advantage decides to develop and rent out genetically-altered and custom-designed farm animals with embedded GPS sensors to urban dwellers by developing a mobile app connected to the internet where chatbots take your reservation and deliver the beasts in autonomous self-driving trucks pulling cattle trailers.
