We live in interesting times. The pace of change continues to accelerate, politically, economically and socially. Technology plays an increasingly pivotal role in all these areas. Causing disruption and reaction. Recent elections are the most topical example of the influential role technology, specifically social media and artificial intelligence, has on our political and social landscape, but there are many more.
Mobile technology has been the single greatest enabler of this phenomenon, providing unprecedented global access to over five billion people and their data. This distribution network, enables incredible growth opportunities, but it also lowers the barrier to entry and therefore creates a highly volatile market, where companies rise and fall at ever increasing speed.
The pace of change is highlighted by any number of examples. Two that I often quote are the changing work environment, where a job for life is a distant memory for all but our parents and grandparents, and then, at a more macro level, the shortening lifespan of companies today. Figure 1 below illustrates this very clearly. The average lifespan of a company in Standard & Poor’s Index has shortened in the past 50 years, from 62 years in the 1950/60s to between 15 and 20 years today;
The point here is that companies and professionals need to be extremely agile to remain relevant and competitive. This does not just mean keeping your finger on the pulse (by, for example, attending a highly informative conference), but ensuring that you have the systems and corporate culture in place to then implement the changes required, to not only survive, but flourish.
Much like climate change, we have seen huge changes before in the previous three industrial revolutions (see figure 2 below), but it is the accelerating pace of change that is significantly different and creates massive challenges. Yes, the previous industrial revolutions caused huge disruption and change, the move from field to factory and urbanisation, being an obvious example. While profound socially, economically and politically, this was a more gradual process.
Individuals, companies and governments need to understand and manage this change, to prevent further economic, social and political unrest. If you think this is a grandiose statement, let me point out another example. The most common job in 35 of 50 states in the United States of America is truck driving, employing over three million people, but with the advent of autonomous vehicles, this future of this job is under threat. Otto (an Uber company) and Volvo have already started using autonomous trucks, and while they say that drivers are still involved, the end result is obvious. Clearly, this will cause social and political disruption. Managing the transition is an economic and political issue.
We should not just focus on the economic and social disruption the Fourth Industrial Revolution will cause. As with every other industrial revolution, the change is ultimately overwhelmingly positive, more jobs, better lifestyle, greater efficiency, higher GDP, etc. The short term disruption does, however, need significant oversight, to ensure some groups are not left behind.