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The Fourth Industrial Revolution

Augmented reality, machine automation, and more: the 21st-century industrial revolution is digital. Industry 4.0, the Fourth Industrial Revolution, and 4IR all refer to the current era of connectivity, advanced analytics, automation, and advanced-manufacturing technology that has been transforming global business for years. This wave of change in the manufacturing sector began in the mid-2010s and holds significant potential for operations and the future of production.

Schwab argued these technological changes are drastically altering how individuals, companies and governments operate, ultimately leading to a societal transformation similar to previous industrial revolutions.

Zvika Krieger, the head of technology policy and partnerships at WEF, told CNBC on Tuesday there is a common theme among each of the industrial revolutions: the invention of a specific technology that changed society fundamentally.

Professor Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, has published a book entitled The Fourth Industrial Revolution in which he describes how this fourth revolution is fundamentally different from the previous three, which were characterized mainly by advances in technology.

In this fourth revolution, we are facing a range of new technologies that combine the physical, digital and biological worlds. These new technologies will impact all disciplines, economies and industries, and even challenge our ideas about what it means to be human.

These technologies have great potential to continue to connect billions more people to the web, drastically improve the efficiency of business and organizations and help regenerate the natural environment through better asset management, potentially even undoing all the damage previous industrial revolutions have caused.

It seems a safe bet to say, then, that our current political, business and social structures may not be ready or capable of absorbing all the changes a fourth industrial revolution would bring, and that major changes to the very structure of our society may be inevitable.

Industry 4.0 is revolutionizing the way companies manufacture, improve and distribute their products. Manufacturers are integrating new technologies, including Internet of Things (IoT), cloud computing and analytics, and AI and machine learning into their production facilities and throughout their operations.

Developing smart factories provides an incredible opportunity for the manufacturing industry to enter the fourth industrial revolution. Analyzing the large amounts of big data collected from sensors on the factory floor ensures real-time visibility of manufacturing assets and can provide tools for performing predictive maintenance in order to minimize equipment downtime.

Industry 4.0 concepts and technologies can be applied across all types of industrial companies, including discrete and process manufacturing, as well as oil and gas, mining and other industrial segments.

Starting in the late 18th century in Britain, the first industrial revolution helped enable mass production by using water and steam power instead of purely human and animal power. Finished goods were built with machines rather than painstakingly produced by hand.

A century later, the second industrial revolution introduced assembly lines and the use of oil, gas and electric power. These new power sources, along with more advanced communications via telephone and telegraph, brought mass production and some degree of automation to manufacturing processes.

The third industrial revolution, which began in the middle of the 20th century, added computers, advanced telecommunications and data analysis to manufacturing processes. The digitization of factories began by embedding programmable logic controllers (PLCs) into machinery to help automate some processes and collect and share data.

A new framework for advanced manufacturing is being promoted in Germany, and is increasingly being adopted by other countries. The framework represents a coalescing of digital and physical technologies along the product value chain in an attempt to transform the production of goods and services1. It is an approach that focuses on combining technologies such as additive manufacturing, automation, digital services and the Internet of Things, and it is part of a growing movement towards exploiting the convergence between emerging technologies. This technological convergence is increasingly being referred to as the 'fourth industrial revolution', and like its predecessors, it promises to transform the ways we live and the environments we live in. (While there is no universal agreement on what constitutes an 'industrial revolution', proponents of the fourth industrial revolution suggest that the first involved harnessing steam power to mechanize production; the second, the use of electricity in mass production; and the third, the use of electronics and information technology to automate production.) Yet, without up-front efforts to ensure its beneficial, responsible and responsive development, there is a very real danger that this fourth industrial revolution will not only fail to deliver on its promise, but also ultimately increase the very challenges its advocates set out to solve.

Blockchain has been called a pillar of the Fourth Industrial Revolution, comparing it to technologies such as the steam engine and the internet that triggered previous industrial revolutions. It has the power to disrupt existing economic and business models and may prove particularly valuable in emerging market economies. According to experts, blockchain also holds great promise as a method of fighting corruption, especially in Latin America and the Caribbean, where more smartphone penetration can facilitate the adoption of new technology.

Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, famously described the Fourth Industrial Revolution a couple of years ago. The first three industrial revolutions are well known. The first, from 1760 to 1840, brought the steam engine, railroads, and machine manufacturing. The second, from about 1870 to 1914, gave us electricity and mass production. The third, often called the digital revolution, encompassed the last decades of the 20th century and produced semiconductors, computers, and the Internet. The Fourth Industrial Revolution began in about 2000 and builds on the third to leverage the increasingly pervasive influence of the digital world in every aspect of modern life.

A new generation of high tech weapons. The United States and some of its potential adversaries are incorporating the technologies of the Fourth Industrial Revolution into a range of innovative new weapons systems, including railguns, directed energy weapons, hyper-velocity projectiles, and hypersonic missiles. These new weapons will dramatically increase the speed, range, and destructive power of conventional weapons beyond anything previously imaginable. However, the U.S. military remains heavily over-invested in legacy systems built upon late 20th century technologies which compete against these newest technologies for scarce defense dollars. Here, rising powers such as China have a distinct new mover advantage. They can incorporate the very newest technologies without the huge financial burdens of supporting of older systems and the military-industrial constituencies that promote them (and, for authoritarian states, without adhering to democratic norms of transparency and civilian oversight). This challenge is severely exacerbated by the broken U.S. acquisition system, in which the development timelines for new weapons systems extends across decades.

Professor Klaus Schwab has published a book entitled The Fourth Industrial Revolution in which he describes how this fourth revolution is fundamentally different from the previous three, which were characterised mainly by advances in technology.

The original industrial revolution beginning in the late 18th century largely replaced hand labor with mechanized production using water and steam power that created factories and the textile industry. A century later, the second, known as the Technological Revolution, used steel, oil and electric power together with railroad and telegraph networks to create mass production, including the modern production line.

The third, known as the Digital Revolution, saw the emergence of computers, the internet and the use of electronics to automate production in the late 20th century. Now the fourth builds upon it, with a fusion of technologies that until recently seemed imaginary, and looks to transform entire systems of production, management and governance.

Nevertheless, the globalized nature of value chains means that most parts of the world will be impacted by 4IR sooner or later, directly or indirectly, positively or negatively. Some observers fear that it presages widespread unemployment as humans are replaced by technology. The more optimistic forecaster sees an opportunity for developing countries to leapfrog some intermediate stages of industrialization. Either way, much (virtual) ink has been spilled advising industries and economies on how best to prepare themselves. But the ability to benefit from 4IR will be contingent on the availability (and affordability) of ADP technologies, together with the right level and combination of skills and industrial capabilities. Unless developing economies are able to fulfil these two requisite conditions simultaneously, the accelerating frontrunner economies are likely to leave them behind.

4IR represents a technological paradigm shift with uncertain consequences in many spheres of life. The opportunities for greater productivity, sustainability, social inclusion and prosperity are compelling, but are contingent on an enabling industrial ecosystem and a supportive policy regime.

This next phase will be the fourth industrial revolution and will witness the rise of the mobile internet, automation, 5G broadband technology and artificial intelligence. This revolution will affect every industry as well as both white collar and blue collar jobs, possibly transforming all work that humans will actually perform in the future. According to a World Economic Forum report, some 75 million current jobs may disappear by 2022 while 133 million new and different jobs will be created during this same period. No doubt, the future of work is rapidly changing as technology accelerates and integrates machine learning. 781b155fdc