How ready are you for the Fourth Industrial Revolution? That’s the question we asked 1,600 C-level executives in business and government across 19 countries.
The results are informative on how prepared – or not – these leaders are to embrace the challenges and opportunities presented by a new era characterized by the integration of the digital and physical worlds.
Business and government leaders provided insights into how they and their organizations are positioned with respect to the Fourth Industrial Revolution in four key areas: social impact, strategy, talent and technology.
Most noteworthy, the survey results reveal that for all the talk of Industry 4.0, readiness is lacking. Perhaps more concerning, there seems to be a disconnect between a pervasive optimism regarding the expected benefits of Industry 4.0 and what it takes to prepare organizations and workforces to realize the potential of this new reality.
For instance, according the survey, C-level executives overwhelmingly (87%) believe Industry 4.0 will lead to more social and economic equality and stability, and three-quarters say businesses will have much more influence than governments and other entities in shaping this future. Yet less than a quarter believe their own organizations hold significant influence over such crucial factors as education, sustainability and social mobility.
Only one-third of the executives surveyed are highly confident they can act as stewards of their organizations during this time of change. And only 14% are highly confident their organizations are ready to fully harness the changes associated with Industry 4.0.
The majority of C-suite executives surveyed continue to rely on strategies that prioritize “traditional” business operations rather than taking a broader “holistic” view across their organizations of how they can create new value for direct and indirect stakeholders. Only 15% believe they are highly prepared for smart and autonomous technologies and just 17% say they are ready for the blurring of lines demarcating industries – all important hallmarks of Industry 4.0.
In the same vein, executives recognize that one of the biggest threats to their organizations over the next five years is the emergence of new businesses or delivery models. Yet they have a hard time making the investment case to counter the threat because of a lack of internal strategic alignment and short-term focus.
The changes brought about by Industry 4.0 are having a dramatic effect on how and where work is performed and the skills needed. When asked about their own workforces, 86% of executives surveyed said they are doing everything they can to create a better-prepared workforce for this new era. However, less than a quarter are highly confident they have the right workforce composition and the skill sets needed for the future. As a topic of conversation in the C-suite, HR ranks lowest for the majority.
While previous industrial revolutions took generations to unfold, the world-changing convergence of wireless connectivity, artificial intelligence, advanced automation, nanotechnology, 3-D manufacturing, biotechnology and big data is happening at unprecedented speed.
Our research showed that business and government leaders understand that a sea-change is coming; however, it’s unclear if they appreciate how swiftly it will arrive and what must be done to thrive in the new environment. As Nobel laureate Robert Shiller said: “We cannot wait until there are massive dislocations in our society to prepare for the Fourth Industrial Revolution.”
He’s right. To thrive rather than merely survive the intensifying disruptions of the Fourth Industrial Revolution, the imperative is to analyze, assess, organize and act now.