6 November 2019

Challenging the Norm

No matter how you look at it, we live in interesting times. The digital era that we saw develop in small steps during the fifties, evolved into huge leaps as it took the last bend into the 21st century. Now, we find ourselves in the midst of the Industrial Revolution (IR) 4.0. It’s rare these days not to hear IR4.0 being brought up in almost any context. And along with that are other buzz terms like Internet of Things (IOT) and blockchain.

Let’s break it down so we can make some sense of these jargons and the impact that they may have in the way we may do things in the near future.

Industrial Revolution 4.0 refers to the fourth phase of the industrial evolution. First being the migration from farming to factory production, second, the introduction of mass production and assembly lines with the use of electricity, giving way for the first mass produced cars. And then the 3rd industrial revolution, which gave birth to the digital age, shifting analogue and mechanical tasks to a more sophisticated and less demanding environment.

Although only now surfacing with vigor, the world began experiencing traces of IR 4.0 way back in the 1970s. Broadly encapsulated, IR 4.0 is not the birth of anything but more so an acknowledgement of digitization, technology, automation and data transfer in the way we live, work and play.

Internet of Things (IoT) on the other hand, falls under the IR 4.0 umbrella and refers to the technology involved in integrating devices, machinery, industries and human beings. It’s how factories and industries are becoming “smarter,” through software and mechanisms. A good example is how IoT allows a modern construction site supervisor track materials moving in and out of his construction site just by referring to his mobile device.

Then comes blockchain or commonly described as a digitized open ledger. Blockchain allows records and information to be synchronized between peer to peer networks securely. Just like transferring funds online, funds are deducted, added and recorded on various platforms simultaneously. Of course, it’s a little more complex than that, but it will do at this juncture.

So, the big question is, where do we stand in the grand scheme of things?

Prime Minister Tun Dr Mahathir Bin Mohamad during his speech at the Beyond Paradigm Summit 2019 said, “To establish an ecosystem of Industry 4.0, both industry leaders and the talent supply have to fully understand and embrace the disruptive technologies. For now, adapting is a must, but soon, mastering the technology is fundamental.”

Looks like Malaysians will have to pull their socks up fast because change is imminent. But that’s not all, he further stressed, “…it has been projected that 65 per cent of today’s children, currently in primary education, will be working in jobs that do not exist today.” If nothing else shocks you, the thought that our children’s careers will be based on technological eventualities can be rather daunting.

Bottom line is we as Malaysians need to be vigilant to the changes happening all around us. Just look around, the physical newspaper is slowly being replaced by online news portals, residential telephones are redundant due to mobile phones, broadcast services are being sidelined by streaming applications…and the list goes on. What’s more, business models have also morphed in unbelievable proportions, Airbnb is a company that’s devoid of hotel ownership, while Grab transports thousands of people without a single taxi under its name.

Online banking has allowed us to pay and conduct cashless transactions while SMEs -through crowdfunding – are getting their peers to finance business operations and expansion plans.

And speaking of crowdfunding, SMEs in Malaysia are slowly opening up to the immense possibilities of crowdfunding. Initially employed to assist startups in business activities in return for an equity share in a given business, Peer to Peer (P2P) funding is certainly making waves around the world. Thanks to blockchain and fintech advancements, people are beginning to open their minds to new ways in investing, as well as seeking funds in running businesses. One of such examples is the development of P2P insurance premium funding which has gathered immense traction in the US, UK and Australia.

They say change is inevitable, and in the case of IR 4.0, it’s definitely true. If we intend to be on par with the rest of the world, we’ll need to revamp mindsets, equip ourselves with the right knowledge and give IR 4.0 a chance.