The fourth industrial revolution is now upon us, with significant implications for the way we work, two strategy professors at international business school INSEAD [Institut Européen d'Administration des Affaires] write in Fast Company.
Although the Industrial Revolution is often thought of as a single continuous event, it can be better understood as four sequential revolutions or paradigm shifts,” write Renée Mauborgne and W. Chan Kim, in a excerpt from their new book, Beyond Disruption: Innovate and Achieve Growth without Displacing Industries, Companies, or Jobs. "The first, which began in the late 18th century, was propelled by mechanization and steam power. The second, in the 19th century, was fostered by mass production, electricity, and the assembly line. The third, which took place in the 20th century, introduced computers, automation, and information technologies.”
The fourth, which we are now experiencing, encompasses the advent and convergence of technologies such as artificial intelligence, smart machines, robotics, blockchain, and virtual reality, the authors say. These technologies affect the way we live and will provide greater productivity and lower costs. But, they cautioned, without jobs and sound incomes, people will be unable to enjoy the benefits of efficient, low-cost, and high-quality goods and services.
The “double-edged sword” of this revolution, as they see it, is that the efficiencies engendered by these advances will come at the cost of replacing existing human jobs. “While historically jobs have always been around for human beings through technological revolutions, we have never had a technological revolution that has been capable of displacing so many human beings and so much human brain power as the one we are transitioning through now,” they write.
Twenty million manufacturing jobs will be displaced by smart machines in the next decade, they write, citing a report by Oxford Economics. Other studies predict that smart machines, robotics, artificial intelligence, blockchain technology, 3D printing and automation could endanger as many as 20 to 40 percent of existing jobs during the next few decades. They also cite a Brookings Institution report that found that 36 million U.S. jobs will be at risk of elimination in the next few decades, with another 52 million jobs facing "medium exposure" to displacement.
The "high-end jobs" at risk of elimination include investing, because computerized stock-trading algorithms outperform human employees; journalism, in which robots write stories; and even dentistry. Research papers report that AI can be more accurate in detecting some forms of cancer and eye disease.
“Machine-learning-automated decision-making systems will [also] become responsible for tasks such as writing contracts, approving loans, appraising real estate, deciding whether a customer should be onboarded, and identifying corruption and financial crime,” they write. Technology developments have enabled major companies to remain profitable while shedding employees.
Given these factors, companies face a choice between modernizing and becoming irrelevant, they emphasize. Pushing or shaming companies to protect unneeded workers is inefficient and globally noncompetitive.
“Essentially, we are entering a new era in which the efficacy of technological advances is hitting a tipping point,” their article concludes. “These advances will increasingly replace a wide range of human jobs with a new labor force like Alexa, Siri, and Bixby, which doesn’t need to check social media, receive a paycheck, take vacations, eat, or even rest.”