“The internet is changing the way we live, work, produce and consume. With such extensive reach, digital technologies cannot help but disrupt many of our existing models of business and government.”
This is a quote from our explainer on The Future of the Internet, one of our Global Challenges, which you can read in full here.
It’s also a message that is central to this session on the Digital Transformation of Industries, which asks – what will be the impact of digitalization on business and society? What big bets are companies making in the digital transformation of their business models and organisational structures?
For background info, watch this introductory video featuring the Forum’s Head of Digital Transformation, Bruce Weinelt.
So what are some of the innovations that are shaping this new future for the internet and industry? This piece, by the Forum’s Fulvia Montresor, Head of Technology Pioneers, looks at seven technologies that are changing our world. It reads:
“From intelligent robots and self-driving cars to gene editing and 3D printing, dramatic technological change is happening at lightning speed all around us.
The Fourth Industrial Revolution is being driven by a staggering range of new technologies that are blurring the boundaries between people, the internet and the physical world. It's a convergence of the digital, physical and biological spheres.
It's a transformation in the way we live, work and relate to one another in the coming years, affecting entire industries and economies, and even challenging our notion of what it means to be human.”
Meanwhile, panel member Marc Benioff has written a piece for our blog platform, Agenda, on the role of business in this era of transformation. “In my 35-plus years in the technology industry, I’ve never experienced so much innovation, and at such an incredibly rapid pace,” he says.
Here’s more from the Salesforce Chairman and CEO:
“Breakthroughs in artificial intelligence, quantum computing, robotics, clean energy, genetic engineering and other fields have the potential to profoundly reshape manufacturing, agriculture, medicine and more. Business leaders everywhere are trying to keep up with this immense wave of digital transformation.
It’s also a time when every business leader needs to consider how these digital technology breakthroughs are going to impact not just their companies, but their communities, the planet and society as a whole. These amazing innovations not only create phenomenal opportunities for economic growth, but also serious societal challenges as well. Vast numbers of jobs will be replaced by machine intelligence and robots. The increasing capabilities of artificial intelligence and genetic engineering have the potential to get beyond the control of their creators.
As a society, we are entering uncharted territory - a new world in which governments, business leaders, the scientific community and citizens need to work together to define the paths that direct these technologies at improving the human condition and minimizing the risks.
Rich Lesser, moderating the session, says the digital transformation of industries is the one thing that comes up most in his discussions with business leaders across the world.
What does digital transformation mean?
For Klaus Kleinfeld, it’s something that is relevant to all of us. The Fourth Industrial Revolution is allowing us to do things we have never been able to do before. Suddenly we are able to do things in 20 minutes that used to take 20 days. The challenge for companies that are big is – how do you make sure that everyone involved in an organisation feels that there is a revolution going on?
Connectivity is not news, says Jean-Pascal Tricoire. The difference now is that all these devices are connected to each other, and this is opening up new ways of working with partners. With digitisation, everything can be shared. “It’s not just changing what we do, it’s changing the way we do it,” he says.
Bernard Tyson says that for his industry – healthcare – the digital transformation has been dramatic. “Previously, everyone came to us,” he says. Now it’s about accessing care everywhere. Patients never have to leave their home, office, or wherever they are to have a virtual visit with their health advisor.
This has created incredible possibilities, but also incredible fears.
Meg Whitman argues that the defining factor of this transformation, and the key to being successful in it, is speed. If companies can’t develop at a pace that allows them to win, they will find themselves behind very quickly.
Virtually every existing company has a problem, Whitman continues – a slow IT infrastructure that needs to adapt to this new environment. This is driving organisational change, and every CEO needs a plan. Ask yourself, what are the milestones, and how can they be achieved.
Marc Benioff references Professor Klaus Schwab’s book on the Fourth Industrial Revolution, which he says is a “great place to start and map your company against.”
Benioff highlights something all the panellists think is essential to surviving and thriving the digital transformation of industries – trust. He says:
“The Fourth Industrial Revolution starts with one very important point: trust. You are about to define a new level of trust between yourself and your employees, yourself and your customers, yourselfyou’re your shareholders, and yourself and your partners. This is a cultural revolution for organisations that are not built on trust.
“This is an opportunity for all of us – to get to the future first, but when you get there, make sure that you show up with the right values. Because the value of the Fourth Industrial Revolution are diffrerent to the values of the Third.”
How do organisations know if they’re moving fast enough?
You need to get there incrementally, and you need to have a plan, says Whitman. If you don’t have a plan, you won’t get there, and never underestimate your organisation’s ability to move fast.
Tyson adds that it’s also important to consider what you should not be doing, while Kleinfeld believes a “long-term vision always wins.”
Another theme that runs throughout this session is speed. As Benioff puts it, “if you’re not going fast enough, somebody else will get there before you.”
But if a company and its CEO races ahead to keep pace with technological advancement, how can they be sure to bring the rest of the organisation – particularly employees and customers - along with them?
For Whitman, it’s about having the right people. Transformation is not for everyone, and you need to find the people with the right constitution to handle it. Communication is also key – not the facts and figures, but the stories that you tell. Finally, you need a set of shared values and beliefs.
The CEO needs to set a clear message, however, says Kleinfeld.
At the end of the day, says Whitman, “It’s Darwinism”. If you don’t reinvent, someone else will.