Book notes #2 — The Fourth Industrial Revolution

As promised, I’m continuing my book note series where every time I finish a book, I’m sharing my quick thoughts and notes so others can potentially benefit from them. This is one I finished last year but is as timely as ever:

The Fourth Industrial Revolution — by Klaus Schwab

Stream of consciousness review:
Overall quick read; reads almost like an informational pamphlet. Covers a lot of ground but moves slow at times. For those in tech, many of the deeper examples (between the headlines) will be redundant to what we already know and discuss, but to those outside of the tech industry, this is a well-researched and transparent display of the technological changes to come. There are a number of statistics intertwined within the pages that will make you feel how things have changed. Walking away from this read you’ll feel informed, motivated to make a difference, and maybe even a little afraid.

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Raw highlights (directly from the book):
Technology breakthroughs, covering wide-ranging fields such as artificial intelligence (AI), robotics, the internet of things (IoT), autonomous vehicles, 3D printing, nanotechnology, biotechnology, materials science, energy storage and quantum computing, to name a few.

The changes are so profound that, from the perspective of human history, there has never been a time of greater promise or potential peril.

The first industrial revolution spanned from about 1760 to around 1840. Triggered by the construction of railroads and the invention of the steam engine, it ushered in mechanical production. The second industrial revolution, which started in the late 19th century and into the early 20th century, made mass production possible, fostered by the advent of electricity and the assembly line. The third industrial revolution began in the 1960s. It is usually called the computer or digital revolution because it was catalysed by the development of semiconductors, mainframe computing (1960s), personal computing (1970s and 80s) and the internet (1990s).

It is the fusion of these technologies and their interaction across the physical, digital and biological domains that make the fourth industrial revolution fundamentally different from previous revolutions.

…yet to be fully experienced by 17% of the world as nearly 1.3 billion people still lack access to electricity.

The fact that a unit of wealth is created today with much fewer workers compared to 10 or 15 years ago is possible because digital businesses have marginal costs that tend towards zero.

(storing 1GB costs an average of less than $0.03 a year today, compared to more than $10,000 20 years ago)

The consequence of the platform effect is a concentration of few but powerful platforms which dominate their markets.

blockchain, often described as a “distributed ledger”, is a secure protocol where a network of computers collectively verifies a transaction before it can be recorded and approved … the science is progressing so fast that the limitations are now less technical than they are legal, regulatory and ethical.

Table 1: Tipping points expected to occur by 2025

“Secular stagnation” describes a situation of persistent shortfalls of demand, which cannot be overcome even with near-zero interest rates.

The world’s population is forecast to expand from 7.2 billion today to 8 billion by 2030 and 9 billion by 2050.

We live in a society where more than a quarter of the children born today in advanced economies are expected to live to 100.

First, there is a destruction effect as technology-fuelled disruption and automation substitute capital for labour, forcing workers to become unemployed or to reallocate their skills elsewhere.

Employment will grow in high-income cognitive and creative jobs and low-income manual occupations, but it will greatly diminish for middle-income routine and repetitive jobs.

The fourth industrial revolution leads to significant “re-shoring” of global manufacturing to advanced economies, something very possible if access to low-cost labour no longer drives the competitiveness of firms.

In a world where boundaries are disappearing and aspirations are changing, people want not only work-life balance but also harmonious work-life integration. I am concerned that the future of work will only allow a minority of individuals to achieve such fulfillment.

Average lifespan of a corporation listed on the S&P 500 has dropped from around 60 to approximately 18.

87% of young people in the US say their smart phone never leaves their side and 44% use their camera function daily.

Agile governance means that regulators must find ways to adapt continuously to a new, fast-changing environment by reinventing themselves to understand better what they are regulating.

The availability of reliable internet infrastructure becomes a crucial prerequisite for a flourishing economy.

Some 90% of the population of low-income countries and over 60% globally are not online yet.

The critical danger is that a hyperconnected world of rising inequality may lead to increasing fragmentation, segregation and social unrest, which in turn creates the conditions for violent extremism.

Any networks or connected devices, from military systems to civilian infrastructure such as energy sources, electricity grids, health or traffic controls, or water supplies, can be hacked and attacked.

Half of all assets around the world are now controlled by the richest 1% of the global population, while “the lower half of the global population collectively own less than 1% of global wealth”.

Unequal societies tend to be more violent, have higher numbers of people in prison, experience greater levels of mental illness and obesity, and have lower life expectancies and lower levels of trust.

At the threshold of a radical systemic change that requires human beings to adapt continuously.

“A wealth of information creates a poverty of attention.”

“In an age of acceleration, nothing can be more exhilarating than going slow,” writes the travel essayist Pico Iyer.

Emotional intelligence is credited with allowing leaders to be more innovative and enabling them to be agents of change.

Academics who specialize in the study of emotional intelligence show that great decision-makers are differentiated from average ones by their level of emotional intelligence and capacity to cultivate this quality continuously.

Drawing from the Latin spirare, to breathe, inspired intelligence is about the continuous search for meaning and purpose.