"We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before. We do not yet know just how it will unfold, but one thing is clear: the response to it must be integrated and comprehensive, involving all stakeholders of the global polity, from the public and private sectors to academia and civil society."
That technological revolution is known as the Fourth Industrial Revolution. A plethora of macro forces are converging - and this is placing intense pressure on organisations and the leaders at their helm.
Many experienced business leaders may be tempted to understand these advancements as the linear progression of the technological changes we've seen in the latter half of the twentieth century. However, evidence suggests that the speed, scope and impact of change will go beyond anything we've encountered before.
Against this backdrop, BIE carried out a survey of over 150 business leaders, to find out how they are responding to the current disruptive environment.
Change is the new normal…
…and it has been for a while. Organisations are being shaken to their very core as they discover that their old systems and processes are no longer as fit for purpose as they once were. To remain in the race, companies must adapt and flex to overcome the challenges ahead.
Schwab writes: "Overall, the inexorable shift from simple digitisation (the Third Industrial Revolution) to innovation based on combinations of technologies (the Fourth Industrial Revolution) is forcing companies to re-examine the way they do business. The bottom line, however, is the same: business leaders and senior executives need to understand their changing environment, challenge the assumptions of their operating teams, and relentlessly and continuously innovate."
This can be a daunting reality to face. In fact, 58 per cent of survey respondents said that they find the speed and scale of change, required to remain competitive, overwhelming.
However, there is a lot of optimism as well. 53 per cent of respondents think the digital revolution will have a positive impact on their organisation. Furthermore, 41 per cent think that globalisation and a hyper-connected world population will also have a positive impact.
The main concerns revolve around preparedness and the capacity to successfully embrace this new era. For instance, although there is acknowledgement of the need to focus on creating adaptive organisations, with 45 per cent of leaders highlighting this as a concern, only 21 per cent have a clear vision for creating a responsive business. And just 9 per cent think leaders are completely equipped to lead business growth in this environment.
Creating adaptable businesses
We all need to cast off the mantles we have worn in the past. It is crucial for us to challenge the status quo on an individual and organisational level and ensure we have the right mindset and skillset to constantly adapt. Exhibiting this understanding, 57 per cent of respondents said they are open to change and aware of the need to adapt to achieve competitive advantage - although, a staggering 76 per cent of respondents are concerned about whether their senior team has the right skillset and mindset to lead growth in these complex conditions.
Klaus Schwab identifies four specific ways in which the Fourth Industrial Revolution will have a bearing on businesses: "On customer expectations, product enhancement, collaborative innovation, and on organisational forms."
Clearly, the Fourth Industrial Revolution will bring with it many unique and complex challenges – the majority of which we cannot even begin to comprehend. The ability to understand this and then face up to it will enable leaders to chart their route to prosperity.
So how should todays business leaders deal with these challenges to achieve success?
We explore the general response from business leaders to the current environment in the eBook, Creating Adaptable Businesses. In it, thought leaders and practitioners offer their take on the Fourth Industrial Revolution and how organisations might adapt to thrive in a constantly-shifting world.