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Networks and the Fourth Industrial Revolution

In the late 1700s a fundamental shift was occurring in much of the world. Had you been alive at that time you would have undoubtedly been amazed how advances in steam, water, and mechanical production equipment was increasing productivity in agriculture and extraction industries. Then, by the 1870s, it was electricity, division of labor, and the capacity for mass production that was reshaping much of the world. In the 1970s we saw continued transformation through electronics, information technology, and automated production. These three eras are often referred to as the three great industrial revolutions.

This article makes the case that the world is in the now in the early stages of the fourth industrial revolution, one that represents another fundamental shift in how we produce and consume goods, and relate to one another. It also suggests that these changes are demanding an increased level of collaboration across sectors, disciplines, and organizations. Although we’ve not yet effectively articulated what this fourth revolution really is, many are framing it in terms of cyber-physical systems. Another way to think of it is as the convergence of digital, human and physical domains.

The digital domain has seen a transition from software used primarily to serve as practical tools that help us write documents and design spreadsheets, to an environment in which an increasing number of major enterprises and entire industries are being completely run on software and delivered as cloud-based solutions.

The second domain is the human one. In the last industrial revolution we saw personal, interactive technologies became commonplace. In the fourth industrial revolution we are literally merging and adapting our human bodies with technology. The cyborg, once a product of science fiction, becomes more real each day.

In the third domain, the natural and physical environments around us, we are far more aware and in control of these environments because of sensors and data science. The Internet of Things (IoT) that is digitizing our physical world and continuous steams of data, is giving us new insights into the world around us.

This unprecedented ability to connect anything with anything and the convergence of previously separate domains is also fundamentally changing the way we innovate and create both social and market value. Both power and knowledge are diffused, making collaboration more important than ever before. This fourth wave will give birth to new products, services, businesses, and industries that we can’t even imagine today. For organizations that already exist in the third transformation, transitioning to the fourth will be necessary for survival.

Recognizing strategic opportunities and mobilizing the needed networks to take advantage of those opportunities is a requirement in the fourth industrial revolution. We need leaders with a set of skills fit for this new reality. In the fourth revolution value is being created in horizontal networks not in vertical hierarchies. We will need to work together across sectors, disciplines, organizations and political boundaries. This requires new models of strategy and collaboration. We believe that Strategic Doing is one of those models.

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This article is from the free online course:

Introduction to Strategic Doing: An Agile Approach to Strategy

Purdue University

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