The First Industrial Revolution used water and steam power to mechanise production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production.

The Fourth Industrial Revolution builds on the third, the digital revolution, that has been occurring since the middle of the last century.

Best characterised by a fusion of technologies that is blurring the lines between the biological, digital and physical spheres; we have embraced it wholly, and it has fundamentally altered the way we live, work, and relate to one another. The scale, scope, and complexity of the transformation have been unlike anything humankind has experienced before.

And just like the revolutions that preceded it, the Fourth Industrial Revolution has the potential to raise global income levels and improve the quality of life for populations around the world. But let’s reflect on our own behavioural change and market expectation over the past decade.

Thus far, we, the consumers have tapped technology to increase the efficiency and pleasure of our personal lives — from requesting rides (GoJek), ordering in (Deliveroo), purchasing groceries (RedMart), making payments (GrabPay), watching films (Netflix), playing games (Sea) or simply communicating with each other (WhatsApp) — any of these can now be done remotely. Even more so, as we navigate life under the cloud cover of a global pandemic that is the COVID-19 virus.

And in general, the response has mostly been comprehensive and integrated, involving stakeholders of the global polity, from the public and private sectors, and to academia and civil society.

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From linear to circular

However research by McKinsey & Company shows a big shift across all industries, and the breadth and depth of these changes herald the transformation of entire ecosystems of governance, management and production. When compared with previous industrial revolutions, the Fourth is evolving at an exponential, rather than a linear pace.

In fact, the team of Andreas Waschto, Tanguy Catlin, Jahnavi Nandan, Johannes-Tobias Lorenz, and Shirish Sharma from McKinsey & Company in their article predict that ecosystems will account for 30 per cent of global revenues by 2025.

Moreover, the actual composition and shape of these ecosystems will vary by country and region, both because of the effects of regulations and as a result of more subtle cultural customs and tastes.

But what it means for businesses is that putting customers at the centre of every digital activity will help drive scaled adoption and capture previously unimagined value. You only have to look at Amazon, Facebook, Grab and Alibaba, as examples.

How does this affect us as individuals or even employees or business owners, you ask? Well in our new, multi-dimensional connected world, we are already moving from linear to circular, participatory value models. However, most organisations are still comfortable in traditional processes, where the buyer captures value by consuming the product or service.

On the other hand, is a true circular, participatory value model, a distributed, decentralised value mechanism, embedded within the whole ecosystem, with value creation through a collaborative effort, comes into play.

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In fact, if your organisation has been forced to move to a remote way of interacting with clients, this might be the perfect opportunity for you to involve the team in the build of their own bespoke version of this new, multi-dimensional world.

The eventual goal for organisations to thrive in this world would be to create a platform of co-creation, co-sharing and co-distribution among collaborating parties, as an “open value sharing” process, acting as an ongoing circular and participatory value model, as outlined by Annabeth Aagaard in her book Digital Business Models: Driving Transformation and Innovation.

If we reflect on which organisations are more of an ecosystem and less of a product-driven organisation, one might argue that product-driven “works”, as there are experts who spend years developing them. According to Kevin Kelly in his book The Inevitable: Understanding the 12 technological forces that will shape our future, another way of exploring this is by shifting towards creating an ecosystem that is “governed by co-evolution, which is a type of biological co-dependence, a mixture of competition and cooperation, where one’s success hinges on the success of others.”

That way, we will move away from just a core of experts, which can be deemed as stagnant, to a combination of a core while harnessing the power of a crowd, which is constantly, and dynamically, evolving.

What happens then?

In their paper –The importance of Non-Hub Elements – researchers Azusa Minamizaki and Euan McKay, argue that for organisations to thrive in the fourth industrial revolution, the “core” could be distributed at various sections of the highest centrality across the globe which is then able to develop active and scalable networks.

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According to Professor Matthew Jackson who authored the book The Human Network: The Science Behind our Hidden Positions in Life, such a network is known as the Eigenvector Centrality Network which relies on the measure of influence and strength within a network instead of relying only one individual as opposed to:

• Degree centrality: reliant on an individual being able to get a message out to millions of followers on a social medium gives a person the potential to influence what many people think or know. (extremely traditional), or
• Diffusion centrality: reliant on how well-positioned is a person to spread information and to be one of the first to hear it. Not a very scalable approach.

Simply put, “It’s not what you know, it’s who you know”, or so the old adage goes. Professor Jackson shows us through his ground-breaking research that the relationships in school, university, work and society have extraordinary implications throughout our lives.

By understanding and taking advantage of these networks, we can boost our happiness, success and influence. But there are also wider lessons to be learnt.

Ultimately, the ability of organisations to adapt will determine the survival of the Eigenvector Centrality Network. If they prove capable of embracing a world of disruptive change, subjecting their structures to the levels of transparency and efficiency that will enable them to maintain their competitive edge, they will endure. If they cannot evolve, they will face increasing trouble.

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As the growing possibilities of billions of people connected by mobile devices, with unprecedented processing power, storage capacity, and access to knowledge, are unlimited. Then suffice to say that the world is changing towards relying and creating access to infinite experts around the world, instead of depending on a finite few as we have done so in the past.

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