Davos 2016: Why you can’t afford to ignore the fourth industrial revolution – and how data must become essential to your business
There's been one phrase on everyone's lips at this year's World Economic Forum: the fourth industrial revolution.
Definitions differ on what exactly it is, but one thing we can all agree on is that the fourth industrial revolution is here and it is happening a lot faster than many of us ever imagined.
While the first industrial revolution brought about a period of innovation that lasted over 100 years, each subsequent revolution lasted less than half as long as the one that preceded it, as the pace of innovation accelerates.
As the fourth industrial revolution gathers pace, it is bringing immense change at a speed, scale and force that is hard to comprehend.
The interconnected world is dramatically changing the way we share, analyse and process information and will have far-reaching political, societal and economic consequences for all of us.
With new technologies emerging at such an accelerated rate, businesses must act now if they are to survive and thrive.
Do or die
Amid the flurry of technology innovations and changes in user behaviour it can be difficult to know which trends will last and which technologies are worth investing in.
However throughout all of this there is one constant element: information. Businesses are increasingly recognising the importance and value of data. In fact, as Ann Winblad said so succinctly: ‘data is the new oil.’
Data is fast becoming a good without which businesses cannot succeed. Data is at the centre of everything we do. Every transaction, interaction, experience or development is not without a digital footprint.
Now businesses are smarting up to how this data can create new revenue streams and fuel new digital economies. For example, the data collected from smart, connected cars might be accessed by insurance companies in the future, possibly affecting our insurance premiums.
Data from our smartphones, meanwhile, paints a picture of who we are, what we like to purchase and where we like to visit. An iPhone alone has 32 sensors built in.
All of this data provides valuable fodder for e-commerce and marketing organisations that want to sell us targeted goods and services. However this is also very personal information. Data, just like oil, is an incredibly valuable asset and it must be properly protected.
A new battleground
Just like the gold rush in the 19th century, enterprising individuals and businesses have recognised that there are great spoils to be had from capturing and monetising data. As its value is set to climb as the fourth industrial revolution takes hold those that act quickly, will have a head-start against the competition.
Just like other valuable assets, like gold or oil, data must be protected. Not only can data loss hit businesses corporate reputations, it can hit the bottom line. According to the CEBR, businesses in the UK face financial losses as high as £34bn annually as a result of data leaks.
To prepare for this new paradigm, businesses must build a robust culture and infrastructure for data security awareness and ensure compliance with data privacy regulations. Data lies at the heart of the fourth industrial revolution and businesses that are quick off the mark to recognise that will be the ones that are still here when we start talking about what comes next.