Are Australian businesses really 4IR ready?

The fourth industrial revolution (4IR), is upon us and affecting almost every industry globally, transforming how organisations operate and shaping a world where consumers are enabled and empowered by digital technologies, platforms and processes. But is Australia and its business community well placed to succeed in an environment of transformative technologies, automation and human-machine interaction?

Are Australian businesses really 4IR ready?

To date, the revolution has been driven by accelerating technology innovation, data-enabled industry, cyber-physical convergence, and individual expectations for tailored offerings. Well-established examples of these connections between the physical and the digital worlds include analytics, robotic automation, cyber security and business-intelligence, with uptake of evolving innovations like artificial intelligence and machine learning, advanced wireless networks and block chain also on the increase.

In 2018 the World Economic Forum concluded that Australia, thanks to its willingness to adopt new technologies, ability to ideate and educated workforce, is strongly positioned to prosper within the integrated digital economies of the future. But, of course, being positioned for success and being able to actually realise it can be very different.

CSIRO research found Australia to be ‘lagging behind’ other OECD countries in capturing the full economic potential of science and innovation, and it’s been observed that many local organisations are underestimating the pace, reach and implications of the 4IR. We have uneven opportunity exploitation across our industries, with mining automation and digital banking efforts world-leading, but plenty of room for digitised value chain overhaul present in utilities, healthcare, retail and the arts, to name but a few. A documented shortfall in understanding around how best to harness the tools and techniques necessary to achieve global competitiveness, by boosting innovation, speed to market and productivity, may explain why.

In fact, as revealed by a February 2020 KPMG report, less than half our business leaders have beyond a basic understanding of what the 4IR actually is. Those that do expect a higher level of impact on their organisations in terms of people and their skills, processes and technology, confirming that corporate education is crucial to ensuring leaders are able to adapt to and prepared to navigate through these times of change. The carrot in this context is that a performance gap has been noted between enterprises that have invested in applying technologies and strategies to achieve digital transformation, and those that are still competing in traditional ways, regardless of their scale or age.

So, as well as education, what else needs to happen or change to allow Australian businesses to capitalise on the country’s revolution-ready characteristics? How can they facilitate their own transitions and those of their industries, to invite prosperity and innovate towards it on a global as well as local level?

Cohesive national strategies and standards will prove broadly beneficial to pulling in the direction of progress, assuming they can facilitate cooperation around emerging platforms between companies, industries and institutions. But when it comes to businesses themselves, specific 4IR strategies which balance technology integration with securing capable people and staff skills development are likely to prove most productive, especially when paired with corporate responsibility which extends beyond shareholders to include customers, employees, suppliers, and communities. Deloitte discovered almost 70 per cent of those with comprehensive strategies have made a great deal of progress against their goals in recent years, versus 10 per cent without.

In forming timely, competitive strategies, companies need to avoid delaying the automation of relevant areas and prioritise what to pursue and when to pivot in the midst of so much newness. They also need to accept that fundamentally rethinking approaches and recreating processes rather than just updating them will prove essential to these efforts to get ahead – being ready to think counter-intuitively and willing to fail to learn, inform and refine at speed will serve them well. Building brand new business models which are customer and quality centric, flexible, swift, and sustainably efficient, rather than just updating established ones, is key. So too is focusing on people as much as tech in order to realise the benefits of an agile, adaptable workforce equipped to respond to the ever-evolving demands of fast-moving modern markets.

Central to this is cultivation of a lifelong learning culture supported by clear direction, suitable resources and investment in professional upskilling which is built for practical industry purpose. This allows employers to develop specific and innovative 4IR personnel strategies which make recruiting, retaining and reskilling increasingly efficient and effective. It also empowers team members of all types with clarity around how to proactively look towards future roles and responsibilities in a way that keeps them relevant and valuable.

The optimum mix of skills for Australian workers will be multi-faceted and highly transferable, to safeguard against exposure to tech skills which are shifting at speed and have a limited relevance window. They will span IT-related competencies and more malleable, humanistic capabilities founded on judgement, compassion, collaboration, creativity and communication. And our most valuable leaders will be those committed to identifying and enhancing the transformative ability and willingness of teams, adept at aligning digital and physical assets, and expert at assessing and integrating new approaches as they inevitably present themselves.

Viva la revolution.

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