The fourth industrial revolution is upon us
- By Xing Wen
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Big data, 3D printing, artificial intelligence – such new terms are springing up as emerging enterprises mushroom. In case you hadn't noticed, the Fourth Industrial Revolution, featuring integrated industrialization and informatization, is upon us.
Our future depends on being able to understand and positively shape this revolution to make it serve humankind as a whole. This was the main issue under discussion at the 10th Annual Meeting of the New Champions (also known as the Summer Davos Forum), held in Tianjin in June, by representatives from the political, business, and academic spheres.
Forthcoming challenges
"In past history, an economic downturn has usually been accompanied by an upsurge of innovation," Vice Minister of Industry and Information Technology Feng Fei said. According to his interpretation, the Fourth Industrial Revolution has occurred, in the wake of the financial crisis of 2008, under the backdrop of an in-depth merging of information technologies and manufacture techniques.
The revolution is expected to appreciably enhance productivity and reshape the future economic pattern. Large-scale customization will replace mass production, and the life cycle of an enterprise and its period of market control will relentlessly shorten. Meantime, this is an opportunity for the global economy to change its development modes. Owing to the effect of disruptive technologies, tools, and materials, traditional industries must now upgrade from overly depending on natural resources to being propelled by human resources and innovation.
"China formerly relied on its demographic dividend and mass production. However, this mode can no longer adequately respond to the advent of new challenges," warned Ma Weihua, president of the China Entrepreneur Club. Stimulated by the new industrial revolution, there is accelerated integration of the old and new growth drivers of China's economy. Traditional industries have made clear their limitations as regards bolstering high-speed economic growth. Taking into consideration rising costs, industries that are losing their competitiveness must now retreat smoothly and swiftly, so encouraging new industries to develop. The phasing out of outdated production capacity and addressing of overcapacity, therefore, is inevitable amid economic transformation. Although a hard nut to crack, this could unleash previously repressed demands while creating new industries, according to Professor Huang Yiping from Peking University's National School of Development.
In Ma Weihua's eyes, China's Achilles heel lies in its weak innovation and commercialization of technology, which impedes transformation and upgrade. His opinion is shared by Long Guoqiang, vice president of the Development Research Center of China's State Council. Long believes that transforming traditional industries with new technology is the solution as the Fourth Industrial Revolution advances, and that China's companies should shift to more capital- and technology-intensive sectors.
New growth drivers
Providing robust support for an economic transition requires further implementation of China's innovation-driven development strategy. Primary driver of development, innovation is encouraged both in new economy and traditional industries. In recent years, the Chinese government has made a strong call for technological and institutional innovation, implementing fiscal and tax incentives to support innovation and development of new industries. Meanwhile, the launch of differentiated industrial policies has promoted both the transformation of traditional industry and the progress of new ones. Boosted by action plans, including mass entrepreneurship and innovation, Internet Plus, and Made in China 2025, different, constantly integrating sectors accordingly give rise to new industries, new forms of business, and new business models.
To survive amid the new industrial revolution, a company should never cease technological innovation, and must be responsive to various changes in this era of Internet. Key factors in a successful transformation lie in custom-tailored and flexible production to meet consumers' diverse needs, improvements in production models, management and marketing, as well as reshaping of industry chains, supply chains, and value chains. Internet technology has made it possible to match massive amounts of supply and demand information. Besides, it facilitates cooperation among enterprises and the sharing of research and development as well as professional expertise and skills. Moreover, the Internet pools global intellect and resources towards offering solutions to various problems.
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