Business schools must lead the way in adapting to fourth industrial revolution

The world is in the middle of a revolution disrupting every industry in every country. The fourth industrial revolution (FIR) it is different to the previous three in terms of speed, scope and impact. It is a digital revolution, characterised by a fusion of technology impacting every aspect of how we work and live.

The FIR will be unlike anything humankind has experienced before. The response must involve all stakeholders: the public and private sectors, academia and civil society.

Automation, digital platforms and other innovations are changing the fundamental nature of work. The disruptive changes emanating from the FIR will have a profound impact on employment, business models and even business education.

The speed of current breakthroughs has no historical precedent. The breadth and depth of the FIR’s changes will transform entire systems of production, management and governance.

We cannot foresee yet which scenario is likely to emerge. In the future, however, talent, more than capital, will be the critical factor of production.

Skills that we learned in formal education are becoming irrelevant. With technology evolving so quickly, corporate education and training programmes are in desperate need of transformation. In addition to their traditional core curriculum, business schools should begin to focus on education in areas like computers, big data, artificial intelligence and designed thinking, to enable consistent training for all areas of business, especially in management and leadership.

The World Economic Forum (WEF) predicts the FIR will have four major impacts on business -in customer expectation, product enhancement, collaborative innovation and organisational forms. A new world of customer experiences, data-based services and asset performance through analytics require new forms of collaboration. The emergence of global platforms and other new business models mean that talent, culture and organisational forms need to be rethought. Companies must re-examine the way they do business.

Within the context of the FIR, emergent business education should aim to develop a student’s intellectual ability, executive personality and entrepreneurial and managerial skills. In addition, it needs to provide students with business education using best practices that take account for indigenous, entrepreneurial and societal context.

WEF founder Klaus Schwab says that, across all industries, there is evidence that technologies underpinning the FIR are having a major impact on businesses. Major shifts on the demand side are also occurring, as growing transparency, consumer engagement and new patterns of consumer behaviour force companies to adapt the way they design, market and deliver products and services.

A key trend is the development of technology-enabled platforms. These combine demand and supply to disrupt existing industry structures, such as those we see within the sharing or on-demand economy. These technology platforms, facilitated by the Smartphone, pull together people, assets and data — creating new ways of consuming goods and services.

A good example is ride-sharing. Uber is essentially a transport company with no vehicles of its own -but one that is disrupting the existing global network of taxi franchises and other transport operations.

However, neither FIR technology nor the disruption that comes with it is beyond our control. We are all are responsible for guiding its evolution, through our daily decisions as ordinary citizens, consumers and investors. We should grasp the opportunity to direct the FIR towards a future that reflects our common objectives and values.

To achieve this, business educators must develop a comprehensive, global view of how technology is affecting our lives and reshaping our environments. There has never been a time of greater promise, or one of greater potential peril. Today’s decision-makers, however, are often trapped in traditional, linear thinking or too absorbed by the multiple crises demanding their attention, to think strategically about the forces of disruption and innovation shaping global business.

The task of embracing the FIR and ensuring that business leaders and professionals have the skills to take their companies into a sustainable economy is potentially the most pressing challenge business education will face over the next few years. It will have to be geared towards educating students about the need to adapt in the current marketplace and stay relevant. Business-as-usual is no longer an option.

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