Recently, Trends e-magazine published a report that threads together the four phases of what they see as the ongoing continuum of the Industrial Revolution. They defined phase one as the period from about 1770-1870 – think machines, railroads, bridges and intra-national connections. The second phase was the following century, roughly 1870-1970, and encompassed first the steel revolution and later the mass-production revolution.
Their Third Industrial Revolution “was propelled by the rise of the Digital Age,” which created even more sophisticated automation and connectivity based on microprocessors and the Internet. That phase started in the 1970s, and Trends editors refer to this as the “installation phase,” where in each revolution’s phase, the big profits are made by tech companies – be they chipmakers or railroad companies.
The newest wave, what they call the Fourth Industrial Revolution is being driven by “extreme automation and connectivity.” Here, think practically free computing (open-source, cheap tools, etc.) coupled with almost unlimited bandwidth. The future implications of A.I. (artificial intelligence) and ‘big data’ will only deepen the penetration and effects. In this new “Deployment Phase,” the big profits will come “from companies imaginatively using the core technology, rather than creating it. This will occur in everything from healthcare to agribusiness to professional services.
The transformation of manufacturing taking place today has been noted by McKinsey and BCG as the next phase in the digitization of manufacturing and is being driven by four key ‘disruptions’:
- The astonishing rise in data volumes, computational power and wide area networks.
- The emergence of analytics and business intelligence (B.I.) capabilities.
- New forms of human-machine interaction, like touch interfaces and augmented reality.
- Improvements in transferring digital instructions to the physical world, like robotics and 3-D printing (of which we’ve written several times here previously).
Trends editors see these as the logical next steps of three prior stages:
- Lean in the 1970s
- Outsourcing in the 1990s
- The automation wave of the 2000s
Together these changes will transform real-world manufacturing – and actually, already are. In big data, new sensors help gold producers in Africa increase yields by 4%… in advanced analytics, configurators coupled with purchasing data help a big car-maker identify which options customers are willing to pay for, thus reducing possible combinations by three orders of magnitude and reducing costs dramatically… Man-machine interfaces help a German firm develop systems for order picking that use augmented reality headsets to locate items more quickly and precisely with both hands free, while integrated cameras capture serial and lot numbers that reduce errors by 40%… and finally, digital transfer systems allow a new car company called Local Motors to build cars almost entirely through 3-D printing with designs crowdsourced from its online community, while Fiat and GM use it for rapid prototyping and minimizing time to market.
In other words, the future is already here.