Why Canadian Manufacturers Need To Understand – And Embrace – The Fourth Industrial Revolution


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Although helping the Canadian manufacturing sector accelerate growth obviously requires looking towards the future, Craig Holden recently pointed to an important lesson from the past.

The president and CEO of Vancouver-based engineering consultancy Panevo harkened back to a time when steam-powered manufacturers were first introduced to electrification. Despite all the benefits, he said there was probably some degree of pushback among firms in the sector.

“That sounds crazy now, but humans don’t like change,” said Holden, speaking in a webinar hosted by NGen and featuring speakers from Salesforce and other organizations.

Change, in this case, refers to the transition of manufacturing as we know it in Canada today and the Fourth Industrial Revolution — a blurring of boundaries between the physical, digital, and biological worlds.

It’s a fusion of advances in artificial intelligence (AI), robotics, the Internet of Things (IoT), 3D printing, genetic engineering, quantum computing, and other technologies. It’s the collective force behind many products and services that are fast becoming indispensable to modern life.

This term is often closely associated with smart factories, where many of these innovations manifest themselves and introduce new business processes that transform organizations and unleash new capabilities in the people who work within them.

As a result of this perfect storm of technologies, the Fourth Industrial Revolution is paving the way for transformative changes in the way we live and radically disrupting almost every business sector. It’s all happening at an unprecedented, whirlwind pace (and it’s why Salesforce built the Customer Success Platform to keep up with changing customer expectations).

As Holden said, “The Canadian manufacturing core needs to not only embrace factory 4.0 and smart factory, but also lead on it.”

To that end, here’s everything you wanted to know about the Fourth Industrial Revolution (but were afraid to ask).

Where did the term “Fourth Industrial Revolution” come from?

While the Fourth Industrial Revolution (sometimes called the 4IR or Industry 4.0) is set to change society like never before, it builds on foundations laid by the first three industrial revolutions. The advent of the steam engine in the 18th century led to the first industrial revolution, allowing production to be mechanized for the first time, and driving social change as people became increasingly urbanized.

In the second industrial revolution, electricity and other scientific advancements led to mass production. A third industrial revolution, beginning in the 1950s, saw the emergence of computers and digital technology. This led to the increasing automation of manufacturing and the disruption of industries including banking, energy, and communications.

The changes are so profound that, from the perspective of human history, there has never been a time of greater promise or potential peril.

The person who labeled today’s advances as a new revolution was Klaus Schwab, founder and executive chairman of the World Economic Forum and author of the book, The Fourth Industrial Revolution. In a 2016 article, Schwab wrote that “like the revolutions that preceded it, the Fourth Industrial Revolution has the potential to raise global income levels and improve the quality of life for populations around the world.”

He continued: “In the future, technological innovation will also lead to a supply-side miracle, with long-term gains in efficiency and productivity. Transportation and communication costs will drop, logistics and global supply chains will become more effective, and the cost of trade will diminish, all of which will open new markets and drive economic growth.”

It’s not all good news, however. Schwab also suggested the revolution could lead to greater inequality, “particularly in its potential to disrupt labor markets.” Furthermore, the job market may become increasingly segregated into “low-skill/low-pay” and “high-skill/high-pay” roles, which could escalate social tension.

According to Schwab, “The changes are so profound that, from the perspective of human history, there has never been a time of greater promise or potential peril.”

From a local perspective, a report from Canada’s Economic Strategy Tables suggests that Industry 4.0 applications will generate $1.2-$3.7 trillion of global economic value by 2025.

What are the technologies driving change?

The easiest way to understand the Fourth Industrial Revolution is to focus on the technologies driving it. These include the following:

Artificial intelligence

AI describes computers that can “think” like humans. They can recognize complex patterns, process information, draw conclusions, and make recommendations. AI is used in many ways, from spotting patterns in huge piles of unstructured data to powering the autocorrect on your phone.


Blockchain is a secure, decentralized, and transparent way of recording and sharing data, with no need to rely on third-party intermediaries. The digital currency Bitcoin is the best known blockchain application. However, the technology can be used in other ways, including making supply chains traceable, securing sensitive medical data anonymously, and combating voter fraud.

Faster computer processing

New computational technologies are making computers smarter. They enable computers to process vast amounts of data faster than ever before, while the advent of the cloud has allowed businesses to safely store and access their information from anywhere with internet access. Quantum computing technologies now in development will eventually make computers millions of times more powerful. These computers will have the potential to supercharge AI, create highly complex data models in seconds, and speed up the discovery of new materials.

Virtual reality and augmented reality

What’s the difference? VR offers immersive digital experiences (using a VR headset) that simulate the real world, while augmented reality (AR) merges the digital and physical worlds. Examples include L’Oréal’s makeup app, which allows users to digitally experiment with makeup products before buying them, and the Google Translate phone app, which allows users to scan and instantly translate street signs, menus, and other text.


Biotechnology harnesses cellular and biomolecular processes to develop new technologies and products for a range of uses, including developing new pharmaceuticals and materials, more efficient industrial manufacturing processes, and cleaner, more efficient energy sources. Researchers in Stockholm, for example, are working on what is being touted as the strongest biomaterial ever produced.


Robotics refers to the design, manufacture, and use of robots for personal and commercial use. While we’re yet to see robot assistants in every home, technological advances have made robots increasingly complex and sophisticated. They are used in fields as wide-ranging as manufacturing, health and safety, and human assistance.

The Internet of Things

The IoT describes everyday items — from medical wearables that monitor users’ physical condition, to cars and tracking devices inserted into parcels — connected to the internet and identifiable by other devices. A big plus for businesses is that they can collect customer data from constantly connected products, allowing them to better gauge how customers use products and tailor marketing campaigns accordingly. There are also many industrial applications, such as farmers putting IoT sensors into fields to monitor soil attributes and inform decisions such as when to fertilize.

3D printing

3D printing allows manufacturing businesses to print their own parts, with less tooling, at a lower cost, and faster than via traditional processes. Plus, designs can be customized to ensure a perfect fit.

And more

Innovative materials, including plastics, metal alloys, and biomaterials, promise to shake up sectors including manufacturing, renewable energy, construction, and healthcare.

Energy capture, storage, and transmission represent a growing market sector, spurred by the falling cost of renewable energy technologies and improvements in battery storage capacity.

How will the Fourth Industrial Revolution affect business?

As these technologies change what’s possible, they will allow Canadian manufacturers to make better use of their resources. According to Industry Canada, for instance, automated tools can lower maintenance expenses from 10-40%.

Smart factories can also transform customers’ expectations. A global survey from Salesforce Research shows that a majority of those surveyed believe that these technologies — and the experiences they enable — will transform their interactions with companies within five years.

Nowhere will this be more evident than in customer experience. With technology enabling businesses to offer greater personalization and more valuable, connected experiences across bricks-and-mortar and online channels, customers already have more options than ever, and they’re not afraid to switch brands for a better experience.

As data becomes the currency of our digital lives, companies must ensure the privacy and security of customer information.

The research shows about half of customers say most companies fall short of their expectations for great experiences, while 76% report that it’s easier than ever to take their business elsewhere.

Among the things customers regard as being “very important to winning their business” are connected processes, such as contextualized engagement based on earlier interactions (70%), and tailored engagement based on past interactions (59%).

This means businesses must focus more than ever on delivering a customer experience that differentiates them from competitors. Get it wrong and they risk losing more than just the sale — 57% of customers have stopped buying from a company because a competitor provided a better experience. What’s more, 62% say they share bad experiences with others. With peer review sites and social media offering unhappy customers a greater audience for complaints, this can damage a company’s reputation.

Because customers today expect personalized experiences, collecting quality data is more important for businesses than ever. Unfortunately, the research also found that 57% of customers are uncomfortable with how companies use their personal or business information. Almost two-thirds (62%) are more afraid of their data being compromised now than they were two years ago.

To keep customers’ loyalty, companies need to not only deliver exceptional sales and service in brick-and-mortar stores and online, but also prove that they have customers’ best interests at heart.

Salesforce Chairman and Chief Executive Officer Marc Benioff believes a “trust revolution” is needed if businesses are to fully embrace the potential of the Fourth Industrial Revolution.

Customers today expect personalized experiences; collecting quality data is more important for businesses than ever.

“Deploying AI will require a kind of reboot in the way companies think about privacy and security,” he said. “AI is fueled by data. The more the machine learns about you, the better it can predict your needs and act on your behalf. But as data becomes the currency of our digital lives, companies must ensure the privacy and security of customer information. And, there is no trust without transparency — companies must give customers clarity on how their personal data is used.”

How will the Fourth Industrial Revolution affect the future of work?

Nowhere is the upheaval of the Fourth Industrial Revolution more likely to be felt than in the workplace. As with previous industrial revolutions, the Fourth Industrial Revolution will profoundly affect people’s lives as AI and increased automation see many types of jobs disappear. At the same time, entirely new categories of jobs are emerging.

Strategic business and technology advisor Bernard Marr said that computers and automation will come “together in an entirely new way, with robotics connected remotely to computer systems equipped with machine-learning algorithms that can learn and control the robotics with very little input from human operators.”

He added, “Industry 4.0 introduces what has been called the ‘smart factory,’ in which cyber-physical systems monitor the physical processes of the factory and make decentralized decisions.”

As the Fourth Industrial Revolution reshapes the future of work, businesses must prepare their people for the new world that lies ahead. This often means an increased focus on continual learning, upskilling to new types of jobs, and a commitment to diversity.

What should businesses do to future-proof their workforces?

Businesses will need to ensure they have the right mix of skills in their workforce to keep pace with changing technology. Another study shows that 59% of hiring managers believe that AI will impact the types of skills their companies need. Workers will more than likely need to update their skills, not just once but many times throughout their careers. Many senior executives are already asking how all this will be achieved.

As AI begins to impact the workforce and automation replaces some existing skills, we’re seeing an increased need for emotional intelligence, creativity, and critical thinking.

Ebony Frelix, executive vice president and chief philanthropy officer at Salesforce.org, addressed the issue as part of a panel discussion at Dreamforce ’18, where she said businesses and governments need to share responsibility for upskilling workers. In the Fourth Industrial Revolution, she said, it will be important to create nontraditional pathways for building skills. One example is Salesforce’s Pathfinder training program, created in 2017 in partnership with Deloitte.

According to Tom Puthiyamadam, global digital services leader with PwC’s Advisory practice, it’s imperative that businesses build their capacity to innovate and be agile. “Think about it as a sort of ‘no-man-or-woman-left-behind’ policy,” he said. “Don’t just hire new talent — because if you don’t create an internal environment where they can thrive, they’ll fail. Instead, build a holistic solution.”

“Companies need to be thinking about enabling their employees to code in new languages, but also to change their mix of soft skills,” added Zvika Krieger, co-leader of the World Economic Forum’s Center for the Fourth Industrial Revolution.

“As AI begins to impact the workforce and automation replaces some existing skills, we’re seeing an increased need for emotional intelligence, creativity, and critical thinking.”

How do we ensure the Fourth Industrial revolution is good for everyone?

With the Fourth Industrial Revolution presenting both immense opportunities and challenges, it’s up to all of us to work together to ensure that it benefits everyone.

Bernard Marr writes that, “Humans must be proactive in shaping this technology and disruption. This requires global cooperation and a shared view of how technology is reshaping our economic, social, cultural, and individual lives.”

With businesses at the forefront of the Fourth Industrial Revolution, driving both innovation and social disruption, they must also play a pivotal role in ensuring that the needs of all stakeholders are met, and not just those of shareholders.

In Canada, that may require what a recent report from Deloitte called an “ecosystem approach.” In other words, Deloitte said Canadian manufacturers might “collaborate with those in the hardware, software, cybersecurity, and cloud-computing fields, with the goal of equipping each with the tools needed to overcome their specific business challenges.”

With fears about job security and how personal data is used creating a crisis in trust,” businesses also need to demonstrate to consumers that their values and intentions are trustworthy. As Nick Davis, head of society and innovation at the World Economic Forum, and Simon Mulcahy, chief innovation officer at Salesforce, have written, “Solving the dilemma depends on a company’s ability to convince its customer that it’s using technologies in responsible and trustworthy ways that will benefit them.”

Identifying businesses as “incredible platforms for change,” Marc Benioff wrote for the World Economic Forum that “every business leader can have a direct role in creating economic opportunity for millions of people by investing in education and training programs for existing and potential talent.

“Every business leader can have a direct role in creating economic opportunity for millions of people by investing in education and training programs for existing and potential talent.”

Pointing to companies such as Dow, IBM, and Siemens, which are already investing in programs to help people to acquire new skills, Benioff called on CEOs to do more to “build the workforce of the future, while bringing along the workforce of today.”

“In the coming decades, we need to establish guardrails that keep the innovations of the Fourth Industrial Revolution on a track to benefit all of humanity. We can all individually have a direct role in shaping our future, and creating economic opportunity for millions of people by investing our time and resources in helping others.”

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