In the thick of the opportunity revolution – ITWeb

There is much media hype around the fourth industrial revolution (4IR) and what it will hail for social and economic development. It is defined as a fusion of advances in artificial intelligence (AI), robotics, the internet of things (IOT), genetic engineering, quantum computing, and more.

One thing is clear: the world is not on the brink of a technological revolution that will fundamentally alter the way we live, work and relate to one another but rather we are in the thick of it.

This is borne out by research, with one Statista study forecasting the number of IOT devices worldwide will triple from 8.74 billion in 2020, to more than 25.4 billion IOT devices by 2030. The same study noted that in 2020, the highest number of IOT devices was in China, at 3.17 billion devices.

IOT devices are used in all types of industry verticals and consumer markets, with the consumer segment accounting for around 60% of all IOT connected devices in 2020. This share is projected to stay at this level over the next 10 years.

The most important use cases for IOT devices in the consumer segment are internet and media devices such as smartphones, where the number of IOT devices is forecast to grow to more than eight billion by 2030. Other use cases with more than one billion IOT devices by 2030 are connected (autonomous) vehicles, IT infrastructure, asset tracking plus monitoring and smart grid applications.

Unpacking 4IR, IOT and technology spending

The first industrial revolution used water and steam power to mechanise production, while the second used electric power to create mass production, and the third utilised electronics and information technology to automate production.

Now the 4IR has taken the innovations of the third and built on them to create the digital revolution that has been occurring since the middle of the last century. It is said to be characterised by a fusion of technologies that is blurring the lines between the physical, digital and biological spheres.

Today's transformations represent not merely a prolongation of the third industrial revolution, but rather the arrival of a fourth and distinct one.

The speed of current breakthroughs has no historical precedent, as when compared with previous industrial revolutions, the fourth is evolving at an exponential pace.

The speed of current breakthroughs has no historical precedent, as when compared with previous industrial revolutions, the fourth is evolving at an exponential pace. Moreover, it is disrupting almost every industry in every country, with the breadth and depth of these changes heralding the transformation of entire systems of production, management and governance.

So, what exactly is the 4IR? According to the World Economic Forum (WEF), it is a new era that builds and extends the impact of digitisation in new and unanticipated ways. In other words, it is the convergence of technology, digital, data and artificial intelligence that brings about new and unanticipated ways of working, living and engaging, such as in a metaverse.

It can also be said to be about the internet of everything from fitness trackers to the smart thermostats used both commercially and in homes, to the fleet-management solutions that tell us when our packages will arrive IOT is now embedded in the lives of consumers, as well as the operations of enterprises and governments.

IOT is the holy grail of innovation in the 21st Century, as predicted by everyone from McKinsey to Gartner. It largely started with the invention of the cloud and has since accelerated with the advances in both communication technology as well as new engineering innovation of IOT devices.

In a world where many companies suffer revenue declines, it is clear that IT spending is accelerating ahead of revenue expectations. According to Gartner, technology spending has entered a new build budget phase, with worldwide IT spending projected to total $4.2 trillion by the end of 2021, which represents an increase of 8.6% over 2020.

The research team goes on to note that CIOs are looking for partners that can think past the digital sprints of 2020 and be more intentional in their digital transformation efforts in 2021.

Boards and CEOs are much more willing to invest in technology that has a clear tie to business outcomes, and less so for everything else. For example, the IT services segment is among the top three highest growth areas for 2021, primarily due to a boost in infrastructure-as-a-service spending that supports mission-critical workloads and avoids high on-premises costs. The IT services segment is forecast to total $1.2 trillion in 2021, an increase of 9.8% over 2020.

However, IOT is not a panacea for all business ills according to McKinsey, IOT has faced headwinds related to change management, cost, talent and cyber security, particularly in enterprises.

With this level of investment there are unquestionably opportunities for South African businesses capable of identifying and capitalising on them. IOT start-ups need to focus on finding the right strategic partnerships that are based on mutually acceptable values of trust and respect.

In my next article, I will expand on the state of SA's readiness for the 4IR.

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In the thick of the opportunity revolution - ITWeb