Why Trump must get ready for Industry 4.0

Why Trump must get ready for Industry 4.0

Donlad Trump, the new president of US, has promised to bring an industrial revolution to the US, and may affect the global village. Yet this revolution, which is called "Industry 4.0", may not only bring prosperity. What may the US expect? And what must President Trump keep in mind?

By Eli Pelleg, COO, and Shir Fuchs, Consultant

Industry 4.0 - illustration

Ever since Donald Trump was elected as the new president of the US, countless critics, economists and journalists have been trying to figure out the new president-elect's complexed, unexpected personality. The future in Trump's hands is extra difficult to predict, specifically when it comes to Industry 4.0 - the fourth industrial revolution.

Trump has earned a great responsibility at a crucial time in human history, as he has the power to take great advantage of the revolution to come, and lead the US and the world to flourish in the near future. During his campaign Trump promised to bring production back to the USA and to provide major bonuses on domestic production. With that, Trump's long term vision remains vague, as it is unclear if his future plans are based on his profound understanding of the industrial and employment landscape or are merely a winning political play.

Indefinite words can be written about Industry 4.0; there is more to describe than can ever be mentioned along these lines. Industry 4.0, like all preceding revolutions, will fundamentally alter the way we live and work. It will revolutionize the manufacturing and production industry by integrating the IoT (Internet of Things), information technology, cloud computing and other technological advances into the core of production and manufacturing systems. Machinery and physical systems will communicate and cooperate both with each other and with humans in real time via the web.

Industry 4.0 compared to industry 3.0

Fig.1: Industry 4.0 compared to industry 3.0

The impact of Industry 4.0 is likely to be greater and more comprehensive than some of us may imagine. By integrating artificial intelligence, information technology, advance robotics, smartphones and smart algorithms, companies will be able to track anything they produce and upgrade products in real time.

Moreover, companies will be able to learn mass-customization; the ability to make tailor-made products in batches of one to answer different customer specifications. Amid the technological advances and smart integration, customizing products will be as inexpensive to companies as mass-production. In the near future, the fourth industrial revolution will expand its capabilities to offer real answers to major issues such as global warming, aging populations, increasing air pollution and more.

During his election campaign Trump stated clearly that his economic plan focuses on creating new jobs by encouraging domestic production and hiring more Americans. In his plan, Trump overlooks the fact that the real downturn in job openings in the past few years has occurred due to virtualization of human jobs. In fact, according to the Center for Business and Economic Research at Ball State University, 4.75M jobs were lost between the years 2000 to 2010 due to technology.1 This problem needs to be addressed by creating a society that allows for more technological contribution, creates more necessary jobs and thus increases consumption and growth in the economy.

Trump's decisions during his first term as president will dictate the US's and the world's future in terms of economic growth, consumption, unemployment and technological competitiveness. There seems to be no way to avoid the fourth industrial revolution, but there are indeed many ways to make the best out of it.

For the US to lead this game, Trump should enable a supporting technologic net, such as a large accelerator for start-ups and companies that are looking to be pioneers in the forthcoming revolution. Some critics claim that Trump is low-tech and will not keep up with the technological change; optimists believe he will surround himself with advisors who are much more knowledgeable to help move forward. Either way, Trump holds a responsibility perhaps greater than any other president in the US history – the future is in Trump's hands.

 1 https://www.ft.com/content/dec677c0-b7e6-11e6-ba85-95d1533d9a62

Eli Pelleg

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