After the release of Malaysia National Industry 4.0 Policy Framework, a lot of confusion about the term Industry 4.0 because of the document limit only to the Manufacturing sector. The Germans call it Industrie 4.0. The Americans call it Connected Enterprise, and the British call it the 4th Industrial Revolution. Don’t be surprised, the confusion will not stop there. You will hear a lot more about new terms such as:

• Technology 4.0
• Revolution 4.0
• Innovation 4.0
• Disruption 4.0

What’s exactly “Disruption 4.0”? To understand this, we need to understand the impact of First, Second and Third Industrial Revolution.

Disruption 1.0 – The impact of the whole industry when we introduce steam engine and horse-power. It disrupts the way companies manufacture products previously by just using man-power.

Disruption 2.0 – The impact when electricity is being introduced. It’s more environmentally friendly and production becomes mass.

Disruption 3.0 – Automation using IT database and Internet. We are seeing higher productivity and more efficient in managing logistics.

Disruption 4.0 – Here’s where we see multiple technologies (termed as Technology 4.0) such as Artificial Intelligence, Virtual Reality, 3D Printing, Blockchain, Internet of Things and much more combined which disrupts the way we conduct business. From product-based to service-based and finally to the outcome-based economy. We are also seeing many industries leverage each other to give better value to the end-user. Imagine when a taxi that used to be driverless can fly (very revolutionary transportation and termed as Revolution 4.0). Travelling will no longer be using our own cars but it’s just a method of requesting to reach a particular destination within a specified time (outcome-based and termed as Innovation 4.0).

The Year 2018 will be going an exciting year for Industry 4.0 or 4th Industrial Revolution when everyone wants to “Ride/Surf the Tsunami 4.0“. That’s really a Disruption 4.0. Get it?

(Note: If anyone wonders what on earth are,  they can define that starting from First Industry Revolution to Third Industry Revolution. Can you guess?)

• First Industrial Revolution – Technology 1.0, Revolution 1.0, Innovation 1.0
• Second Industrial Revolution – Technology 2.0, Revolution 2.0, Innovation 2.0
• Third Industrial Revolution – Technology 3.0, Revolution 3.0, Innovation 3.0

Malaysia’s Ministry of International Trade and Industry has published the National Industry 4.0 Policy Framework Draft and now open for public consultation (Duration: Feb. 12, 2018 – March 2, 2018).

I believed with the brains of various contributing organizations (government agencies, universities, Associations, Industry, etc), MITI has managed to collectively gather all the relevant and necessary inputs. Except that I noticed they did not consult Startups for whatever unknown reasons since I believed Startups have their own vision too. In fact, Startups looks at the world differently from the bigger conglomerates.

Also, take note that the Industry 4.0 Policy Framework only focused on the Manufacturing sector. Thus, the definition 4.0 takes into the progress and impact of manufacturing sector due to the advancement of technologies. Previously there’s an argument about the differences between the terms 4th Industrial Revolution and Industry 4.0. Personally, I felt limiting ourselves to the lower part of the value-chain (manufacturing), will also limit ourselves to transform our Nation into totally digital (digital lifestyle).

Framework is one thing, but the most important success factor after this will be the execution of the Framework by the respective parties (Government, Public, Private or Universities, etc)

Below are my personal public comments (will upload this comment to the MITI website later):

1. Talent Development – It’s difficult for a Nation to move forward without enough talent pool. We can depend on foreign expertise only when we don’t have enough talent locally. But have we done enough? How do expedite the process of approving new Courses or revamping old syllabus in the Universities?
2. Buy Local Attitude – We must ensure a balance between importing technology and using local technology. Local companies can’t immediately go global if they are not given a chance to prove locally. To encourage the growth of Startups that are key to becoming job creators, we must support them in providing the necessary trust and environment to proof their technology are also at par or better than the overseas.
3. Digital Transformation Mindset – If your company doesn’t have Internet, not many or none of the younger generation wants to work there simply because the current generation is tech savvy. It’s about time, the “older” generation take a bold step forward and become tech-savvy themselves. We didn’t realize that having an Internet access and IT database are actually prerequisites to Industry 3.0. Ask ourselves, are we already in Industry 3.0 before stepping towards 4.0? If yes, how big is the gap between rural and urban in this digital transformation?
4. Impact of Industry Integration to Policy Making – Remember UBER and how we react towards them? Remember motorcycle-sharing Dego and how we react towards them? Who will regulate a driverless taxi? What happens when a Taxi can fly? All of these disrupt the current business and need a new way of regulating them. We need to be fast. Thus, we must have trials as early as possible to see the impact of public usage and government regulations. In future, Insurance and Transportation or Insurance and Home or Health will be merged as an Outcome-based economy rather than the product-based economy. How flexible are we in handling this inevitable business merger?

Upcoming Talk at “One Day Seminar on ‘Smart Cities & Urban Science, Feb. 27, 2018, Wisma IEM, 01- Auditorium Tan Sri Prof. Chin Fung Kee, Third Floor, Petaling Jaya, Selangor”

IoT promises a big market but it has yet to grow exponentially. It’s not about technical challenges, but mainly it’s about having the right IoT business model. It’s not going to be any more about selling silo products based on its features. It’s no longer about subscription-based or pay-per used based. We will see the full strength of IoT when we can develop an Outcome-Based Business Model whereby we pay the services based on the outcomes such as an increase in new revenue streams, costs savings, customer loyalty, new creative products developed etc.