Boardroom Report (BR): What is the fourth industrial revolution?

Robert Wickham (RW): The fourth industrial revolution is something that we give a lot of thought to at Salesforce and our CEO Marc Benioff has spoken extensively about the topic at the World Economic Forum (WEF). It is a term that has been coined by Klaus Schwab, the CEO of the WEF, and to us, it comes down to two megatrends that are colliding to introduce a level of complexity in the marketplace that we have never seen before.

One is the acceleration of technology where everything is essentially becoming more connected and smarter with the rise of artificial intelligence and machine learning. The other, which is something that is not talked about as much as we believe it should be, is the backlash to globalisation where we are seeing a pushback on the social fabric that has been the foundation of post-WWII prosperity.

BR: How should directors be thinking about the fourth industrial revolution?

RW: We think that leaders, whether they are boards or CEOs, need to fundamentally focus on four things as they phase into the fourth industrial revolution. The first is how you build and maintain trust in this complex environment. Today, we are in a situation where there is a crisis of trust. With the technologies that underpin the fourth industrial revolution, there is an opportunity to have so much access to information and you can’t validate the facts that are there which has led to a crisis of trust at the government, corporate and citizen levels.

The second is growth, how do you drive growth in these uncertain times? The levers that you traditionally would have pulled have changed, particularly in Australia where we are going from 30 years of unprecedented growth which has been driven by responding to demand in the marketplace to a new normal where you have to figure out how to stimulate that demand.

The third, which is coupled with growth, is innovation and how you continue to innovate which is no longer optional but imperative in the modern era.

The fourth, which I feel very passionate about, is equality. The fourth industrial revolution and the technological developments that underpin it have the ability to either decrease or widen the income gap and we think leaders have an intentional role to play to ensure that they are the stewards of that in an appropriate way.

BR: You’ve spoken about how successful start-ups merge hipsters, hackers and hustlers. What do you mean by that trichotomy and is it possible for established organisations to apply that in the way that star-ups do?

RW: That is just a fun construct to highlight the skills and personas needed for a business to be successful. The hipster is the cool, creative type who brings creativity and energy to the business and real design thinking that is focused on keeping the customer at the centre of their decision-making. The hacker is the person that has the ability to create and build things quickly and the hustler is the person who does everything else and keeps things moving forward.

If you want to simplify that further, it’s a mashup between design-led thinking which involves keeping the customer core to your mission and all of your decisions, as well as agile methodology which involves testing and putting things into the market and learning from the results, even when they’re not successful and use that as a way to iterate or pivot. Any company, regardless of their size, can embrace that methodology, especially in the disruptive and turbulent world that we live in called the fourth industrial revolution.

BR: Does policy have a role to play in innovation in Australia and what would you like to see the government do to support that?

RW: I look at the government innovation statement and I think it has been a really strong start. If you look at the statement, it is going after four pillars to help set the conditions for the innovation ecosystem within Australia. The ecosystem has two parts in this case, the soil and the weather. What constitutes the soil is the responsibility of the government to try and get right and the weather is the other parts such as the venture capitalist and other people involved in the process help to develop that ecosystem.

In terms of getting the soil right, developing skills and talent is vitally important and I think the government is doing some work to address that, whether it be through visas or in creating the incentives to attract the world’s best talents to Australia as a destination. But at the same time, we have to do more to help educate the next generation of technology leaders that are now in primary and high school. They’ve done work to make venture capital attractive to people in Australia and we’ve seen really good acceleration of funds coming into venture over the last two years as a result which is a good thing. Other things that should be done include more funding for the local ecosystem initiatives. I think the government has made a good start but there is plenty more that they can do.