Industry 4.0 embraces ‘profits with purpose’

ESI ThoughtLab CEO Lou Celi on the potential—and risks—of digital transformation

Industry 4.0 must focus on ecosystems and partnerships to extend greater prosperity to everyone.

Corporate investments in digital transformation promise exciting improvements in workplaces and in our cities, but they demand greater collaboration among all stakeholders to achieve their potential, said Lou Celi, founder and chief executive of the consulting firm ESI ThoughtLab, during ServiceNow’s digital conference, Knowledge 2021.

“This is the next industrial revolution,” Celi said. “The world is moving into a more inclusive form of capitalism, and I think that’s going to be a force of good for the world.”

Previous industrial revolutions emphasized increasing the output of goods through mass production to make societies richer. Now, as the world faces extreme environmental and social challenges, the digital industrial revolution—what some call Industry 4.0—needs to focus on “ecosystems and partnerships,” Celi said. Business, government, cities, universities, and citizens will need to work together to address these threats while extending greater prosperity to everyone.

“We’re going to be moving from ‘greed is good’ to ‘profits with purpose,’” Celi said.

Pandemic fast track

The COVID-19 pandemic has accelerated the transition, Celi said, causing social disruptions that placed new demands on digital tools and technologies. Suddenly, office workers were doing their jobs remotely and consumers moved most of their shopping online. Cities too experienced dramatic changes—fewer people commuted to work and many no longer saw a need to live in expensive, crowded urban areas.

[Read also: Industry 4.0 relies on human talent]

Some of these changes will persist long after the pandemic ends, Celi predicted. Work will become a hybrid of at-home and in-office. In industries where in-person collaboration is most critical, workers will return to the office. Others will continue to work remotely for much of the week. “The future of work we were talking about is now,” he said.

Managing new risks of Industry 4.0

The changes also highlight what Celi described as one of the biggest downsides of Industry 4.0: an escalation in the number and severity of cybersecurity breaches, such as the Colonial Pipeline ransomware hack and a similar cyberattack against beef processor JBS. Cybercrime is already a $1 trillion drag on the global economy, according to a report published by McAfee. “It’s a big business,” said Celi.

The dangers are especially acute for cities, which lack both the critical personnel and the ability to protect themselves against cybercrime. Cities must invest heavily in “people, process, and technology,” Celi said, with a special focus on training users and hiring chief information security officers.

The future of work we were talking about is now.

Workers and citizens also need to learn how to secure their data against hackers and the phishing exploits that leave IT systems vulnerable to attack. “The smart companies and cities I know are trying to think about training, upskilling, and awareness programs,” Celi added.

Still, organizations can’t protect themselves completely, and must be prepared to deal with attacks when they occur. “The key is resilience, fast response, and recovery,” said Celi. “Assume that you can’t be 100% secure in this world.”

Digitally divided

Celi pointed to another downside of technology evolution: the growing divide between the digital haves and have-nots. During the pandemic, “you had kids from poorer families that did not have access to computers who actually couldn’t learn as well as others,” he said.

Cities have an important role in addressing the problem. “Philadelphia is doing some nice work,” Celi said, pointing to a pandemic-inspired initiative in Philadelphia to ensure that every school child has access to a computer.

New partnerships, not increased competition, will be key to tackling these challenges. For cities and businesses, that means involving all citizens, especially those in underserved populations, in decision-making. “You have got to build trust in government, trust in technology and trust in business,” said Celi.