System Changes for a Better Implementation of Industry Revolution

Industry Revolution 4.0 is often seen as a panacea for our economic well-being. Of course, there is some truth that an economy must continue to improve and adopt the latest technology. But, it would be a big mistake and a total misconception if policymakers think that the mere adoption of the latest technology could magically resolve all economic challenges a country faces.  

Technology is just an enabler. Like all other factors that enable and accelerate economic growth, it is only one of the many strings of enablers that must work in unison to achieve a meaningful outcome. Fundamental economic factors include readily available assets, access to funds, and a good supply of quality talents necessary to supplement the provision of technology to generate growth. 

It is not true, as when we talked about IR4.0, we are adopting technology for the first time. We have been integrating technology for the longest time. We have adopted machines to replace animal power, electrifying many of our industries and streamlining manufacturing processes, and even adopted computers and information technology with our MSC initiatives. Adopting IR4.0 is just another progression in our effort to progress with time.

The real question is, are we progressing enough? In reality, many of the 1.4 million enterprises running our economy are still in IR3.0 or even lower. This only shows that while we are keen to adopt technology, the ability to transform our industry to be fully engaged in, at best, very dismal. What will it be then our likelihood to succeed in genuinely adopting IR4.0? Again, it is about looking at the situation holistically. Do our enterprises have the capacity to acquire assets, provided with sufficient funds, so that they can do what we wish them to become? 

Government ministries and agencies play a vital role. We need the right people to provide good leadership for this to happen. Good policies connecting supply and demand ensure our efforts to adopt IR4.0 are sustainable. Our economy is dominated by GLCs that procure many products. Can we have clear guidelines that their demand for products and services is tied to locally developed goods to justify these enterprises' investments? Our current reality does not reflect this. We are happy to be good global citizens of a free open economy. We need to emphasise the spirit of nationalist interest first.

Talent development can be implemented only when local enterprises see the real benefit of investing and adopting IR4.0. Sadly, we have invested many resources in developing talent, but they are released into the economic ecosystem independently. There is a lack of coordination between talent generation and industrial development. This is a failure in policies and coordination efforts. This will only get worst when IR4.0 requires not only new discipline but also the retraining of existing resources. 

The inability to tackle all these will become more severe in a globalised economy. Regional economic cooperation such as RCEP, CPTPP and more will give rise to more competition from enterprises from neighbouring nations that can coordinate their effort more systematically than others. Digitalisation will create a two-way trade flow much more aggressively than ever before. While we are a trading nation now, our regional economic partners will rise to compete. With a small population and higher cost, we have little choice but to move towards higher-value goods and services. Time is of the essence, and we need to move faster.

We badly needed good leadership at all levels. Our southern neighbours have been very successful because of their policy of meritocracy, pragmatism and being brutally honest in assessing their situation to survive in the economic competition. We can learn a great deal from this, but we need political stability for this. The future is a connected world. We must learn to decentralise and empower more people. Developing future leaders that have the nation's interest above individual's greed is crucial. Current leaders must learn to let go and be bigger than the problem. The years of experience could be used in coaching and instituting good governance.

With good leaders guiding strategic policies and governance, we can only implement technology adoption IR4.0, talent development, or others. These efforts are not a one-off event but rather a journey. The ability to do continuous incremental growth is a necessity. We don't need much brouhaha or rhetoric but actual work everyone supports.

It's a system problem. The government with the right policies, universities generating promising talents, industries that are connected correctly in the supply-demand ecosystem, everyone needed to be well aligned in a long-term agenda that is all about national development. Only when we can get our act together, however busy we are, doing IR4.0 in an isolated manner will not move the needle much. 

Much discussion on Industry 4.0 has centred on technology and the work that can be done with advanced robots working alongside people.

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About the Author

    

Ir. Dr Mohd Shahreen Madros has over 30 years of working experience in various capacities. He was a lecturer in Universiti Kebangsaan Malaysia (UKM), with over 20 years of experience in the Oil & Gas industry. He was also the appointed CEO of MATRADE from early 2017 until Feb 2019 during which he represented Malaysia in many international trade missions. Dr Shahreen is currently an independent advisor to industries, a board member of a public listed company, a certified coach, and an Adjunct Professor at the Graduate School of Business, UKM.