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The Fourth (4th) Industrial Revolution

At Publicis Sapient we cover a variety of industry areas that include the public sector — they’re all being impacted by the Fourth (4th) Industrial Revolution, which should be no surprise when we look back in history. To get started with a view of the universe we cover, here’s a decoder ring to get started. To start off, the various industries (and subcomponents of each industry) are in various states of “gone digital.” We”ll get a bit nerdy by using the Kardashev scale model for civilizations in relation to the Internet. Then, that scale model will be used for the industries with links that point to where one can learn more.

Kardashev Scale Adapted

Type 1 or the “Planetary Civilization” can use and store all of the energy available on its planet. Let’s call this kind of organization one that’s mastered paper and the digital office to an extent that they are users of technology. They know how to search on the Internet and make it useful to their endeavors. They’re also masters of the physical universe because they’ve harnessed and lived it to the fullest.

Type II or the “Stellar Civilization” has made its way out onto the web as first-class citizen, and has figured out how to use it for basic owned digital marketing efforts and the ability to establish oneself as a digitally credible entity. They’ve figured out how to have a mobile app, or at least lean into the world of the mobile web as initial experiments in going digital. They’re blurring how their owned physical spaces can interact with technology in novel ways.

Type III or the “Galactic Civilization” has ventured fully into the entire universe of social media and they need to cover a giant surface area of contact with many consumers. They have access to proportionately numerous data points from which they can navigate with and prioritize their efforts to cultivate relationships with the latest in CRM technology. They’re also taking advantage of physical space and how it can impact data gathering in all aspects of their constituents’ lives.

Type IV or the “Universal Civilization” has made forays into AI and machine learning. They’ve managed to navigate autonomous technologies to achieve uncanny (not just desperate ones) acts of digital and have entered a space where they’re not entirely sure of the ethical implications of what they’ve created. The entire physical world is connected in a multi-point channels that impact everything a person is doing.

Type V or the “Multi-Universe Civilization” has made the techie “singularity” vision occur and the “oops” moment has happened for humanity where there’s no turning back. But perhaps something wonderful has happened instead of just the dystopia we’re told shall one day appear.


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The State Of Industries

Fidelity has a useful categorization of relative sizes of industries per its own methods. YC is a great resource for discovering how startups are disrupting industries right now.

Type I thru III: Traditionally Low in Experience Quotient

Financial Services: Estimated at over $26T by 2022 it is the largest sector and is about money making more money. It’s being disrupted by a variety of FinTech startups today because the incumbents’ ability to perform well in the digital experience space is low. The physical experience prowess of the Public Sector area is traditionally LOW; their digital experience is LOW as well.

Energy & Commodities: Looking globally the E&C arena is worth well over $10T. The physical experience prowess of the Energy & Commodities area is traditionally LOW; their digital experience is LOW as well.

Public Sector: Much of the “govtech” sector is Type 1 with a sizable market opportunity at an estimated value of over $400B for the US alone. The physical experience prowess of the Public Sector area is traditionally LOW; their digital experience is LOW as well.

Health: The arena of wellness is valued well over $5T globally. The physical experience prowess of the Health area is traditionally LOW; their digital experience is LOW as well.

But this industry tends to attract some wonderful, empathetic professionals who ground a kind of mission-driven service that we have a lot to be thankful for.

Type I thru III: Traditionally Moderate in Experience Quotient

Transportation & Mobility: The physical experience prowess of the Transportation & Mobility area is traditionally MEDIUM to HIGH (think of fancy cars); their digital experience is LOW but evolving quickly.

Telecommunications, Media & Technology: This space is valued well over $10T. The physical experience prowess of the Telecommunications, Media & Technology area is traditionally LOW; their digital experience is LOW as well, but their customer experience/support capability delivers at scale with HIGH efficiency.

The first Apple store opened in 2001 and presented a new global standard for how this space would transform. On the Media industry front, the non-physical experience dimension to an experience as introduced by Netflix revolutionized that universe.

Consumer Products: In the US the estimated size of the CP industry is $630B. The physical experience prowess of the Consumer Products area has generally depended upon the Retail sector so it’s been LOW, but now with pop-ups and D2C (Direct To Consumer) as becoming more of a way forward, the physical experience capability has been needing to go HIGH; their digital experience is LOW but pressured to be HIGH as well.

This sector has defined itself through product quality and defining its worth through product packaging. But it’s relied on the Retail space for the experience; it’s also relied on advertising as a way to “sell” the product quality.

Type I thru III: Traditionally High in Experience Quotient

Retail: The retail industry is estimated in the US as a close to $4T industry currently Type 1 thru III, and if you’re Amazon you’re Type IV. It’s positively impacted by three factors: high consumer confidence, low unemployment, and rising wages. The physical experience prowess of the Retail industry is traditionally HIGH; their digital experience is LOW but growing.

The Retail sector is one of the most savvy physical experience makers in the world.

Travel & Hospitality: Overall this industry is well worth into the multi-trillions. The business travel piece is expected to grow to $1.6T. The physical experience prowess of the Travel & Hospitality area is traditionally HIGH (think Cornell Hotel School of Management); their digital experience is LOW. And most importantly, this industry area is talent bound.

Type IV is all the Tech Companies

Tech companies know how to speak machine. It’s a built-in advantage that more people need to understand to thrive during the 4th Industrial Revolution.

When we survey different groups about Type IV companies, the following are starting to appear in our informal polls (this list is constantly being updated):

  • Financial Services: Ant Financial
  • Energy & Commodities: TBD
  • Public Sector: TBD
  • Health: TBD
  • Transportation & Mobility: Uber, Tesla
  • Telecommunications, Media, & Technology: Verizon
  • Consumer Products: Apple
  • Retail: Amazon, Shopify
  • Travel & Hospitality: Airbnb, Google

Appendix

Education market is estimated at $6T.

Smart Money Map (copy of the original by Martin Wattenberg)