'The Fourth Industrial Revolution’ and its consequences was the subject of the annual ‘Davos-meeting’ which took place in January 2016. Present were 2500 of the world’s most influential people (CEO’s, Scientists, Politicians, NGO-leaders etc.) to exchange views and possible actions about ongoing transformations in the global economy and new requirements for Leadership. From the many presentations and discussions I give a short summary with consequences for Businesses, Governments and ‘We, the People’, then I will focus on the need to change our Educational Systems.

The Fourth Industrial Revolution
We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, this transformation will be unlike anything humankind has experienced before. The response to it must involve all stakeholders of the global polity, from the public and private sectors to academia and civil society.

The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.

This fourth revolution will affect all of us
The speed of current breakthroughs has no historical precedent. Compared with previous industrial revolutions, the Fourth is evolving at an exponential pace. It is disrupting almost every industry in every country. And the breadth and depth of these changes transform entire systems of production, management and governance. We cannot foresee today which scenario is likely to emerge, however, in the future, talent, more than capital, will be the critical factor of production.

The Fourth Industrial Revolution has four main effects on business:
on customer expectations
on product enhancement
on collaborative innovation
on organizational forms

Customers are increasingly at the centre of the economy, it is all about improving how customers are served. A world of customer experiences, data-based services, and asset performance through analytics require new forms of collaboration, particularly given the speed at which innovation and disruption are taking place. The emergence of global platforms and other new business models mean that talent, culture, and organizational forms need to be rethought and forces companies to re-examine the way they do business.

Disruption in industry
The nature of the change will depend very much on the industry itself. Global media and entertainment for example, already saw a great deal of change in the past five years. The financial services and investment sector, however, has to be radically transformed. Those working in sales and manufacturing will need new skills, such as technological literacy. Some advances are ahead of others. Mobile internet and cloud technology are already impacting the way we work. Artificial intelligence, 3D printing and advanced materials are still in their early stages of use, but the pace of change will be fast.

The impact on government
The ability of government systems and public authorities to adapt will determine their survival.
If they prove capable of embracing a world of disruptive change, subjecting their structures to the levels of transparency and efficiency that will enable to maintain their competitive edge, they endure. A Government that cannot evolve will face increasing trouble.

Current systems of public policy and decision-making evolved alongside the Second Industrial Revolution. Decision-makers had time to study a specific issue and develop the necessary response. The whole process was designed to be linear and mechanistic, following a strict “top down” approach.

This approach of politics is no longer feasible!
Given the Fourth Industrial Revolution’s rapid pace of change and broad impacts, legislators and regulators are challenged to an unprecedented degree and for the most part prove unable to cope.
How can they preserve the interest of the consumers and the public at large while continuing to support innovation and technological development? Only by embracing ‘agile’ governance, similar as the private sector increasingly adopted agile responses to software development and business operations.
This means regulators must continuously adapt to a new, fast-changing environment, reinventing themselves so they can truly understand what it is they are regulating. To do so, governments and regulatory agencies will need to collaborate closely with business and civil society, with all stakeholders.

The impact on people
The Fourth Industrial Revolution will change not only what we do but also who we are.

It will affect our identity and all the issues associated with it: our sense of privacy, our notions of ownership, our consumption patterns, the time we devote to work and leisure, and how we develop our careers, cultivate our skills, meet people, and nurture relationships.

It is already changing our health and leading to a ‘quantified’ self, and sooner than we think it may lead to human augmentation. The list is endless because it is bound only by our imagination.

Shaping the future
Neither technology nor the disruption that comes with it is an exogenous force over which humans have no control. All of us are responsible for guiding its evolution, in the decisions we make on a daily basis as citizens, consumers, and investors. We should thus grasp the opportunity and power we have to shape the Fourth Industrial Revolution and direct it toward a future that reflects our common objectives and values.

To do this, we must develop a comprehensive and globally shared view of how technology is affecting our lives and reshaping our economic, social, cultural, and human environments. There has never been a time of greater promise, or one of greater potential peril.

Today’s decision-makers, however, are too often trapped in traditional, linear thinking, or too absorbed by the multiple crises demanding their attention, to think strategically about the forces of disruption and innovation shaping our future.

In the end, it all comes down to people and values. We need to shape a future that works for all of us by putting people first and empowering them. In its most pessimistic, dehumanized form, the Fourth Industrial Revolution may indeed have the potential to “robotize” humanity and to deprive us of our heart and soul.

But, as a complement to the best parts of human nature - creativity, empathy and stewardship - it can also lift humanity into a new collective and moral consciousness based on a shared sense of destiny.

What skills will change most?
Creativity will become one of the top three skills workers will need. With the avalanche of new products, new technologies and new ways of working, workers have to become more creative in order to benefit from these changes. Robots may help us get to where we want to be faster, but they cannot be as creative as humans (yet). Negotiation and flexibility are high on the list of skills for 2015, in 2020 they will drop from the top 10 as machines, using masses of data, begin to make decisions for us. Emotional intelligence, which is not in the top 10 today, becomes one of the top skills needed by all.

Change won’t wait for us: Business leaders, educators and governments, all need to be proactive in up-skilling and retraining people so everyone can benefit from the Fourth Industrial Revolution.

The impact on our Education Systems
McGowan (2016) states clearly that ‘Education implies there is a path toward a definitive, finished state wherein an individual became packed with knowledge, thus “educated”.

However, in a world of accelerated change, with rapid disruption cycles in industry and with rising automation, that end state of being “educated” is just no longer meaningful. An individual must have ‘learning agility’, the ability to learn, adapt, and apply in quick cycles’.

Rising Automation
Until today individuals are educated and trained for expertise and knowledge, then they are employed to use this knowledge to do their work for decades. However, our reality today is that rising machine intelligence can render anything that can be codified both digitized and automated. This rapid proliferation of global connectivity and dissemination of content reduces the value of each individual’s stock of knowledge, it reduces the ability of a worker to monetize a single dose of education over a career lifespan and, it leaves the concept of a profession in question. For instance:
65% of the students in school today will work in jobs that do not currently exist
47% of today’s jobs will be automated in the next two decades
In 2020, more than 50% of the content in a graduate degree will be useless in 5 years.

From learning the Tool, to learning from the Tool
As human species, we have moved from using hand tools to assist us with labour tasks, to interact with tools that entirely replace labour. As we entered the information age we shifted from assisting labour to assisting cognitive tasks. We are now on the crest of massive human technological displacement from current jobs, at a time when an algorithm can achieve anything mentally routine or predictable.

In one significant manifestation of this disruption, educational efforts once focused on training students for mastery of a tool - a software program or an app - to use throughout their education and career. Tools are now built as adaptive learning platforms - designed to understand the learner’s progress and a threshold of competence to advance them with just the right degree of friction and frustration to generate learning. This is a massive shift from learning to master the tool, to both learning from the tool and collaborating with the tool, as shown in this figure:

Why Does This Matter? A Rapid Shift of Norms
In the next decade we will see a huge number of tectonic shifts. Signs of exponential technological expansion and adoption will materialize around us.
As Mark Bonchek, says: "Ours is the first generation in history with a need to update our mental maps within a single generation. The old models are rapidly becoming obsolete. This creates a challenge of not only learning, but rather unlearning. For example, this may be the last generation that needs to learn how to drive a car."

All these tectonic shifts are smashing our contextual references and notions of a single linear dose of education and the straightforward status of being “educated” both insufficient to fuel a multi-decade career. The future of work is learning agility and cooperating within a deep interface between humans and machines.

The key to economic growth lies in the skills and talent of its people, its human capital.
There are two major pressure points in the chain of education, skills and human capital.

Job growth and technological change
In many countries there has been a drop in unemployment numbers since the global financial crisis but there is evidence that this is not so much due to jobs growth as that the long-term unemployed are giving up on trying to find a job.

Technology is changing industries at a rapid pace and the labour market is therefore entering a period of uncertainty. Managing this transition is an important challenge, as is preparing for the future beyond an expected increase in automation.

Skills gap and skills churn
The types of skills that employers need are changing all the time. Employees are under pressure to continually learn and adapt to evolving and emerging industries.

As technology further reshapes business needs, both individuals and countries will have to address ongoing skills gaps.

• Traditional education is badly equipped to develop dynamic skills in students. Most schools and universities are teaching a 20th-century education to young people who need cutting-edge 21^st century skills. This is an issue that calls for long-term commitment to reform from successive generations of all political leaders.

What needs to change in Education?
Advances in technology and the Fourth Industrial Revolution mean the need for systemic change in education and training. The changes can be broken down into three key areas.

1) Connecting education and employment

Employers need to collaborate with schools and universities on the development of curricula and a shared practical knowledge of the market. The education system also needs to change to allow a focus on lifelong learning.

2) Improving forecasts
Better forecasting of industry and labour-market trends is vital to allow governments, businesses and individuals to react quickly to change. Big data is likely to prove pivotal in developing more accurate predictions of where the jobs market is moving and where the skills shortages are expected to lay.

3) Disrupting education and labour policy
While there has been impressive progress in improving access to education, the quality and relevance of learning has rarely been improved on any scale. Government’s policy has lagged behind when it comes to skilling the national workforce. Education and labour policy need to be re-examined to make them more proactive and relevant to the ever-changing market realities.

Example Educational Reform in the Netherlands
23 January 2016 a project group presented its Report that answers the assignment: ‘What knowledge and which skills do students need in 2032 to be able to fully participate in the future society?’
2032 is chosen as date of reference because a starter at a primary school today will finish his/her education then.

The project group, with all stakeholders involved, proposes a core-curriculum and that schools/universities have the freedom to add whatever they think is necessary for broadening and deepen within this core framework.
Proposed is a.o. to let go of the rigid structure of year classes and schedules. Within the core curriculum ‘Freedom’ is the keyword:
freedom for schools to profile themselves and differentiate from other schools
freedom for teachers to experiment with different teaching methods
freedom for students to follow their own interests and strong points

Finally, schools will receive a budget; politics will be put at distance from content.
The core-curriculum consists out of three, so called ‘interdisciplinary domains’: Human and Society, Nature and Technology, Language and Culture.

The Dutch Minister of Education approves with the Report. Questions like: ‘How to transform the System as fast as possible?’, ‘How to implement?’ etc. will be further discussed with all stakeholders.

Example Educational Reform in Croatia
Mr. Boris Jokič received a similar assignment from the previous Minister of Education of Croatia.
He followed a similar approach by involving many stakeholders. The response of the new Minister of Education unfortunately was to make some changes. From the news(papers) I learn this might be about content, historical and religious adjustments.

We have to wait till the Minister comes up with a concrete response; however, I am afraid.

Although Mr. Orešković stated that one of the ‘Five generators of transformation’ of the new Government is the reform of the Education system, the question is if this will be put into practice?

What I see is the big need to transform Croatia’s Education System at many points to provide students with the necessary skills to become successful in their future and for the future of Croatia.

Just one example: Croatia ranks only 36 out of 60 countries in PISA 2015.

Will the Minister of Education think deeply about the ‘Fourth Industrial Revolution’ and its consequences, especially for Croatian society? Will he be able to let the professionals do their jobs, without interference based on political hobbyhorses?

Will politicians be able to ‘jump over their own shadow’ and look at the future needs of Education and Development? Will politicians be able to cooperate broadly to prevent Croatia for creating another lost generation? Croatia certainly has the expertise, potential and opportunities, but, will it be used?

Anyway, not to reinvent the same wheel again, it could be helpful for Croatia to do some benchmarking with e.g. Finland and the Netherlands, who are developing in a similar future direction.

John Lodder MA., MSc.
www.balance-consultancy.com