The Neolithic revolution ushered in the agrarian era wherein Mankind for the first time got together in Social clusters and produced items of necessity for the cluster. Over the millenniums, this small cluster grew and transformed into Cities and behemoth Metropolitan areas that were well served by the eras of Industrialization 1, 2 and 3 (Digitization). As the fourth Industrialization hovers, just below the point of inflection on the present Digitization technology’s ‘S’ curve, looking at timelines of 2024 for full development of the 3-D printing and the support infrastructure – Augmented and Virtual Reality, two speed IT and Autonomous of things – one can only imagine the possibilities and how our world would transform. The Leaders of tomorrow would have to deal with a smaller, tighter, more agile PODA (predict – Orient – Decide – Act) loop due to the accelerated velocity of disruption brought about by the diffusion of the physical, virtual and bio worlds.
Taking a small portion – Supply Chain and e-commerce – of Industrialization 4.0 (due to the constraints of the length of Article) the question that excites our curiosity is whether the incumbents of Industrialization 3.0 in the e- commerce, are even aware and prepared for this cataclysmic change. There seems to be a race for investing in the technologies to cater to the last mile, when the ‘last mile delivery’ won’t exist in Industrialization 4.0 or would reduce or transform to 10-12% of today’s volumes. The production would be either in-house or clustered in ‘less than a mile’ zones, depending on the scale or the complexity of product. Therefore, the segmented markets would be matched by the segmented and grid based production Zones to eliminate ‘Muda’ (waste) in time, resources and inefficiencies of supply chain. The incumbents are already past the P of the PODA and should be looking into the Orient phase, wherein an internal strategic audit of how the organization would pivot on the business economic model, Product re- orientation and not in the least, the supply chain.
The organizations would realize that assets of today – fulfilment centers, storage areas and the back-end supply chain professionals – would either shrink by 70-80% or no longer be required. The storage would be only for the large low volume products that would still need the complex infrastructure, groceries and any other products that won’t be produced by 3-D. If we take a walk through the process and as we see the design catalogue of a product in Virtual Reality or are prompted by the ‘evolved e- commerce incumbent company’, of our needs and requirements that even we aren’t aware of (an example would be the prompt by AI that I need to purchase chains for my car by combining prediction of snow over weather channels and feedback of lack of chains from the Data Base of my Home), we order these chains from the Virtual Reality directory and the printer prints my chains in the next 1-2 hours.
So, where do the e- commerce giants exist in the value chain of tomorrow? What happens to the workforce – do they re-train or the more ‘Artsy’ re-training (as I would explain later) is not possible and does all this end up in widening the economic chasms of the society? The value for these giants in the value chain would shift to the owning of patents (Research & Development costs would be included in the patent costs), solutions for monetization of these patents in a segmented customer base with segmented production venues and probably some off shoots would specialize in the 3-D materials supply. Thus, the companies would own and invest in Research and design and prepare the 3-D interphased (on a secure software platform), Digitized design templates of the new product. When the customer pays for the part of the patent costs, the template would be released to the printer and the product would materialize. The customer can also have his printer on the grid on a time-sharing basis wherein it may be part of the production of a series or of ‘one of the parts’ of a complex module, thereby enabling the customer to earn credits. For the more complex or scaled productions based on the predictive needs of a cluster or surrounding clusters the more specialized printers in the common production areas may be placed at convenient geo locations.
The workforce in future in these incumbents would concentrate towards ‘Artsy’ Dreamers in the imagination Labs, Designers, Engineers (or would they be replaced by AI, to produce precise mathematical lattices of the dreams and art of the imagination Labs) and Lawyers (aka patent producers). What the e- commerce companies would lose in terms of ‘market share’ to competitors (low entry barriers) and open sourced crowd sourcing in design (like LINUX), would be made up for the thinning of the cost of assets, eliminated costs of Muda (leaner), minimal costs of Supply Chain and the increased velocity of research to accelerate viable product quality and options. However, the costs of not orientating towards the writings on Horizon would be heavy and fatal. Would Industrialization 4.0 lead to a Flatter world, a more economically divided society or a highly sustainable process oriented eco-friendly earth is yet to unfold but surely, we would reach where we started it all – clustered zones with fragmentation of markets and production means in 3-D solutions.