The most significant transformations in Leadership with the advent of Industry 4.0
We are currently experiencing a significant transformation in production and business models across the entire industry
Industry 4.0 is also referred to as the Fourth Industrial Revolution. This phenomenon is based on the concepts of digitization and the interconnection of various components throughout the value chain via the Internet. The adoption of these new models will be inevitable, but the level of adoption will always be conditioned by the maturity and readiness for digitization within companies themselves.
Industry 4.0 is centered on the introduction of digital technologies such as the Internet of Things (IoT), Artificial Intelligence (AI), Big Data, Cloud Computing, and process automation. The use of these technologies can empower the industry at various levels, with examples including:
- IoT – The ability to equip devices that previously did not generate any data and, with the addition of sensors and Internet connectivity, now provide data from analysis of their environment.
- Artificial Intelligence (AI) – Allows for the processing of Big Data to make decisions with a higher degree of confidence and lower error, while simultaneously predicting the future with reduced uncertainty.
- Big Data – The ability to store large amounts of data at low cost, which is essential for AI operations.
- Cloud Computing – Remote access to stored information through the Internet.
The new Smart Factories benefit from IoT capabilities, robotics, and AI implementation to improve performance, scale predictive maintenance, optimize production, and reduce downtime, all leading to enhanced quality, cost control, and optimization.
The reindustrialization phenomenon happening in Europe is promoting near-shoring, attracting industries that were previously relocated due to high labor costs and low digitalization.
Industry 4.0 is also closely linked to optimizing Supply Chains, allowing for greater transparency and connectivity throughout the entire chain, from raw materials to the final product delivery. Significant advances have been made in inventory optimization, demand forecasting using AI models, improving logistics routes, and facilitating relationships between all value chain members, making Supply Chains more efficient.
With all these fundamental transformations taking place, it was expected that Human Capital would also undergo changes in leadership capabilities. There is a growing need for new skills related to digitalization, new competencies, and new ways of working. Above all, employees need to enhance their digital, data analysis, and problem-solving skills, with strong collaborative abilities increasingly being required. Upskilling and reskilling are essential for employees to adapt to the reality of Industry 4.0, making these highly sought-after skills today. Employees who demonstrate a willingness and ability to learn new technologies and integrate into constantly changing work environments will have a competitive advantage.
Alongside technical skills, soft and emotional skills play a crucial role in the era of Industry 4.0. Leadership, problem-solving, adaptability, and resilience, along with the ability to build trust within teams and handle daily ambiguities, are some of the most sought-after soft skills.
Among all these trends in candidate demand, I would like to highlight one of the most evident transformations—the verticalization of talent.
Verticalization of talent refers to specialization and deep expertise in a specific industry or sector, causing employees to focus on a particular knowledge vertical.
As expected, there are both advantages and disadvantages, but as this is a growing trend, I will offer some thoughts on the pros and cons. The advantages include the ability of an employee to become an expert, offering unique and tailored perspectives on a specific topic. With the specialization of businesses, there is also a tendency for experts in specific fields to command higher salary packages.
However, there are some downsides to verticalization, as specialization may limit the employee’s ability to choose opportunities outside their specific vertical.
Verticalization of talent can also reduce exposure to other approaches, so it is recommended that individuals strike a balance between deep knowledge in one area and adaptability, cultivating an interest in new areas and ideas.
Published in IT Insight, June 2024
Available here: https://www.itinsight.pt/news/opiniao/as-transformacoes-mais-marcantes-na-lideranca-com-a-chegada-da-industria-40
