Daniel S. Smith

The Fifth Industrial Revolution by Pranjal Sharma


Review of The Next New: Navigating the Fifth Industrial Revolution Pranjal Sharma, Harper Business Press, July 30, 2023

The fourth industrial revolution is history. Never mind that many small and medium size enterprises (SMEs) are stuck at industry 3.2. Indian writer & technologist Pranjal Sharma breaks from the orthodoxy, arguing that we are already embarking upon a brighter future.

The fifth industrial revolution (5IR) promises to be more than just a numerical progression from the fourth. Imagine a world where humans work alongside AI-powered robots, enhancing workplace processes. This new phase of industrialization, also known as Industry 5.0, emphasizes a human-centric approach, increased resilience, and a strong focus on sustainability. Yet it is unlikely we will see a massive change in the structure of society.

Sharma uses a simple formula:

(ESG + Fourth industrial revolution) x SDGs = 5IR

He argues: “The fifth improves upon the fourth. It is more caring. The additional objectives are sustainability, governance and social impact.” Sharma cites the Chinese proverb ‘May you live in interesting times’ to emphasize that the rate of change we are experiencing today is unique. The equation to thrive is:

Megatrends + Industry = Disruptions = Opportunities

In 2016, economist & engineer Klaus Schwab wrote the book The Fourth Industrial Revolution. The first industrial revolution occurred in factories in the second half of the 18th century and into the 1800s. The second industrial revolution was embodied by Henry Ford’s assembly line in the early 20th century. The third industrial revolution was the digital or computer revolution, which many readers lived through in the second half of the twentieth century. 

According to the law of accelerating returns, coined by Ray Kurzweil who has a new book coming out June 25, technological change is exponential. What used to take a century now happens in months. Industry 6, 7 & 8.0 may come and go before we realize it. Contrarians of many stripes could argue we are already onto the sixth industrial revolution, or still stuck in the second, ad infinitum.

Sharma, the former Bloomberg TV host, is a pragmatic optimist. He is a practitioner in many of the fields he writes about. He writes: ‘Smart manufacturing is toggling between Industry 4.0 and industry 5.0.”

Human nature is a factor which Sharma fails to decipher. The Internet of Things (IoT) will connect everything and everyone. Will those who benefit from all of the data share their proceeds with the masses? Or, as Hebrew University of Jerusalem historian Yuval Noah Harari writes: “Equality is out. Immortality is in.” Will the beneficiaries of the 5IR work to make a better society, or not, focusing on upgrading themselves to super humans and teleporting to space while the planet burns? 

The New Delhi resident wrote India Automated: How the Fourth Industrial Revolution is Changing India, arguing: “Recognition of the rise of automation in India will be the first big step towards embracing it, preparing and planning for it.” In 2018, he wrote his first book Kranti Nation: India in the Fourth Industrial Revolution. Prof. Schwab quipped: “We may interpret kranti as revolution, as Pranjal Sharma does, but in Sanskrit, the word also means course/trajectory, including that of the sun. Is India on that technology trajectory?” 

Sharma is a regular participant at Davos. Current World Economic Forum (WEF) president and former Norwegian foreign minister, Borge Brende, endorsed The Next New:

 “The Next New is a required-and compelling-reading for anyone looking to understand how the intersection of technological, societal and economic forces is ushering in a new era of opportunity not just for prosperity but for the well-being of our communities and planet.”

Borge Brende. Courtesy the Barrents Observer

Author Parag Khanna writes: “Is the WEF’s role as a convener itself a form of agency? Does the WEF only mirror the “global agenda” or does it shape it?” The WEF is split into ten pillars. The pillar that focuses on the benefits of remote work is the Center for the New Economy Society.

Yet the WEF, with over 800 employees and a little under half a billion dollars in yearly revenue, does not offer a single remote job. In their 2020 bestseller COVID-19: The Great Reset, Schwab & Thierry Malleret, a French economist whose recent book “Deaths at Davos” I reviewed in my last column, argued for the continuity of remote working beyond the pandemic:

Likewise, we may decide that working from home (when possible) is good for both the environment and our individual well-being (commuting is a “destroyer” of well-being – the longer it is, the more detrimental it becomes to our physical and mental health.

Since public-private partnerships will become more important in the 5IR, equity should be baked into all innovations. Dr. Schwab wrote his pioneering work on the stakeholder model while he was between Harvard & Geneva & Germany for school & work. Placing the corporation as an organism within a broader ecosystem, Modern Enterprise Management in Mechanical Engineering, is not available online. 

Schwab was a four-handicap golfer at the time, yet he described his position a la Milton Friedman’s more prominent “shareholder capitalism” as David versus Goliath. Reading author & Salesforce CEO Marc Benioff, one may think that the stakeholder model has emerged triumphant. On September 13, 1970, Friedman published “The social responsibility of business is to increase its profits,” in the New York Times. As inequality continues to skyrocket, he may have been right.

A correction is in order. Rebecca Henderson urges Reimagining Capitalism in a World on Fire. Thierry & Mary Anne Malleret write in Ten Good Reasons to Go For A Walk that a wealthy Monthly Barometer client confided: “That to save capitalism is going to require a substantial dose of socialism.”

Robert Brenner, an economic historian at UCLA, argued capitalism began when feudalism ended: “capitalist social-property relations – i.e. only where the economic actors have been both freed from any structure of ruling class surplus extraction by extra-economic compulsion and separated from direct, non-market access to their full means of subsistence (though not necessarily production).” There was little stopping these “animal spirits” in ensuing centuries. 

Yet Sharma claims the 5IR will be more inclusive. As I noted in a past column, the fourth industrial revolution had some negative externalities. A vibrant civil society & government have been there from time to time to catch many who fall through the cracks. We can do more than hope for a fairer and kinder form of capitalism. Sharma quotes Dr. Schwab: “stakeholder capitalism is a form of capitalism in which companies do not only optimize short-term profits for shareholders, but seek long term value creation, by taking into account the needs of all their stakeholders, and society at large.” 

Chapters include: “Automotive for the People,” “Firing Up Green Digital Energy,” and “Weapons of Mass Disruption.” In The Great Reset, during COVID-19, the authors aim for: “accelerating rather than delaying progress towards the 2030 Sustainable Development Goals.”

Sharma argues the three key pillars of the 5IR are:

  • Technological breakthroughs: Rise of AI, material science, new fuels, among others.
  • Values, ethics, safety and social equity: Increased governance with focus on social inclusion
  • Climate change goals and accountability: tech will be expected to serve the objective of sustainability and accountability of actions

He does not reference much history. Nor does he analyze civil society’s role. Sharma is focused on the technological change as opposed to larger societal impacts. He tells us what he knows best. 

The author touts Digital Travel Credentials, which are gaining traction around the world. Mobile driver’s license continue to pick up. The National Institute for Standards and Technology (NIST) proposed digital ID for public food benefits. Could this go the dystopian route?  Sharma writes: “It increasingly appears that success and failure are a game of chance and not skill anymore.”

Sharma references the WEF’s Global Lighthouse Network, which is composed of smart-factories around the world. In India at the time the book was written, there were two Lighthouse Network sites: Hindustan Unilever Limited (HUL) near Mumbai and Schneider Electric’s smart factory in Hyderabad. Parag Khanna notes that: “Keohane and Nye (2003) provided an early sketch of a five-part typology of potential global governance architectures: (1) a state-centric model (2) an intergovernmental organization model (3) a transnational private actors model (4) a global governance networks model (5) a world state model. Hagram (2006: 98-101) incorporates this typology into his own framework containing six distinct “normative-analytic images” of world order, all of which he notes are “competing for institutional dominance and even ideological hegemony”: (1) inter-state multilateralism (2) grassroots globalism (3) multiple regionalisms (4) world statism (5) networked governance (6) and institutional heterarchy.” 

Global Lighthouse Network. Courtesy World Economic Forum

Sharma does not look at potential externalities. Swedish philosopher Nick Bostrom, who recently moved on from his post as head of the now defunct Oxford Future of Humanity Institute, published Deep Utopia which I reviewed, and is enjoying his freedom, notes one risk: is that the universal proletariat would not even be conscious.” Schwab & a multi stakeholder collaboration of scholars write in Shaping the Future of the Fourth Industrial Revolution: ”There is currently growing concern that the fight against this pandemic and future ones will lead to the creation of permanent surveillance societies.” Perhaps a treatise on risk in the fifth industrial revolution is worth a study of its own. 

Something crazy is going on here. How do we contain it and reap the cornucopian benefits therein? How do we govern an organism more capable than ourselves? Parag Khanna writes: “Global governance is commonly defined as the process of cooperation among transnational actors aimed at providing responses to global problems.” Sharma writes in the Daily Guardian: “Can we govern the ungovernable? Should we even try to contain the advance of algorithms?”

Sharma’s ‘The Next New’ challenges readers to reconsider the trajectory of technological progress and its effects on society, making it a thought-provoking read for anyone interested in the future of industry and beyond.

About the Author
Dan is a historian and human rights advocate
Related Topics
Related Posts