the 4th industrial revolution -...

2017 GW October Conference

The 4th Industrial Revolution & SME Policy Innovation

October 26, 2017

Young-Sup Joo, Ph.D.Distinguished Professor, Korea University

Former SME Minister, SMBA of Korea

Young-Sup Joo, Ph.D. - October 2017

Megatrends of Global Economy

q “4th Industrial Revolution” & “New Normal Era”as Two Keywords of the Global Economy

LowGrowth

LowInterest Rate

Low Inflation

High Unemployment


The 4th IR & New Normal Era will be a big threat

for our Future Jobs.

Is it true?What is our countermeasure?


PhysicalWorld(Real)

Cyber World

(Digital)

Bio World

(Human)

The 4th Industrial Revolution (Davos 2016)• Industrial Revolution driven by Convergence

of Digital Devices, Human and Physical Environment- Tech Innovation : IOT, Big Data, AI, AR/VR, Robot, Bio, etc.

• “Convergence of Physical-Cyber-Bio Worlds”

* Broad Perspective

4th Industrial Revolution - Definition


“Industrie 4.0” as 4th Industrial Revolution

(Source : DFKI)

Industrie 4.0

* Narrow Perspective


Core Technologies for 4th Industrial Revolution

IOT

Big Data

AI

CyberSecurity

5G CPS HMIUI/UX

Cyber Based Technology

Robotics

AR/VRMR

Physical Based Technology

SmartSensor

3DPrinting

EnergySystem

Platform Technology

CloudComputing


Evolution of Manufacturing Paradigm

(Source : Prof. Darek Ceglarek, WMG)


Evolution of Manufacturing Paradigm

(Source : Prof. Darek Ceglarek, WMG)

Industrie 2.0

Industrie 3.0

Industrie 4.0


4th Industrial Revolution - Impacts

Physical + Cyber + Bio Convergence

Ø Mass Production &Mass Consumption

Ø Customized Production & Customized Consumption

è In the new era, a small but fast fish eats a big but slow fish.

Ø Products Decide Demand

Ø Led by Large-sized Enterprises

Ø Led by Innovative Start-ups & SMEs

Ø Demand Creates Products

4th Industrial Revolution

Ø Scale matters Ø Speed and Flexibilitymatters

è The era of Innovative Start-ups and SMEs is coming!


New Normal Era - Impacts

High GrowthLow Unemployment

Low GrowthHigh Unemployment

Global Growth RateSliding Down

Job CreationAs Top Priority

Increasing Sentiment of Trade Protectionism

4.12

WORLDOECD

2.663.55

2.203.75

2.61 2.560.94

8.3 7.5

10.0 11.3 11.5

4.65.8 9.6 8.1

6.2USA

EU

Global Financial Crisis

ü In the low growth era, the economic pie is getting stagnant→ Job has emerged as the top priority issue globally

ü Job ‘Zero-Sum’ : The world is in a war to create jobs


q Most of Jobs are created by SMEs/Startups : over 95% recently

q SMEs as a Main Driver of Export, Economic Growth, and Employment

-21.2

SMEs LSEs

91.3121.2

79.898.1

20.21.98.7

’11 ’12 ’13 ’14

(2016)


For 4th IR and New Normal Era,

SMEs and Start-ups

is the Key to Success!


q Intensively Nurture Innovative Start-ups & SMEs§ Technology Innovation to secure Global Competitiveness§ Human-centered (“Humane”) Entrepreneurship

4th IR and SME Policy Innovation - Summary

q Execute Human-Centered Business Model Innovation as well as Technology Innovation§ BM based on Customized/Personalized Products & Services

q Expedite Manufacturing Innovation§ Manufacturing Innovation 3.0/4.0


q Intensively Nurture Innovative Start-ups & SMEs

ü Implement a Master Plan to Secure Global Competitivenessfor Start-ups & SMEs § Primarily, Secure Technology Competitiveness

by Strengthening R&D for Continuous Tech Innovation- 4th IR, Convergence & Integration, Smart & Green Innovation- Open Innovation : Global R&D Collaboration

§ Secure Speed & Flexibility Competitiveness- Need Management/System/Culture/HR Innovation

4th IR and SME Policy Innovation (1)

ü Nurture & Disseminate Human-centered Entrepreneurship§ Innovate Corporate Culture & Increase Investment in HR


For the Success of

SMEs and Start-ups,

Humane Entrepreneurship

is the Key!


UN MSME Day & Humane Entrepreneurship

q ICSB-UN SME Ministerial Meeting (June 16, 2016 @ UN Hq.)

ð UN has declared June 27 every year as UN MSME Day


The 4th Industrial Revolutiondoes not only require

Technology Innovation,but also Human-centered

Business Model Innovation



q Execute Business Model Innovation - 1ü Pursue Customized Products & Services Based BM

§ Mass Production ð Mass & Individual Customization§ Differentiate Customization by Business Size and Type, etc.

Pro

duct

Volu

me

High

Low

Product VarietyLow High

Cost CompetitiveMass Production

Mass Customization

Regionalization

Niche Markets Full/Semi-IndividualCustomization

Strategy MixUpgrade &

Differentiation


q Execute Business Model Innovation - 2

ü Pursue Networking, Organizing, and Groupingof Start-ups & SMEs to secure Scale Merits

ü Pursue Alliance with Platform Enterprises§ Business Collaboration with Global Platform Companies

- Pursue M&A, Strategic Alliance, Entry into GVC, etc.

§ Korean Conglomerates : Need to cope with Global Trends

§ Execute Joint “X” - Marketing, Brand, R&D, Production, Purchasing, etc.

ü Pursue New Business Models § Product Servitization, O2O, Data-driven BM, etc.


1②창조경제및제4차산업혁명에의대응

Moving Picture


Proposal for Global Collaboration

R&D / HRD / BD

Ø Global Standardization of Existing and Newly DevelopedCore Technologies

Global Standardization

Ø Joint R&D of Core Technologyincluding AI, Big Data, IOT, CPSby Global Industry/Universities/Research Institutes

Ø Cooperation in HRD and Global Business Development

Propose Cooperation for Global Standardization andJoint R&D / HRD / BD among Global Leading Countries

to lead and disseminate 4th Industrial Revolution

Ø Jointly Lead Global Standardization Activities


It’s time for global countriesto enhance cooperation

including 4th IR programs to create new growth enginesand put the global economyback to a high growth track.


To this end, we must nurtureInnovative Start-ups and SMEsby promoting Human-centered

Corporate Culture based on Humane Entrepreneurship


Thank youfor your attention!

the 4th industrial revolution -...

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