Opening of the Academic Year & New Campus Saxion University of Applied Sciences in Enschede Wednesday 2 nd September

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1 Opening of the Academic Year & New Campus Saxion University of Applied Sciences in Enschede Wednesday 2 nd September Good morning everyone. It is a great honour to be invited to the opening of the new academic year at Saxion University, in this wonderful campus. It is a particular pleasure to be here, given my personal connections with Enschede Everyone in this area is proud of the reputation Saxion has built as one of the country s most prestigious institutions of higher education, attracting students from all over the world. Also an institution with a rich history, dating back to Interestingly, that is just the time that Jurgens and van den Bergh were establishing their margarine businesses in Oss, which would later become Margarine Unie and then, of course, part of Unilever. 1

2 So we share in many ways a common period of history. We also share an unrelenting commitment to science and technology. And I have to say it is a great honour and not a little daunting to be here in front of some of this country s top current and future talent in the field of applied science. I could simply not run my business without the power of the science, technology and innovation - key drivers of our growth. That s why we invest over 1 billion a year in Research and Development. Employ 6,000 scientists many of them PhDs across six global research laboratories, including Vlaardingen here in the Netherlands, one of our principal Foods research laboratories. This is an exciting time to be in academics or joining the work environment. 2

3 There are many fascinating challenges awaiting us. The most intense and impactful will be mastering the new technology revolution, or, I should say, the forthcoming transformation of humankind. What many have predicted is becoming a reality. We are at the start of a technology revolution unlike anything before. The history of human progress has always been driven by great inventions - from fire to fuel cells, from papyrus to the printing press. But it is rare for innovations to have an impact much beyond their intended use; rarer still for the impact to be so revolutionary as to transform entire economies and societies, yet alone human nature itself. For millennia, technology-driven growth of population and income at a global scale has been relatively slow. As one central economist put it recently: If the history of growth were a 24-hour clock, 99% would have come in the last 20 seconds. Today, we are at the threshold of a new Industrial Revolution, the speed and breadth of which we have yet to fully grasp. 3

4 Just consider the unlimited possibilities of billions of people connected by mobile devices - as is the case today - that have so much processing power, storage and access to knowledge. Moreover, the coming together of emerging technology breakthroughs is staggering, covering everything from artificial intelligence, robotics, the internet of things, autonomous vehicles, 3D printing, nanotechnology, biotechnology, materials science, energy storage, quantum computing, and so on. Many of these innovations are only a few decades old but they are already reaching an inflection point in their development as they build on, and amplify, each other. At the same time, we are also witnessing profound shifts in many industries, marked by the emergence of new business models, the disruption of incumbents and the reshaping of production, consumption, transportation and delivery systems. 4

5 On the societal front, technology is driving paradigm shifts in how we work and communicate with each other, as well as how we inform ourselves. Governments and institutions are also being reshaped, as are systems of education, healthcare and transportation, to name a few. While we don t know how the transformations driven by this Industrial Revolution will unfold, it is clear that all stakeholders - governments, business, academia, and civil society - have a responsibility to work together to better understand the emerging trends. This is critical in shaping our collective future to reflect common objectives and values. We need a comprehensive and globally shared view of how technology is changing our lives and that of future generations, reshaping the economic, social and cultural contexts in which we live. The changes are so profound that, from the perspective of human history, there has never been a time of greater promise, and also of potential peril. 5

6 The tragedy is that many decision-makers are either too caught in traditional, linear (and non-disruptive) thinking, or too absorbed by the current crisis, that there is no time left to strategically shape our future. Today, I believe we are in the midst of a Fourth Industrial Revolution. The first Industrial Revolution (late 18th century) ushered in mechanical production, led by the invention of the steam engine, cotton spinning and railroads. The second Industrial Revolution (late 19th and beginning of 20th century) made mass production possible, led by the invention of electricity and the assembly line. The third Industrial Revolution (starting in the 1960s) is usually called the computer or digital revolution and was catalyzed by the invention of semiconductors, mainframe computing (1960s), personal computing (1970s and 80s) and the Internet (1990s). 6

7 We are now in the midst of the Fourth Industrial Revolution. It started at the beginning of this century and builds on the digital revolution. It is characterized by a much more pervasive and mobile internet, by smaller, cheaper and more powerful sensors, and artificial intelligence and machine learning. The Fourth Industrial Revolution is not only about smart and connected machines and systems it goes far wider. There are a wave of outstanding breakthroughs in areas from gene sequencing to nanotechnology, from renewables to quantum computing, and many others. These are exciting times. The scale and speed of this Revolution differs completely from the past. Both the first two revolutions needed 100 years for their full effects to be felt through the economy. One can argue the Second Industrial Revolution is still unfolding in developing countries, as nearly 1.3 billion still do not have access to electricity. The same applies to the third Industrial Revolution, as 4 billion people, mostly in the developing world, still lack Internet access. 7

8 The revolution now unfolding is fundamentally different. It involves an entire systems revolution and not just a product-specific one. In the past, a technical innovation typically resulted in the creation of a new product, which then became the basis of a whole family of related products and services. Take the invention of the automobile as an example it gave rise to a whole new industries, from motorways to gas stations. The forthcoming revolution will completely transform our current system of production, distribution and consumption of goods and services. This systems-centred innovation will create ways to deliver value in new ecosystems. Take health care. By any measure, global health has improved dramatically in recent decades. But the current model is being slowly torn apart by the pressures of an ageing population and greater restraints on government spending. Maintaining the status quo is not an option. The healthcare system of the future will look very different. One crucial change will be the move to consumer-centric healthcare, allowing people to have much more 8

9 responsibility for managing their healthcare. Care will get moved closer to home and from high-cost, specialized labour to self-care. There will be similar transformation models for every industry, and also for social delivery systems, such as education and public services. With global disruptive shifts, and with 3D printing reshaping traditional supply chains, there will also be a fast evolution from mass production to customized production. Goods will increasingly be produced by smaller, more flexible workforces who are closer to the customer, or by individual customers themselves. This systems transformation is happening at both the production and consumption side. Over recent years, we have seen the rise of a new sharing economy, with people using the internet and mobile technologies to access goods, services, skills and resources provided by their peers rather than a traditional corporate supplier. 9

10 This sharing economy completely disrupts the traditional rental sector. Just think of Airbnb (which now has 22% more guests per night than Hilton Worldwide) and Uber becoming the global market leaders in the hospitality and car rental sectors. The Fourth Industrial Revolution therefore has many implications: Industries will be disrupted as the sharing economy and asset optimization spread. Those who survive will need to maintain - and continually sharpen - their innovative edge. Small and medium-sized companies could thrive as speed and agility in disruption and innovation will be greater. Economic growth will equally be effected as we see the effects of disintermediation, robotization and the sharing economy coming through. Future needs can and will be fulfilled using less material input and labour 10

11 Employment will also be more challenging. We will see a system-wide transformation ranging from job creation to job displacement, and from greater labour productivity to widening skills gaps. The impact on societies will depend on how the benefits of new technologies are distributed. In the best case, it may result in greater freedom for individuals in a world of abundance and reduced hierarchies. In the worst case, it may lead to the replacement of human capital for automated supply chains. On the other hand, the revolutions within biotechnology will allow us to redefine what it means to be human by pushing the current threshold of lifespan, health, cognition and general capabilities. Given this, moral and ethical boundaries will have to be redefined or there is a risk they could be manipulated to serve special interests, but not necessarily the public s interests. In short, the Fourth Industrial Revolution is not only changing what we do but also who we are. 11

12 We are at the dawn of human transformation unlike anything before. We need new ways to shape our future in this fastchanging, more interconnected and more complex context. Our current compartmentalized approach needs to be replaced by collaborative, flexible structures that reflect the integration of ecosystems and the multistakeholder relevance of the challenges we face. Take self-driving cars. Who will regulate? Automobile or internet-related industry associations, governments, insurance companies, city planners, governments, fast moving corporations? And who will do it at the global level? Overall though I am optimistic. Just look at the progress humankind has made in the last fifty years in creating, in many parts of the world, higher degrees of personal freedom, eradicating poverty, prolonging life and opening up new ways for self-development. 12

13 The Fourth Industrial Revolution has the potential to address - and possibly solve many of the issues that the world is struggling with. Just one example: we have the means we need to create a sustainable economy. Just think of the fast shift from fossil fuel energy to renewables, with an energy system that universally connects renewable production, embedded into virtually all buildings and vehicles, and enhanced by technology breakthroughs in energy storage. This new technology age, if shaped in a responsive and responsible way, could catalyse a new Cultural Renaissance, enabling us to feel part of something larger than ourselves - a true global civilization. It also has the potential to lift humanity into a new collective and moral consciousness based on a shared sense of destiny. Your generation as the leaders of tomorrow have the chance to shape this future. And on that exciting note, I am delighted to open the new academic year of the Saxion University. 13

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