The fourth industrial revolution: Is the water sector digital-ready?

23 Apr 2021

Guest blog by Martin Shouler, Arup

How digital disruption is set to impact the water sector

As mentioned in one of our most recent blogs, digital disruptions hold great potential for innovation in the water sector. We’ve seen in other sectors that new scalable, customer-centric, digitally networked business models, like those of Amazon, Google, Uber and Airbnb are not only ‘game changers’ for customers, but are also affecting service, growth, scale and revenue potential for companies in every industry.

The advent of the fourth industrial revolution clearly indicates that even if this seismic shift may seem a distant concern to some industries, the trend is not unique to digital start-ups and tech-superstars: it will affect every sector.

The first industrial revolution was steam-powered; the second electrical; the third signalled the birth of the age of computing.

The fourth industrial revolution is the era in which we witness a fusion of technologies coming together – for example the Internet of Things, 3D printing, genetic editing, machine learning, robotics, mobile supercomputing and much more.

Although previous industrial revolutions liberated humankind from animal power, made mass production possible and brought digital capabilities to billions of people, this fourth industrial revolution is fundamentally different and is blurring the lines between the physical, digital, and biological spheres.

The promise of disruption

Like every other, the water sector is not immune from the changes that are transforming communications, technology, manufacturing, the workplace and society. Digital disruption can be considered like any other driver of change: when it acts upon a sector, there are opportunities for those ready to accept the challenge.

The ‘Digital Tide’ Initiative, which Arup worked on with the Economic and Social Research Council (ESRC) and the UK research consortium Twenty65, explored how digital technologies and processes have the potential to impact the water sector.

The research found that each of the 40 ‘digital disruptors’ identified fall into one of the following categories:

  • Sensing: Improved sensor technology, and the potential for more distributed and diverse data sources, will change the way we measure and evaluate both quantitative observations and qualitative experiences.
  • Connectivity: The connection of a vast number of sensors, objects and people into a common network presents an opportunity to exchange insights and instruction, and enable new services and interactions.
  • Data: Technical advances in data storage and processing power promise to have a transformative effect on the speed, resolution and richness of a variety of systems.
  • Automation: Advanced digital intelligence and mechanical dexterity are coming together to create new possibilities for improved efficiency and decision-making.
  • Networks: Digital networks provide an opportunity for data to be exchanged for mutual benefit, shared vision, and as part of business models to produce better profiles of risk, reward and customisation.

Each of these digital disruptors holds great promise if applied to the right challenges in the right way, with the potential to revolutionise much of our everyday business as usual in years to come.

And no business or sector can afford to be left behind. A report by McKinsey & Company in 2020 highlighted that the COVID-19 crisis has brought about years of change in the way companies in all sectors and regions do business.

Is the water sector digital-ready?

It is clear that although the speed of digital change is rapid and all persuasive, the response by the water sector will be diverse due to the regional differing states of maturity and their ability to take-up opportunities.

The water sector has a considerable amount of inherent inertia built in, due to its capital-intensive infrastructure. However, there are opportunities for those willing and able to exploit the digital advantages of the fourth industrial revolution to deliver better, cheaper and a more resilient water future.

And that’s a revolution that everyone should get behind.

Arup, along with Nesta Challenges and Isle Utilities, is supporting the delivery of the Ofwat Innovation Fund. The £200 million Innovation Fund aims to grow the water sector’s capacity to innovate, enabling it to better meet the evolving needs of customers, society and the environment. You can find out details about the Innovation in Water Challenge and the Water Breakthrough Challenge on their dedicated pages.

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