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Five Books Every Industry 4.0 CEO Should Read

By Pavan Muzumdar | Automation Alley | 12/6/2017
 

If you’re even somewhat active on social media, it’s common to see advice that starts with “The Six things” or “The Eight Whatevers.” And while these titles may sound tired and so last year, I can say this with certainty: If you haven’t read these five books, and you are a leader dealing with rapid technological change, you won’t waste your time reading them.

First some background.

Over the past year, as Automation Alley has staked its claim as Michigan’s knowledge center for Industry 4.0, we have been doing a lot of research on what leaders need to do to prepare for the changes brought forth by rapid technological change. And as it turns out, the preparedness has more to do with managing human dynamics and looking at business differently than the actual technologies themselves.

At its core, Industry 4.0 is the convergence of physical and digital technologies. This is disrupting not only how we consume products and services, but also how we make them and how we do work. The challenges executives face with this relentless change and uncertainty are not trivial. As a business leader dealing with these issues myself, I know how it feels to not know.

While there’s never a limit to how much one can learn, the five books I have listed here hit upon the central themes of culture, finance and technology that we have uncovered are essential to managing Industry 4.0 change. And even though they won’t tell you what to expect, I suspect they will prepare you to handle it.

1. “The Five Dysfunctions of a Team: A Leadership Fable” – by Patrick Lencioni

What it’s about: Using the story of a company facing a leadership crisis, Lencioni demonstrates how trust and accountability go hand-in-hand in any team.

Why I chose it: The disruption and change caused by Industry 4.0 can put a strain on any team. The only way to manage that change is for a company to be a learning organization and be able to iterate through its strategies and tactics. For this to be true, the leadership team must be completely aligned on purpose, vision and values. That alignment leads to trust and accountability, which are the bedrock of the culture necessary to be a learning organization. Lencioni shows us how to recognize harmful team dynamics and what we need to do to address them.

2. “The 80/20 Principle: The Secret to Achieving More with Less” – by Richard Koch

What it’s about: Richard Koch shows with compelling evidence that very often 80 percent of our successes are the result of only 20 percent of our efforts. Meaning, 80 percent of our efforts may not be delivering effective results at all. With this knowledge, we can be much more effective in identifying and reducing wasteful activities to be much more effective.

Why I chose it: Industry 4.0 does not come with a prescribed strategy or tactics for success. The companies that succeed often reveal a serendipitous combination of luck and preparedness. In some cases, the preparedness is accidental, while some companies are proactive. To be part of the latter group, executives need time for reflective thinking and learning. The reality is that most executives in companies today are overbooked and overworked. The principles of this book show how we can mitigate this reality and create more whitespace on our calendars.

3. “The Black Swan: The Impact of the Highly Improbable” – by Nassim Nicholas Taleb

What it’s about: Published in 2007, and looking at it retrospectively, “The Black Swan” has the rare distinction of being a perfect user’s manual for finance professionals to prepare them for the 2008 financial crisis. Too bad only a few regarded it that way. Nassim Taleb shows us the effect of non-linear and exponential complexity in systems and the uncertainty in financial analysis.

Why I chose it: Industry 4.0 challenges traditional financial analysis by introducing some of the same non-linear and exponential complexities that Taleb describes. Finance professionals need to understand the role of uncertainty and suitably augment their processes, tools and financial metrics to become a resilient company.

4. “The Mythical Man-Month: Essays on Software Engineering” –  by Frederick P. Brooks Jr.

What it’s about: In this book, Frederick Brooks shows us how smart and creative people come together to build products of lasting value. Though the focus of this book is on building software, it is a treatise on the creative process in any arena.

Why I chose it: The foundation of Industry 4.0 is the integration of physical and digital systems. While the physical side of the world is about manufacturing, consistency and repeatability, the digital side deals with implementation, variability and iterations. Companies that are in traditional manufacturing need to know how to deal with the dynamics of digital implementation which is quite different from those of physical creation. With this book, Brooks has offered an excellent primer for leaders to understand the creative process in the digital world.

5. “Business Adventures: Twelve Classic Tales from the World of Wall Street” – by John Brooks

What it’s about: John Brooks was a contributor for New Yorker magazine specializing in financial reporting. As such, he had a front-row seat in the world of business and finance. This book is what it says, twelve stories about companies at a specific point in their history and the drama and events that unfolded.

Why I chose it: Sometimes nothing illustrates a point better than a story. This book is a collection of fascinating tales that help us learn from the successes and mistakes of others. Each is about a leader or team finding themselves in unfamiliar waters and the decisions that they made as they tried to navigate them.

Learning isn’t a finite activity and these books are just a snapshot of the many that have helped me shape my worldview. I hope you find them as enlightening as I have on my journey of learning.

Pavan Muzumdar is the Chief Operating Officer of Automation Alley. His book Venture Perfect: The Leadership System to Maximize Teamwork and Profit in Your Business is now available. The book outlines icube™, a system that encapsulates many the principles of the books in this blog post, and offers leaders advice to ensure the long-term prosperity and sustainability of their companies. To reserve your copy, click here.

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