The Great Reset and the Hyperconnected World in the Post COVID-19 Era

Dr. ASLI VAROL

 

It has turned out that current political systems, ways of doing business and social conditions are not conducive to build a healthier, more equal and more prosperous future. The COVID-19 pandemic has also shown that humanity is not ready to respond immediately to such a global crisis. However, the effects of the climate crisis and environmental degradation have caused economic and environmental challenges around the world. As a result of all these devastating effects, the foundations of a new initiative were laid to improve the condition of our planet.

Great Reset: “One path will take us to a better world”

The Great Reset that aims rebuild the world economy after the COVID-19 pandemic was introduced in May 2020 by Charles, Prince of Wales, and Klaus Schwab, Chairman of the World Economic Forum. Great Reset aims to overcome the challenges of the COVID-19 pandemic by creating opportunities. If these opportunities are used well, a greener, more equal and more sustainable world will be created. At the virtual Davos Summit in January 2021, the concept of the Great Reset focused on how economies will recover after the COVID-19 outbreak and how to rebuild lost confidence and optimism.

As stated in the book titled “COVID-19: The Great Reset”, “We are now at a crossroads. One path will take us to a better world: more inclusive, more equitable and more respectful of Mother Nature” (Schwab and Malleret, 2020: 190).  That’s why Klaus Schwab, Chairman of the World Economic Forum, proposes to the “Great Reset” of capitalism for a healthier, more equitable and prosperous world economy in post-COVID-19 era. Thus, it is aimed to be more sustainable and resilient against the worsening conditions with global crises such as COVID-19 and climate change. If the economic crisis caused by COVID-19 is not intervened in a timely manner, worse consequences will occur and the world will become more fragile than it is today. Schwab emphasizes that preventing this negative scenario can be achieved by promoting stakeholder capitalism, building a flexible, equitable and sustainable system based on “environmental, social and governance” (ESG) criteria, and utilizing the innovations brought by the Fourth Industrial Revolution.

There is no optimistic picture of a return to normal after the COVID-19 outbreak. Schwab and Malleret state that some pundits talk about the period “before coronavirus” and “after coronavirus”. This warns about the arrival of radical changes (Schwab and Malleret, 2020: 11-12). The private sector has important duties in ensuring the adaptation to these radical changes. The private sector should take the lead in cultivating a sense of sustainability in societies in order to protect the resources of our planet and to overcome the new crises that may arise with the least damage.

Companies could lay the foundations for a better future with sustainable business practices within the framework of the Paris Agreement and the Sustainable Development Goals. Companies have the power to gather the whole world around common goals to turn the effects of COVID-19 into opportunities. Building a better economic system and healthier societies can only occur when companies achieve stakeholder capitalism. While the COVID-19 pandemic was experiencing its toughest period, companies actively worked in vaccine development and distribution, ventilator production and all processes in the fight against the pandemic. Therefore, companies that have been so effective in overcoming the COVID-19 crisis will continue to be the most important stakeholders in the construction of the post-COVID-19 era.

Hyperconnectivity and Fourth Industrial Revolution                                                             

The macro reset will occur in the context of the three dominant secular forces that shape our world today: interdependence, velocity, and complexity. These three forces will affect everyone, more or less, wherever they are in the world (Schwab and Malleret, 2020: 19). It is necessary to act quickly and jointly to build a sustainable economic and social system through the Great Reset.

The tremendous progress of globalization and technological progress over the last few decades represents that the world is now “hyper-connected”. An interdependent world is a deeply systemic interconnected world where all risks affect each other through a complex web of interactions. Under these conditions, it is understood that an economic risk will not be limited to the economic field or that an environmental risk will have reflections on risks of different nature such as economic, geopolitical, etc. (Schwab and Malleret, 2020: 19-20). To overcome these risks, it is necessary to build a new economic and social system that is flexible, sustainable and inclusive. In this new system, the business world should make maximum use of the opportunities offered by the Fourth Industrial Revolution. 

Schwab states that the fourth industrial revolution has four main effects on business across industries (Schwab, 2016: 54):

o        “customer expectations are shifting

o          products are being enhanced by data, which improves asset productivity

o     new partnerships are being formed as companies learn the importance of new forms of      collaboration, and

o         operating models are being transformed into new digital models.”

The business world could transform the ways of doing business by considering these four effects. Large companies are the leading stakeholders in the construction of a sustainable common future. In this sense, the business world has a great responsibility. Companies must work with all other stakeholders to improve the health and well-being of our planet. 

Business Leaders Must Take Action

With its speed and breadth, the Fourth Industrial Revolution has connected billions of people with mobile devices, bringing the unlimited possibilities of providing unprecedented processing power, storage capabilities and knowledge access. Emerging technology breakthroughs that cover wide-ranging fields such as artificial intelligence (AI), robotics, internet of things (IoT), autonomous vehicles, 3D printing, nanotechnology, biotechnology, materials science, energy storage and quantum computing are opening the doors of a new era (Schwab, 2016).

Companies and business leaders will lead the process of adapting societies to this stunning digital revolution. It is certain that business leaders will have a great impact on directing the society. Companies will be the main drivers of an inclusive and sustainable global economic system that targeted through the Great Reset.

References 

Schwab, Klaus (2016): The Fourth Industrial Revolution, World Economic Forum, Cologny/Ceneva.

Schwab, Klaus, Thierry Malleret (2020): COVID-19: The Great Reset, World Economic Forum, Forum Publishing, Geneva.