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Problems and Perspectives in Management, Volume 17, Issue 2, 2019
http://dx.doi.org/10.21511/ppm.17(2).2019.36
Abstract
Technological changes that come with industrial revolution have largely aected busi-
nesses, as well as society. With the current technological shi and Fourth Industrial
Revolution, many questions arise regarding the impacts and eects on current ways
businesses operate. is study presents a retrospective analysis and overview of previ-
ous industrial revolutions. e aim of the retrospective analysis is to identify common
characteristics that may lead to lessons learned for the forthcoming Fourth Industrial
Revolution and thus complement the current debate on technological change. All
previous industrial revolutions have led to change in business environments and new
challenges for managers and owners. e ndings show that all previous revolutions
have led to increase in the number of service jobs created. e key approach of success-
ful countries during the times of industrial revolution has included education as the
source of new skills and knowledge necessary for adaption. Countries that were able to
produce high skilled people could not only invent, but also adapt to new technologies
sooner than others. Similarly, these approaches included introduction of new manage-
rial practices in order to be able to utilize new technologies and new skilled workers ef-
fectively. e research article processes secondary data together with literature review
on this topic.
Lucia Kohnová (Slovak Republic), Nikola Salajová (Slovak Republic)
Industrial Revolutions
and their impact
on managerial practice:
Learning from the past
Received on: 25 of April, 2019
Accepted on: 20 of May, 2019
INTRODUCTION
Already in the 18th century, factories began to emerge, employing
many people. Before that, people mostly made products in homes
using hand tools or simple machines, not knowing the technologies
that would make it easier for them to work (Eden, 2018). e First
Industrial Revolution as the most important development in human
history has been shaping the world together with following revolu-
tions and technological changes (Stearns, 2012). Basic principles of in-
dustrial revolutions were tight to new inventions, technologies such
as machines and new production systems. However, the critical ques-
tion arising with new technologies during Second or ird Industrial
Revolution was how will the organization change and what will be
the impacts of such change. Similarly, to the times of previous revo-
lutions, these questions arise regarding the current, Forth Industrial
Revolution (Tortorella & Fettermann, 2017). While literature on this
topic is largely focused on technology adaptation, increase in produc-
tivity, eciency, supply chains or process design (Agostini & Filippini,
2019), we see a missing perspective on the possible links among indus-
trial revolutions and thus specic predictions of development regard-
ing organizational practice and management. is topic is important
due to the fact that each of the industrial revolutions has created new
© Lucia Kohnová,
Nikola Salajová, 2019
Lucia Kohnová, Ph.D., Faculty of
Management, Comenius University
in Bratislava, Slovak Republic.
Nikola Salajová, Ph.D. Student,
Faculty of Management, Comenius
University in Bratislava, Slovak
Republic.
industrial revolution, employment, skills, organizational
change, education, technologies, transformation
Keywords
JEL Classification O14, O32, N1
is is an Open Access article,
distributed under the terms of the
Creative Commons Attribution 4.0
International license, which permits
unrestricted re-use, distribution,
and reproduction in any medium,
provided the original work is properly
cited.
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BUSINESS PERSPECTIVES
Kohnová, L., Salajová, N. (2019) Industrial Revolutions and their impact on managerial practice: Learning from the past. Problems
and Perspectives in Management 17 (2) pp. 462- 478. http://dx.doi.org/10.21511/ppm.17(2).2019.36
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environments that owners and directors of companies had to handle. us, it is possible to see develop-
ment of management theory as the reaction on the problems of new systems in new environments (e.g.
(Fayol, 1916; Taylor, 1911). is paper aims to examine the specics of previous industrial revolutions
and identify common characteristics and developments. e paper complements the theory by identi-
fying links and common developments in the history of revolutions and thus complements the current
discussion on the forthcoming industrial revolution by introducing possible lessons, which may be the
focus of future research.
1. LITERATURE REVIEW
e First Industrial Revolution, dated from
the 18th to the 19th century, started in Britain.
Industrialization has been widespread especial-
ly in western countries, but has spread beyond
the West in the second phase of the revolution.
Industrialization meant a transition to powered,
special machines, factories and mass production.
e development of steam engine, iron and textile
industry also played a major role. e new ma-
chines were expensive and even owners of small
factories had to have the capital to continue op-
erating the company. ey accumulated capital
through partnerships (Papula & Papulova, 2014),
loans from banks or joint stock companies. With
the growth of production, investments had to
be made as well to sustain the growth (Mathias,
2001). Relatively small businesses prevailed in this
period. Small shops have replaced the traveling
peddlers. Industrialization has brought increased
volume and variety of products, improved living
standards. On the other hand, it has led to grim
working and living conditions for the poor and
working classes. Unskilled workers did not have
the job security and it was easy to replace them
with qualied workers. During the First Industrial
Revolution, the working hours were very long and
the workers did not have much free time (Stearns,
2012). First Industrial Revolution was further
characterized by regional diversities, which led to
dierences in expansion of industries in regions
together with dierences in wages (Deane, 2000).
e period of the Second Industrial Revolution is
dened by the years from 1870 to 1914 (Mokyr &
Strotz, 2000). It was characteristic for capital-in-
tensive production, productivity and living stand-
ards and formation of large corporate hierarchies
(Jensen, 1993). In particular, the major innovations
were aected by communication and transport,
which allowed goods to be transported from the
US to the Atlantic and vice versa (Chandler, 1990).
e transport revolution has opened up new mar-
kets for agriculture, industry, and banking. e
factories were not new to the Second Industrial
Revolution, but technology, material and manage-
ment in factories were innovated. Organizational
changes in the Second Industrial Revolution were
based on more expensive technology equipment,
the economy allowed businesses to increase pro-
duction, and technological change caused larg-
er businesses to employ thousands of workers. It
was a period of extremes, which led for a while to
overcapacity and partial recessions. Within this
period, markets were sustained by mergers and
acquisitions in 1890s, which allowed the marginal
facilities to be closed (Lamoreuax, 1985). In this
era, those who built societies lived in wealth, while
most of their employees earned pennies and lived
in poverty. ere has been an economic uncer-
tainty that has taken millions of people to work or
cut wages. Low-skilled workers in the industry did
not have safe working conditions, worked for long
hours at low wages, and had no pensions (Perkin,
1996). Production was increasingly carried out by
the machines themselves, with unskilled workers
pulling the lever or turning the valve. However,
skilled workers received high wages and oversaw
production processes. e economy in the Second
Industrial Revolution required technical skills
rather than workshop ownership.
Stearns (2012) considered the ird Industrial
Revolution (TIR) as the most dramatic, which
began to form in the 1960s. is revolution was
characteristic for technological innovation of elec-
tronics and IT for automation and production.
Communication accelerated, business contacts
moved to new levels. is revolution has created
thousands of businesses and millions of jobs, lay-
ing the foundation for globalization in the 21st
century. Businesses had to invest in new technolo-
gies to succeed in the labor market. e transition
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to the ird Industrial Revolution also required a
massive retraining of sta at a professional level.
e new workforce in new technologies has had
to be technology-qualied and hundreds of other
technical elds. Entrepreneurs and managers al-
so had to go through training to use new business
models, strategies to know the logistics and supply
chains. e skill level of a manager in a TIR was
qualitatively dierentiated from that of a manager
in a Second Industrial Revolution (Riin, 2012).
All industrial revolutions had some features in
common. Revolutions have seen massive tech-
nological and organizational changes, redening
the function of the family, changing the nature of
work and leisure (Stearns, 2012).
1.1. Organizational changes
between industrial revolutions
According to Kuznets (1973), major changes
through revolutions include shis away from agri-
culture, rst to industry, later to services. Within
these changes, the eects were in the scale of pro-
duction and inclusion of human capital. Quatraro
(2012) sees the change as a continuous ongoing
process, which may be dierentiated geographi-
cally or in dierent industries. Structural chang-
es as the outcome depend on the industrial times
in which we are. ey run around the world and
begin in more developed countries, and are initi-
ated by technology. First Industrial Revolution in-
troduced new machines that could be used mostly
only for large companies due to their high xed
costs and knowledge needed for operation. It cre-
ated the need for higher level of competence, which
led to the division of labor (Kapás, 2008). ese
changes led to the creation of organization of
work. Chandler (1977) states that with the contin-
uous inventions and growth of organizations from
1850 to 1920, organizations needed to be trans-
formed. Changes have been made on the basis of
technological advances in manufacturing, distri-
bution and strategy. Organizations have tried to
use this trend and adapt to innovation. e rst
managerial functions appeared in the railway and
telegraphic industries. Railways demanded mana-
gerial coordination and control for safety reasons,
especially to create faster steam locomotives.
During the twentieth century, the number of
white-collar workers increased. Qualied skills
of senior management (managers, professionals,
semi-professionals, technical workers), middle
and low management (administration, sales) were
required (Handel, 2012). In 1989, aer the fall of
Iron Curtain, a free market began to spread in
Eastern Europe. International trade has contrib-
uted to US employment growth through exports.
Total employment in this sector has increased
signicantly since 1993 (Occupational Outlook
Quartels, 2000). HR has also been transformed
over the years. Until the 1990s, HR was still unsta-
ble. is discipline was called Personnel and was
based on administration and policy camp. In the
1990s, it was already transforming into a HR sys-
tem. It was based on the PeopleSo platform that
removes work of employees from Personnel of ad-
ministrative work (such as manager changes, com-
pensation changes, and time o requests) through
more ecient technology-based processes (Cook,
2014). In the 1950s, the Human Resources
Information System (HRIS) was the rst time
introduced at General Electric (Bussler & Davis,
2002). HRIS means human resource management
through information technology. e system is
used to acquire, store, manipulate, analyze, re-
trieve, and distribute information about human
resources in organizations. e system was de-
signed to reduce HR routine transaction and au-
tomate them (Shiri, 2012). In 2014, the third wave
of the HRIS system was created. Organizations
have replaced cloud-based systems, leading to a
self-service HR technology environment that re-
quired little or no IT investment. A generation
of highly mobile employees has emerged and HR
workers have started recruiting through LinkedIn
and Facebook. Already in 1900, the idea of creat-
ing three educational skills – fostering aspiration,
developing reective conversation, and under-
standing complexity – was introduced. In the new
era of Big data, it is not enough for HR profession-
als to have only so skills. Support for HRIS sys-
tems is no longer sucient and experts lack skills
(Cook, 2014).
Aer all, all the revolutions were accompanied
by the transformation of the present state into a
new, better state. Each revolution has begun with
the impulse of technological development in one
of the countries (Fuchs, 1968). e technological
progress has created a need for change in organi-
zations (Papula & Volná, 2013) and the demands
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for workers have changed. e closer we get to
the present, the technologies are more challeng-
ing and complicated, and the need for skills per
worker increases. In large corporations, there has
been a demand for more information, better ad-
ministration, nancial, accounting, R&D, plan-
ning, strategy, marketing and HR (Handel, 2012;
Gažová, 2016).
2. METHODOLOGY
e aim of this article is to identify and summa-
rize key common characteristics of previous in-
dustrial revolutions based on analysis of second-
ary data and literature review. Literature review
describes in more detail the key characteristics of
industrial revolutions, how they arose, how tech-
nology was disseminated, what were the working
conditions of the employees, what professions pre-
vailed in the given periods. Secondary data from
employment, skills, education and technologies
are further elaborated and commented in the re-
sults and discussion. e literature and secondary
data have been summarized from various sources
and databases such Emerald, Springer, ProQuest,
ScienceDirect and statistical databases available
from European Union, OECD and World Bank.
Based on the research results, the article presents
important ndings regarding common charac-
teristics of industrial revolutions and its impacts
on organizational change that can serve as direc-
tion for further research, and may lead to lessons
learned that can be adopted by organizations in
their policies.
3. RESULTS AND DISCUSSION
Individual secondary data were divided into 4
categories:
• organizational change and employment;
• organizational change and skills;
• organizational change and education; and
• organizational change and technologies.
3.1. Organizational change
and employment
From the historical perspective, pre-industrial
economy was largely characterized by agricul-
Figure 1. Demand for occupaons in 1850–2010, US
Source: NPR (2015).
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ture as the main sector (Brenner, 1976). e typ-
ical pre-industrial worker had to be engaged in
many activities, occupations or even industries.
With the First Industrial Revolution, the worker
became specialized, focused on partial activity in
the whole process of conversion of raw material
into nal product (Deane, 2000).
In 1850, the share of agriculture in total employ-
ment was almost 60% (Lund et al., 2017). At the
beginning of the twentieth century, 10 million US
residents worked as farmers. By 2010, there were
only about 1 million farmers who produced food.
As we can see from Figure 1, technologies have re-
moved agricultural positions from the labor mar-
ket, but on the other hand, they have created jobs
in the services sector, blue-collar and white-col-
lar (blue-collar includes following positions: ma-
chine operators, manual labor, construction jobs,
white-collar includes following positions: profes-
sional and technical, managerial, sales, clerical
jobs, service includes following positions: food
service, health care, personal service jobs) (NPR,
2015; Desjardins, 2016). In the early twentieth
century, another major change followed – a shi
from production to service. Since 1919, employ-
ment in the services sector has been higher than
in the manufacturing sector. Employment in busi-
ness services also increased as employment began
to develop, such as computer and processing ser-
vices, advertising, security services (Occupational
Outlook Quartely, 2000). According to OECD sta-
tistics, the service sector share of jobs increased by
20% in US, 26% in UK or 29% in France.
Figure 3. Demand for secretaries
Figure 2. Demand for factory workers
Source: NPR (2015).
Source: NPR (2015).
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At the beginning of the twentieth century, eciency
assembly-lines were introduced in corporations to
produce more products with fewer employees. is
trend continued in the next stage of the 20th centu-
ry (Occupational Outlook Quartely, 2000). Robots
and computers have automated many jobs. As we
can see in Figure 2, in 1960, the factories in the US
employed 11% of all employees and in 2013, the fac-
tories employed only 4% (of all employees). is is
due to the introduction of new technologies – ro-
bots. In Figure 3, we can see that in 1970, 5% of em-
ployees worked as secretaries, in 2013, it was only
half. is can be justied by the fact that managers
are equally productive without a secretary, because
the computer soware works instead of secretaries
(NPR, 2015; Desjardins, 2016).
We can see changes in the profession of professors
(Figure 4) and health care workers (Figure 5). e
more automated the factory, the cheaper prod-
ucts were created. So Americans have more money
for services – catering, health care and education
(NPR, 2015; Desjardins, 2016). Since 1950, health
care jobs have increased more than in any com-
parable industrial sector. is is mainly due to the
growing aging population and new technology that
has allowed people to cure themselves from diseas-
es that were once fatal (Park, 2016). Employment in
Figure 5. Demand for health care workers
Figure 4. Demand for professors
Source: NPR (2015).
Source: NPR (2015).
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the health services sector increased by 2.8 million
jobs in 1998–2008 (Occupational Outlook Quartels,
2000). In 2013, 2.6% of health care workers (of all
employed) were employed (NPR, 2015; Desjardins,
2016). Teacher work positions increased from 3.75
million (1990) million to over 6 million (2006)
(Holzer, 2007). In 2013, the employment of teachers
was 1% (of all employed). ese sectors are still la-
bor intensive and increase the number of jobs (NPR,
2015; Desjardins, 2016).
We can see changes in the employment of en-
gineers (Figure 6) and blacksmiths (Figure 7)
(NPR, 2015). At the beginning of the 19th centu-
ry, the engineering professions were represented
only in small numbers. It is estimated that in
1816, there were no more than 30 engineers in
the US. Only with the expanding manufactur-
ing industry, between 1880 and 1920, the num-
ber of engineers increased by up to 2000% (from
7,000 to 136,000) (Braverman, 1974). Since 1900
(0.2% in Figure 6), the demand for engineers has
increased due to the introduction of new tech-
nologies (NPR, 2015). In the US in 1970, there
were about 1.2 million technical engineers em-
ployed in the manufacturing industry, but also
by transport communications, as independent
consultants, government officials (Braverman,
Source: NPR (2015).
Figure 6. Demand for engineers
Figure 7. Demand for blacksmith
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1974). In 2013, up to 1.4% of US engineers were
registered. By contrast, the introduction of tech-
nology has significantly reduced the demand for
blacksmith work. While in 1850 this profession
was request, in 1980, it completely disappeared
from the labor market (NPR, 2015).
In Figure 8, we can observe percent changes in oc-
cupations between 1850 and 2015 in the US. e
biggest percentage dierence can be seen in agri-
culture. On the other hand, the demand for em-
ployment in the areas of trade, education, health
care, etc. has increased. In the period from 1850
to 2015, new technologies have weakened the pre-
vailing industries. Jobs in key sectors have dis-
appeared and have been replaced by new jobs in
other sectors. With the advent of new technolo-
gies, much more jobs have been created than dis-
appeared. e majority new jobs do not belong to
the technology manufacturing sector. e intro-
duction of the computer enabled the creation of up
to 15.8 million jobs in the US in 1980 (McKinsey
Global Institute, 2017). About 90% of the profes-
sions used computers in industries such as call
centers, nancial analysts, and inventory manag-
ers (Lund et al., 2017).
3.2. Organizational change and skills
Study by Pleijt et al. (2018) presented ndings
on the impact of First Industrial Revolution on
skills of workers in Britain. e results revealed
a negative statistically signicant relationship be-
tween the number of steam engines per person in
a county with share of unskilled workers (Figure
9). is suggests that in comparison to perceiving
the industrial revolution as de-skilling (Atack et
al., 2008), it was more skill-demanding. e rst
phase of this industrial revolution was however in-
creasing mostly the low-skilled or middle-skilled
employees, where, according to Pleijt et al. (2018),
it mostly arised from upskilling the farmers.
Chin et al. (2006) in their study examined the im-
pact of introduction of steam ship during Second
Industrial Revolution on the demand on skills in
the merchant shipping industry. ey have found
that the introduction of this technological inno-
vation has led partly to de-skilling, due to change
in work positions from skilled and equipped sea-
men to an engine operation worker. e eect of
the de-skilling from the perspective of previously
needed occupation was that the number of sea-
men decreased, however, those who continued on
steam ships earned premium compared to new
workers on sail vessels (Chin et al., 2006).
Since the late 1970s, companies have begun to
invest in technology, research and development,
knowledge workers. As a result, the demand for
non-skilled workers decreased, it was about 34 of
the labor force. Demand for highly skilled workers
has increased and their wages have increased too
(McKinsey Global Institute, 2012).
Figure 8. Employment share change in 1850–2015, US
Source: Desjardins (2019).
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A survey of medium and large enterprises in 1996
found that 19% of job seekers who had passed
the tests had a lack of math skills, reading skills.
In 1998, this percentage increased to 36%. In
2000, jobseekers had a decit of higher literacy
and mathematical skills (Occupational Outlook
Quartely, 2000).
Wölfl (2005) explains that in the services sec-
tor, the number of highly qualified persons was
higher than in the manufacturing sector in
2002. We can observe this phenomenon accord-
ing to individual country basis in Figure 10. The
share of highly qualified jobs in total employ-
ment of services is between 15% and 40%. This
Figure 9. Relaon between number of steam engines
per person and unskilled workers in Britain
Figure 10. Share of high-skilled employment in total employment per sector, 2002
Source: Wölfl (2005).
0
5
10
15
20
25
30
35
40
45
Portugal
Italy
Austria
Netherlands
Greece
UK
Sweden
Denmark
France
Spain
Finland
Belgium
in persent
of total employment per sector
Manufacturing Total services Market services
Source: Pleijt et al. (2018).
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is because high qualifications are needed espe-
cially in non-market services such as education,
health care and social services. That in the ser-
vices sector, the number of highly qualified peo-
ple is higher than in the manufacturing sector.
Data from 1986 to 2006 presented in Figure 11
show that employment in 2006 has increased
since 1986 in the high-skills and low-skills cat-
egories, and in the middle-skills category, the
demand for jobs has fallen. For example, the
number of nancial managers has doubled from
406,000 to 1 million. Doctors and medical man-
agers have quadrupled from 127,000 to 551,000.
Sales and oce work decreased from 28% to 25%
(Holzer et al., 2007).
In 2005, the Skills Gap Survey was conduct-
ed by National Association of Manufacturers
(2005). The survey shows that the American
manufacturers experience shortage of qual-
ified employees, especially technical skilled
employees. Up to 90% American companies re-
ported a serious lack of skilled workers (engi-
neers and technicians), 65% of all respondents
said there was a lack of scientists and engineers
in the market.
Figure 12 shows the level of qualication of work-
ers in the 27 countries of the European Union +
Norway and Switzerland. e level of low skills
will not be as requested in the near future as the
level of high skills. Employees with middle skills
maintain their standard level and will continue to
do so. e global economic crisis and the resulting
high unemployment caused an excess of human
resources with an adequate level of specic and
transversal skills (skills that can be used in a wide
variety of work settings) (UNESCO-IBE, 2013).
e development of employee skills in times of cri-
sis may be due to public sector subsidies to main-
tain employment (European Commission, 2011).
From Figure 13 we can say that the best jobs of the
future will be those green (technical and social skills).
Social skills are required in the professions, because
developers program their computers to fulll their
role, but they are still not good at listening, empathy,
communication and persuasion (Bersin, 2017).
Some authors however pointed out that skilled soci-
ety does not lead automatically to innovation, rath-
er that the innovation creates the need for skills that
create the ground for utilizing and multiplication of
innovation (McCloskey, 2011; Howes, 2016).
Figure 11. Employment shares by occupaonal skill level, 1986 and 2006
Source: Holzer et al. (2007).
Low; 16%
Middle; 55%
High; 29%
1986
High 29%
Middle
55%
Low
16%
1986
Low; 17%
Middle; 48%
High; 35%
2006
High 35%
Middle
48%
Low
17%
2006
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Source: European Union (2010).
Figure 12. Employment trends by level of qualicaon, 2000–2020
Million jobs
Low qualifications
Medium qualifications
High qualifications
Forecast
50
100
250
200
150
0
50.1%
15%
34.9%
49.9%
20.8%
29.2%
2000
2001
2006
2007
2008
2009
2010
2011
2012
2013
2015
2016
2017
2018
2019
2020
2002
2003
2004
2005
2014
Figure 13. Which jobs require social skills? Change in share of jobs, 1980–2012
Source: Bersin (2017).
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3.3. Organizational change
and education
Industrial revolution and the beginning of stand-
ardization ignited education. While many people
were moving to the industrial cities, it created en-
vironment for rst standardized methods of ed-
ucation, increasing the quality of education that
was widespread compared to previous privileged
system (Katz, 1987). Due to the upsurge of indus-
try, many industrial schools were established to
train necessary skills and knowledge for work-
ers. e need for education arised as well from the
shi from agricultural setting of work to non-ag-
ricultural. Second Industrial Revolution led to
Germany overtake Britain as the most industrial-
ized country. Education thus became critical for
industrial Germany. e schools were able to pro-
duce many inventors and engineers (Hendrson,
2006). From 1890 to 1900, technical universities
in Germany increased their student intake from
5,361 to 14,734 (Chatzis, 2009).
e data in Table 1 refer to the number of workers
(in millions and %) who achieved education (less
than high school, high school, college, BA or high-
er) in 1980–2020 in the US. In 2000, the percent-
age of BA or higher rose to 30 and the projection
for 2020 is 33%. Between 1980 and 2000, the share
of high school diploma people and less than high
school diploma people dropped from 61% to 42%
and in 2020, it should drop to 37%. e percentage
of lower educated people decreases between 1980
and 2020 and percentage of higher educated peo-
ple will increase in 2020. e forecasts also indi-
cate a slowdown in skills growth. is slowdown
may not reach such proportions if more workers
decide to retire later and if more young people de-
cide to attend college (Holzer et al., 2007).
In Table 2, we can see very quick development in
learning opportunities. Leaders recognize that
their internal education programs are lagging be-
hind. Between 1998 and 2002, e-learning was a
trend that could be conducted online. Talent man-
Table 1. Actual and projected supply of workers, aged 25+ by educaonal aainment
Source: U.S. Bureau of Labor Statistics (2003).
Labor force (in millions) Change labor force (in millions)
1980 2000 2020 1980–2000 2000–2020
Less than high school diploma 17. 3 12.0 11.9 –5.3 – 0.1
High school diploma 31.5 3 7. 8 40.4 6.3 2.9
Some college 13.8 32.9 39.2 19.1 6.3
BA or higher 17. 3 35.9 46.4 18.6 10.5
Tot al 79.9 118.6 1 37. 9 38 .7 19.3
Percent of workers (%) Change in percent (%)
1980 2000 2020 1980–2000 2000–2020
Less than high school diploma 21.7 10.1 8.6 –11.5 –1. 5
High school diploma 39.4 31.9 29.3 –7. 6 –2.6
Some college 17.3 27. 7 28.4 10.5 0.7
BA or higher 21.7 30.3 33.6 8.6 3.4
Tot al 100.0 100.0 100.0 0.0 0.0
Table 2. The evoluon of learning
Source: Bersin (2017).
1998–2002 2005 2010 2017 2020
E-learning and
blended Talent management Continuous learning Digital learning Intelligent
learning
Formats Course catalog Online
university
Learning path Career
track
Video, self-authored
Mobile, YouTube
Micro-learning
Real-time video
Courses everywhere
Intelligent,
personalized,
machine-
driven
Philosophy Instructional design
Kirkpatrick
Blended learning
Social learning 70-20-10 taxonomies Design thinking learning
experience
Users Self-study
Online learning
Career focused
Lots of topics
Learning on demand
Embedded learning
Everyone, all the time,
everywhere
Systems LMS as
e-learning platform
LMS as talent
platform
LMS as experience
platform
LMS invisible
Data-driven, mobile
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agement skills were required in 2005, continuous
learning in 2010, digital learning in 2017, and intel-
ligent learning will be required in the next period.
Requirements and systems are more demanding
every year. In 2020, we will be trained by person-
alized and machine-driven systems (Bersin, 2017).
3.4. Organizational change
and technologies
First Industrial Revolution, known also as British
industrial revolution, was brought by acceleration
of innovation. While economic outputs driven by
innovation were mostly created at the end of the
period of industrial revolution (1850s), many in-
novations had rst appearances or rst concepts
even a century before (Howes, 2016). Further, the
pace of adaptation to new technologies, for exam-
ple, steam engines, was aected by regional dier-
ences (Hudson, 1989).
In Figure 14, we can observe the spread and ac-
ceptance of individual technologies, as they were
adopted in US homes from 1903 to 2016. For ex-
ample, US households have started to use landline
since 1903. e number of users grew at a slow
pace, until in the year 2002, landline was used by
up to 95% of households. Nowadays, this trend is
declining and only about 65% of households have
used landline in 2014. On the other hand, mobile
phones started to be used by American house-
holds in 1994, it was 10%. e number of users in
this case grew at a faster pace and in 2016, 92%
of households already used their mobile phones.
Smartphone was used in the US in 2011 by only
35% of population and the number of users rose to
77% by 2016 (Ritchie et al., 2019).
Robots as technological innovations are oen dis-
cussed in the context of current era. However, the
idea of robot was rst introduced in 1920 by Karel
Čapek (Čapek, 2004), while rst electronic auton-
omous robots where created in starting late 1940s,
while, for example, General Motors have bought
a robot for production already in 1961 (Climent,
2015). Not only robots are presented as technolog-
ical trend for future, but also articial intelligence.
Similarly, however, Edmund Berkeley publishes
Giant Brains: Or Machines at ink in 1949 in
which he describes characteristics of articial in-
telligence in a form as it is being developed today
(Berkeley, 1949). Since then, many technologies
using articial intelligence were invented, howev-
er, not mass implementation was conducted.
It can be seen that the pace of innovation adaption
by society has been increasing over time, however,
the time before rst concepts or partial inventions
till the actual innovation and the demand for it on
the market has remained much longer.
Figure 14. Technology adopon in US households
Source: Comin and Hobijn (2004).
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CONCLUSION
Common feature of implementation in all industrial revolutions is the transition from centralization
(steam engine, data processing center) to decentralization (electric motor, stand-alone computer, and
work station). Some technologies were spreading very quickly due to the increasing demand, such as in-
ternet or smartphone, however, many technologies experienced stagnation due to the non-existent mar-
ket for its utilization. Industrial revolutions were bound mainly to the phase of invention, which, howev-
er, did not directly aect the utilization of these inventions, this was rather slow. For example, the First
Industrial Revolution took 120 years to spread across Europe (Schwab, 2017). Nowadays, the boundaries
for spreading are overcome by interconnections in the world and easier access to technologies, however,
the utilization of most inventions is linked to other inventions that may support its dissemination.
e key nding of our retrospective study is the continuous increase in demand for service workers that
occurred during previous industrial revolutions. Not only that, but the pace has been increasing and
the proportion of services jobs to manufacturing has been increasing with multiples. Manufacturing
jobs, such as machine operators, oen occupied by low- to middle-skilled employees, did not disappear,
while during the technological shis, these positions were lled by reskilled or imported human capital.
On the other hand, many service jobs created were new and based on a need for wider knowledge.
Following on the previous nding, the second nding of the analysis of secondary data brings insight
on the role of education during industrial revolution. Education played a major role regarding tech-
nological change, while demand for middle-skilled was decreasing and increasing for the high-skilled.
Countries that were able to produce high-skilled people could not only invent, but also adapt to new
technologies sooner than others. Education played a major role not only in the manufacturing jobs, but
also in the service jobs, which is in line with results of Sugayama’s (1992) study.
Our analysis has shown that the pace of changes and its impact is dierent for development and for
implementation of innovations. In line with fundamentals of Chinese medicine, the development
phase seems to be stimulated by insuciency, while the surplus creates stagnation. Stagnation arises
from the slow adaptation of management to changes compared to the pace of inventions. On the one
hand, companies were able to quickly recognize the need for specic jobs regarding new technolo-
gies, which, however, produced employees with only specic skills that were not applicable to other
technological shis. In this context, revolutions were oen seen in as a reason for de-skilling of pop-
ulation. While with respect to the longer periods of technological change in the previous times, it
could be sucient for organizations to have specically skilled employees, it will be not applicable
for the current pace of change and high competitiveness. While industrial revolutions have created
more jobs over time, from the microeconomic perspective, some positions will still need to disap-
pear, but it takes some time till technologies replace themselves and thus the jobs actually become
redundant.
e nal outcome of our analysis is the understanding that technologies are not the driver of economic
growth, they are a tool that needs to be utilized by companies to create this growth. is was shown by
the adaptation approaches of growing countries during industrial revolution regarding their policies for
education or changes in managerial practices. Companies that have adopted new approaches in utiliza-
tion of human capital were able to build on their competitiveness for a long time. While the managerial
practice has been evolving from “economies of scale of people” into more personal approach, the previ-
ous revolutions have shown that with the new dramatic changes, the managerial practice needs to adopt
as much as, for example, manufacturing processes. e further discussion on impacts of current indus-
trial revolution should thus focus on the expected changes in managerial practices, especially with the
large proportion of jobs created in services, where the traditional view of services as immune to foreign
competition is no longer existent.
476
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e purpose of this article was to return the retrospective view and opinions of past authors to the
current discussion that can enrich and complement the research that is being conducted on the Fourth
Industrial Revolution, which can help other authors interpret their research results. e contribution of
this article is completing the ongoing scientic debate with this retrospective historical context.
ACKNOWLEDGEMENT
is research was supported and funded by APVV-17-0656 titled “Transformation of Paradigm in
Management of Organizations in the Context of Industry 4.0”.
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