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Digital transformation – the history of revolution

Yes, we have succeeded! We created another buzzword that got over-used by all IT professionals, business journals, conferences, practically everyone who has anything to do with IT business. Even though we are all filled up with digital transformation in our everyday talks and meetings, it is not just a phrase. It is a process that has been changing the world for decades. It has also rapidly increased its velocity due to the happenings of 2020.

Decades, you say, how about centuries? Isn’t digital transformation just another giant leap in human history as all industrial revolutions were? This is a story of how our digital world came to be. Feel free to relax and dive into the history of the 4th industrial revolution.

Mrs. Watt was cooking…

It is the middle of the 18th century — the starting point of our story. Young James Watt observes his mother as she eagerly cooks lunch on a wood-burning stove. As time went on, the water in the pot boiled, and the lid bounced briskly, making a soft sound. And so, our hero James realizes that water, or in this case water vapor, carries the energy that can move things. In this case, it moved a lid, and later a piston that will power machines, trains, steamships, and some similar inventions, not many years after this incident.


James Watt’s advanced steam engine will power machines, trains, ships, and more

The steam engine was the general fuse for the explosion of the innovation that would follow and create a whole new world of industrial plants, chain production and distribution, and mines. It has also created a civil society and marked the end of the feudal system. Factories became new businesses that employed more and more workers.

Everything changed – completely new professions emerged, changes took place in education to create an adequate workforce. The steam engine is the real driver of this industrial revolution, put into operation by one of the first real engineers — James Watt. A century of coal and water vapor followed.

And they lit up Buffalo (and Chicago)

Nearly a hundred years from Watt’s steam engines, and some fifty years from Fulton’s steamship, Thomas Edison was born, the first of three key players to bring us the second industrial revolution. Although many before Edison experimented with the application of electricity for lighting, he is still the most responsible individual for the fact that we live in an artificially illuminated world today.

Edison has built a little electric empire, comprised of the first electric motors, light bulbs, batteries, and many other inventions. However, it is difficult to argue that he is the most deserving person for the emergence of the electrical age, not even close.

Edison’s electric world is a world of low-voltage direct current, which can illuminate a room or power an engine in the vicinity. Its main flaw is that it is not transferable to a distance. This shortcoming was not a problem for Edison, but a business opportunity on which he made his fortune by selling direct current generators.

So in those years, if you wanted to use electricity in your industrial plant, you first went to Edison to buy a bunch of “hardware” that you then stacked, configured, and maintained so that your pipe factory would have production capacity.


Monument to Nikola Tesla at Niagara Falls, where the first AC power plant was put into operation in 1896.


By the power of watter…

If we were to single out the main thing Edison did for humanity, we could say with great certainty that it was bringing Nikola Tesla from Europe to America. Edison thought that Tesla could help him improve the efficiency of his generators and electric motors. So Tesla came to the US and was spending the nights closed in the halls earning his first dollars.

However, Tesla had a clear vision of the alternating current during his studies, and now he had the opportunity to experiment. Over time, with the generous help of George Westinghouse, Tesla perfected generators, transformers, and electric motors. In 1893, 200,000 light bulbs were spectacularly illuminated at the (in those times largest) world technology fair in Chicago. They were powered by Tesla’s alternating current. Shortly afterward, construction of the first large hydroelectric plant at Niagara Falls began so, when Buffalo, a town 22 km away, was lit up on November 16, 1896, it represented the beginning of the second industrial revolution that would illuminate (or rather electrify) the entire world.

From Edison’s company came a young man — Samuel Insull, who will make a fair profit from all of this (in fact, not him but the company he is going to found). It was him who suggested to Edison the transition to alternating current, the construction of power plants, and the sale of electricity per kilowatt-hour. Edison just waved his hand. After Westinghouse got into trouble, Insull, with the help of partners, rose to power by building power plants across America. For the sake of information, the company he founded is now called General Electric.

And so, the horses disappeared…

The first two industrial revolutions completely changed the way the world before them functioned. Numerous new professions were created, and an increasing number of the population gathered around larger centers or cities — the first so-called metropolises. Internal combustion engines will also be a great innovation enabler, from cars, trucks, boats, tractors, combine harvesters to airplanes and helicopters.

However, before the creation of the car, people were transported around big cities by horses, more precisely carriages, pulled by horses. To keep the city clean and tidy of “remnants of horse digestion” hundreds and thousands of people had the task of cleaning the streets and squares several times a day.

When we multiply that by the number of newly created metropolises, the profession of cleaners was extremely sought after and widespread. Times Square was already crowded with people. They were just looking more under themselves than around them.

A few years after Benz and Daimler drove their prototypes, Ford and the team will start mass production of the cars that will replace carriages and horses and everything related to them once and for all. The groomer, the coachman, the horse-food sellers will disappear. There will be no need for numerous watering cans, and in the end, those previously mentioned cleaners from Times Square will also disappear.

People were complaining: “Hundreds of thousands of people have lost their jobs due to advances in technology. This is a terrible thing for the future of humanity!” Does it remind you of something you hear every day? Job loss due to digitalization, automation, robotics… The working class loses many battles every day due to advances in technology!

Of course — there is more to that story. Yes, the some jobs and infrastructure have indeed disappeared, but new ones have been created. Mechanics started repairing engines, vulcanizers changed and repaired the tires, cars needed to be washed from time to time and, I won’t even mention that gasoline consumption made a few billionaires.

Driver-less car, much like a horse-less carriage…

The old has disappeared, something new has emerged, as always in the history of mankind. Today nobody is crying for cleaners, just as cleaners were not shading their tears for copyists who had their hands full before Gutenberg’s printing press. In the same way, Uber will, years later, terribly irritate taxi drivers (modern coachmen, without any insult) around the world, replacing middle-mans like taxi services and dispatchers with a simple mobile app and a scalable cloud back-end. The transport service thus became more accessible and smoother than ever, the quality was improved and the price reduced.

Also, the model in which anyone can be a driver will create many other motivating factors for (temporary) employment. People will drive because they love driving, want to meet people, spare time, and the like. Along the way, they would earn for dinner, going out, a new gadget, or something else

However, the Uber revolution is just beginning. They have a much, much bolder goal. Have you heard the story of autonomous vehicles? Of course, you have. Well, these autonomous vehicles are the real desire and idea of the creators of Uber — to completely replace the human factor with software running in smart cars that would simply transport passengers from point A to point B without any human intervention. Sounds scary? Of course. Is it happening? Don’t even doubt it!

Blue suits and garage masters

But let’s get back to the digital transformation, the revolution, or whatever you want to call it. If we fast-forward through Charles Babbage, Turing, von Neumann, and other theorists, we will come to the first electronic computers, the Colossus and ENIAC. Their applicability was truly questionable, and from today’s point of view, it is difficult to perceive them as the beginning of digitalization.

On the other hand, the IBM computers that will follow will begin to digitize specific processes, first in the United States and later around the world. It was a time of terminals and mainframes, computer forms that were affordable only to large organizations.

The mid-1970s brought us the beginning of the great “garage wars”, which would produce two gigantic companies. At that time, several smaller companies, as well as independent teams, were playing with various options for creating cheaper computers. Some even resorted to the thinking that the computer would be so cheap that ordinary mortals could afford it for everyday use, even entertainment.

Ataris, Apples, Commodores, and the like appear. Until then, the boring command line, or as we called it, the textual interface, is being changed with color graphics and similar novelties. Xerox is experimenting with a graphical user interface, Apple is creating a mouse, and Gates is blabbering on about the value of software and gives IBM the right to distribute DOS on their computers, retaining ownership of the software and the right to sell that software to others.

All the above, in just a few years, will create a world of cheaper computers that we will start to be called personal. IBM, HP, Compaq, Dell, and many others will create pieces of hardware on which they will distribute Microsoft’s as well as many other software products. Apple, on the other hand, will work on its software, which they will sell together with hardware.

Caught in a Web of digital transformation…

As a result of all this, in the early 1990s, the number of computers per household will increase many times over, and most organizations will have numerous so-called workstations in offices. The year 1990 will also bring us the World Wide Web, now popularly called the Internet, which will, for the first time in history, connect a complete globe into one great data exchange network.

It is this event that most theorists will take as the beginning of the revolution that we recognize today as digital transformation or the fourth industrial revolution.

Numerous changes will follow – Internet connections will become faster, hardware cheaper, processing power will double every year. New incarnations of computers in the form of smartphones and tablets will emerge, which will start ruling the world and take the lead in Internet traffic in just a few years.

Global players will build large megalomaniacal installations of servers and network equipment that we will call cloud data centers. They will store thousands and thousands of petabytes of data and spin tens of thousands of processor cores. Those CPUs will process the contents of internal memory measured in hundreds and thousands of terabytes of RAM.

And so it begins, again!

Throughout this period, so many jobs were created and disappeared. All in all, one thing is crucial — any technological change necessarily means a change in human society. Progress certainly eases up our lives and opens up new opportunities. This is the key to positive thinking about any transformation, any revolution.

While ease will necessarily mean the disappearance of some jobs, new opportunities will create new and more interesting ones. It was so in Athens and Rome, so it is in today’s megalopolis called the world!

Tomislav Tipurić

Tomislav Tipurić

Tomislav Tipurić is CTO and a partner in Nephos - a company that successfully supports the digital transformation of their clients at home and abroad with its products and services. Before joining Nephos, Tomislav worked for Microsoft for 10 years, the last few as a technology strategist for partners that embed Microsoft's technology and cloud services into their own products. During his career, he has worked with many companies in the region, from the smallest startups to renowned large companies, helping developers and system engineers to apply the latest Microsoft technologies. He is currently focused on the world's leading cloud technologies (Azure, Google and AWS), DevOps topics, artificial intelligence, and the way of doing business in the era of the 4th Industrial Revolution. He spends much of his time transferring knowledge through workshops and lectures at numerous conferences in the region, helping individuals and businesses to be more successful in applying digital technologies.
December 2, 2020
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