Thailand 4.0 – are we ready?

September 15, 2017
| Thailand

by Panittaya Changchit

Like many other countries, Thailand is currently undergoing major changes spurred on by a set of interconnected challenges such as the forthcoming digitalization of the economy, its aging society, the rising cost of health care, talent shortage and the need to transform its human capital management scheme.

Given these challenges, the government is taking steps to move the country towards "Thailand 4.0", a new economic model that will ultimately result in more value-added, higher quality products and services. But to achieve this, the development of human resources is also a necessity.

How Thailand 4.0 will affect the workforce and the future of work

The path towards “Thailand 4.0” represents a significant challenge for the Kingdom’s economy, with the emergence of a new model based on creativity, digitalization, innovation and R&D, new technologies, automation, robotics or artificial intelligence (AI).

The transition towards Thailand 4.0 also means a dramatic change in the country’s education system, both in its philosophy and in its implementation, as it will require a “knowledge workforce” able to drive this transformation. For instance, companies may rely more on flexible teams working on projects rather than being organized around permanent workers with fixed long-term jobs.

Some predictions reveal that, on a global scale, a third of all jobs will be undertaken by robots in 2025. Researchers at Oxford University even believe that about 47% of all jobs could be overtaken completely by robots within the next two decades. According to the International Federation of Robotics, 2.32 million robots will be used worldwide this year, including 41,600 in Thailand. Eighty percent of these robots are used in the industrial sector and the remaining 20% in the service industry.

The workplace is constantly evolving at a rapid pace, with technological changes and increased digitalization already taking place. The traditional long-term jobs that we know are being replaced more and more by “fixed term” tasks, as companies become less inclined to propose permanent jobs. We also see many jobs where automation, artificial intelligence and robotics will be replacing humans, causing numerous jobs to disappear. A lot remains to be done in terms of organizing personnel who will continue to fulfill ‘human’ work, plus the entirely new jobs that will surface. All this will require a different way of organizing, managing and rewarding the people who join the workforce.

Human resources in the age of Thailand 4.0

Apart from digital disruption, companies in Thailand are also struggling with talent acquisition challenges. Firstly, because the aging population continues to grow, there will be less people of working age in the coming decades. Secondly, employee loyalty is constantly declining, especially among the younger generation. This makes it more challenging for companies to keep their talents.

With the advent of Thailand 4.0, HR departments need to react with agility, flexibility and rapidity. It becomes crucial for them to:

  • Understand the company’s business strategy and the changes ushered in by new technologies.
  • Consider the cultural attributes and organizational capabilities that can foster a competitive advantage.
  • Study the work landscape and prioritize the gaps to be eliminated.

HR can play a critical role of supporting companies as they gradually evolve from a group of individuals accomplishing different tasks to an entity that organizes work and talent to deliver products and services. The talent may come through regular employment but may just as easily come from a talent platform. And the functions within the organization may require new combinations for collaboration, teamwork and getting work activities done. We may need to think more openly about how to move functions in and perhaps outside of our organization. Organizations have the opportunity to ‘redraw’ these relationships to recognize where different connection points are required. This certainly has wide ranging implications for how we attract and retain talent.