Today’s post is a guest post written by Nate Vickery, a business technology expert and a futurist mostly engaged in finding and implementation of the latest technology trends into SMB and startups management and marketing processes. Nate is also the editor-in-chief at business oriented blog- Bizzmarkblog.com. He has written this very interesting post about business automation.
Since the last recession, the main drive within business has been to reduce cost by eliminating labor, and then to replace the labor with business process automation that is capable of working without any human involvement whatsoever. According to an analysis recently published in Davos, the rise of automation will result in a net loss of more than 5 million jobs over the next five years. While some employees continue to hold jobs, the automation process reduces much of the business routine work, and in some cases – eliminates the decision making process.
Prime BPA Examples
Pressed to work lean, many CEOs, CFOs and those working for them continue to seek out business process automation; furthermore, they look to automation to reduce human error and to promote efficiency and consistency across the organization. As an example of automation, we can take a look at modern warehouses. Many companies now have fully automated warehouses, where mechanized shelves pull the inventory and then roll it up to a warehouse worker. Now, according the Bureau of Labor Statistics, there are around 810,000 warehouse workers in the United States, with an average wage of $10 per hour. The government has taken action to increase the minimum wage to $12 an hour in the next five years. This could potentially only make matters worse for warehouse workers, considering the low cost of BPA maintenance.
Advantages of Automation
To say that automation brings nothing to the table would be absolutely wrong; in fact, according to research conducted by Clarity Ventures, over 70% of time and resources in enterprise business without automation is wasted planning and devising business processes and strategies. What’s more, most transportation businesses now use analytic dashboards that track traffic and fleet usage and automatically re-provision delivery vehicles to ensure that all service territories are completely covered. There are also various employee management software solutions on the market that help managers save a lot of time and on tedious tasks, and instead focus on the actual problem solving. These systems have delivered cost savings to companies, but there can also be a “dark side” to all of this automation, which begs the question: How much BPA is too much?
Problems of Humanless Management
Perhaps the biggest problem with complete automation is the lack of employee training provided by companies. Let’s look at retail for an example, if the input to the system of one item code is overlooked, an employee at the checkout cannot figure out how to manually key in a price. Another good example is the customer service call systems that have become too complicated. In fact, according to a Global Consumer Pulse Survey, around 80% of customers would rather try to solve their problem with a real person than interact with a machine. Companies now are running the risk of breeding out so much intelligence from the BPA, that they don’t have sufficient trained staff on hand to do jobs that still require critical thinking.
What are we Exactly Trying to Improve?
As we said before, the automated process has offered some astounding improvements in productivity in the last two decades; moreover, large improvements in cost performance can also be traced to automation. Nevertheless, have we improved the quality of customer experience? Or, have we really improved the quality of doing business? These are still open questions. Perhaps the biggest danger of over-automation is its potential to condition workers into mentally lifeless behavior. So when a smart analytics report delivers data that fails to sync with what is really happening, no one is there to think through the situation on its own.
Low-level jobs are slowly vanishing, Thomas Frey, the Senior Futurist at the DaVinci Institute, predicts that by 2030, roughly 50% of jobs on the planet are going to disappear. The process of automation is inevitable, and the best CEOs have to find the way to balance the enormous benefits of it with an equal need to hire intelligent and capable employees. These business leaders have to ensure that the workers don’t lose sight of the business and that they understand that automated business processes are just tools.