Like it or not, the robots are coming. And if you buy into the fear-mongering headlines, dire research papers, and gloomy statistics, the emergence of artificial intelligence and other advanced technologies all but guarantees the extinction of human jobs. Fortunately, if history has taught us one thing, it’s that automation is very rarely the end of the world. In most cases, it marks a new beginning.
The jobs are alright
There’s no question that AI has the potential to replace vast numbers of human jobs and completely reshape the workforce as we know it. Not only is this already occurring, but it’s kind of the point. Technologies like robotic process automation (RPA), cognitive, and AI are designed to be better than humans at knowledge-based tasks—which isn’t necessarily a bad thing.
“Machines are good at knowledge, but human beings are good at wisdom,” says Jack Ma, founder and chairman of Alibaba. “You can always teach a machine to have knowledge, but it’s hard to build a machine with a human heart.”
To say this spells the end for human workers is not only needlessly alarmist, it completely ignores the upside. Which, perhaps, is understandable—since we’ve been greeting technological change with a “glass-half-empty” view since the first industrial revolution.
Case in point: The textile industry. Between 1761 and 1850, automation reinvented how cloth is made—as countries across the world moved from the individual handloom weaver to burgeoning cloth production factories. Automation made it possible to produce cloth 50 times faster—increasing supply, lowering the cost, and making it more accessible to consumers. As a result, the cloth industry exploded—and while the role of the weaver morphed into more of a “machine-manager” position, the demand for them nevertheless increased 40% during the era.
Of course, at the time, naysayers abounded. The new set-up forced many female weavers to leave their home-based handlooms and families to work long days at factories—leading many to lament the destruction of the traditional family structure. Many weavers were also disrupted by the technological shift—either because they were too old to leave their homes or couldn’t master the new machines.
This tale makes it clear that there are always two sides to an industrial revolution. You can focus on the jobs that are disappearing—or you can position yourself for the jobs being created. And that lesson is as relevant today as it was back in 1761.
Using automation to unlock value
“People are already unhappy because a lot of machine learning and AI are starting to kill a lot of jobs. People are starting to worry,” says Ma. “If you’re not innovative enough—if you’re not creative enough—your job will be taken away by machines.”
This is likely one of the greatest differences between the Fourth Industrial Revolution and the first. If you consider that most organizations are veering towards semi-automation—selectively using automation to fix targeted, organizational pain points—it’s unlikely their efforts will eradicate human workforces. Rather, the democratization of AI is making us experts in our jobs—we have the power to choose where technology will add the most value, and ultimately dictate how our roles will change.
“Anecdotally, automation done well can help companies reduce costs by up to 40%, but most companies don’t opt for full automation. Instead, they typically capture roughly 20% of their savings and use the remainder to hire new people or redeploy existing resources to perform more value-added activities that differentiate them in their markets,” says Paul Skippen, Partner in Deloitte’s Risk Advisory practice. “This makes sense—if people have more time in their day, they can deliver improved outcomes.”
So, if your organization implements automated processes that promise to eliminate the most mundane aspects of your job, freeing up 40% of your time, how would you use that extra time to deliver more value?
It’s not an easy question to answer. To help get our heads around it, let’s look at the annual audit. Until recently, auditors were confined by manual processes to review random samples of an organization’s transactions when conducting audits. Automation is changing that by giving auditors the ability to do universe testing.
Not only does this improve the quality of an audit but, because technology takes care of all the data collection, auditors now have considerably more time to provide in-depth observations, detect possible patterns, and proactively predict what the patterns could mean. As a result, companies are gaining a more accurate understanding of how their strategy is executing in real life.
Automation also stands to dramatically improve the risk function. Take the quarterly financial close process, as an example. RPA offers risk the opportunity to improve the rate at which it reviews different scenarios and conducts analyses, making it possible to offer more added value leading up to financial close—and more efficiently guide corporate strategy. While this will likely mean the risk function will eventually require fewer data clerks, this loss will be absorbed by the need for more people to run models and conduct advanced data analysis.
“I would even argue that it will increasingly be the job of internal auditors to become intelligent automation experts,” says Paul. “When internal audit is reviewing the second and third lines of defense, they should be calling out areas in the company that are too manual and thus pose inherent risk to the company. Similarly, they can point out where a cognitive helpdesk may deliver more value or where an RPA can reduce errors.”
This is a prime example of how AI has the potential to empower rather than victimize. In the semi-automated organization of the future, every employee—in every role—will have an opportunity to make their jobs more engaging, less labour-intensive, and more valuable to their respective organizations. This shift in thinking won’t be seamless, but for those willing to adapt, the possibilities are not only endless—they have the potential to change the concept of work for the better.
Join in on the conversation with Paul Skippen when you subscribe to Exponentials.