What does the future have in store? A question that has probably been asked more times than anyone can count over the last 18 months. And one that seems to have a different answer every day. COVID-19 has disrupted everything in its path and changed the environment around us in ways we didn't think was possible. Work has changed. Learning has changed. The way we consume has changed and it's all happening rather quickly. Changes in behaviour that pundits believed were decades away occurred in months and there's no sign of this cultural and societal change slowing down anytime soon.
The problem is keeping up with it all and ensuring that your business is future proof. The solution? Enter automation. In a changing environment, one that requires agility, speed and accuracy, automation has offered it's hand in generating solutions to issues highlighted by COVID. It's working too. Automation technologies have provided short-term solutions that have allowed businesses to stay open through lockdowns and work safely. However, there's still a lot of uncertainty around the future of automation and the long-term effects of implementing it.
So, what does the future post-COVID have instore for SMEs? Is it going to be everything we've feared it to be? Is it actually sustainable over the long-term?
As we discussed in a recent article, in the current business environment, automation technologies such as robotic process automation (RPA), artificial intelligence (AI) and the internet of things (IoT), have helped many businesses continue operating through lockdowns and social distancing measures. But it didn't come without issues. In the UK, a survey conducted by Studio Graphene found 49 percent of businesses were not prepared to transition to remote working, and 39 percent did not have the technology to support it. This meant 48 percent of firms had to invest in software and 72 percent of firms had to invest in new hardware. These changes usually would have occurred gradually over the course of a couple of years, giving firms time to investigate the best possible solution. Instead, changes occurred rapidly, and automation technologies were implemented within weeks. It was no longer about thriving. It was about surviving.
Technology wasn't the only thing that changed either. Businesses were forced to rethink their processes. How they served customers, how they produced goods and services for customers and how they shipped those goods and services to customers. With COVID, consumer buying habits changed, and so did store dynamics. Stores went from physical and social spaces to digital and transactional places. Safety became more valuable than what was bought in the eyes of the customers. However, in countries like Australia and New Zealand, this trend has shown to quickly reverse once lockdown measures were removed. Why? Humans are social in their nature and desire interactions with others. MIT Researchers have compared the cravings for social interactions in those who have been isolated similar to the way a hungry person craves food. It's almost impossible to substitute the value of human interaction, although some have tried. In Canada, robotic baristas are becoming more popular. And although they make better coffee than their human counterparts, customers are displeased about paying for machine-made coffee as it seems the value of knowing a human brewed it is more valuable than the taste itself. So, it seems that despite the growing automation trends, there will always be a need for socialising.
One of the biggest fears many have surrounding automation concerns job displacement and how labour markets will respond to increased levels of automation adoption. The natural design of automation technologies, like RPAs and AI, is to reduce the need for human interaction in the completion of repetitive tasks. Therefore, introducing automation technology has been commonly predicted to cause large numbers of employee displacement. The “lump-of-labour fallacy” has played a big role in generating these fears. This being an idea that suggests there is a finite amount of work. So as automation takes some of these jobs, it leaves less for us humans, right? Not necessarily. Changes to labour markets will be difficult to attribute to the increases in automation technology. It's a complex world, add in a global pandemic and there are a multitude of factors playing their role in the ever-evolving labour scene.
Automation will displace easily automatable roles as wages continue their upward trend, with robotic labour becoming increasingly more affordable than human labour. Topical discussion around this area has suggested that unemployment levels will rise because of this. But in reality, the opposite has occurred. In America, there are 900,000 more lower-skilled jobs available than previously expected, even in the midst of a global pandemic. Australia is offering similar results. Japan, Singapore and South Korea are currently global leaders in robotic adoption, yet all have low unemployment rates. This indicates that automation allows for higher value and a more efficient allocation of labour. This means better employment, not greater unemployment. Fears surrounding job displacement caused by automation seem to have meant many have forgotten about the jobs automation creates too. Automation often provides opportunities to upskill into higher paying and higher value jobs.
It can be very difficult to predict, or even make an educated guess, on what the future has in store with automation. Especially when you throw in a global pandemic into the equation. And even then, the jury is still out on whether automation will be beneficial for businesses in the long-term. Whilst rapid implementation has provided numerous benefits and allowed for businesses to continue operating when previously they would've closed. Beyond that, there's no certainty about what's next. Some still doubt technology can even solve business process issues. Issues around climate change have also occurred as electronic waste (e-waste) levels continue to rise, presenting a real issue in the long-term sustainability of electronic technology use. In New Zealand alone, 80,000 tonnes of e-waste are produced annually. However, only two percent of it is recycled due to a lack of national Government policies. This issue also highlights the lack of Government policies concerning technology and its use. Whilst new policies are being implemented, technological innovation is outpacing regulators' comprehension, leaving many Governments and businesses vulnerable in the interim. This also now involves issues surrounding cybersecurity, which presents the largest threat to technology and its adoption.
Despite the issues that have been raised, there now seems to be very little that will slow rising automation adoption levels. Researchers predict the digital economy could be valued as high as $37 trillion by 2040. It's just a question of whether it can be sustained for a long period of time. In the short-term, automation technologies have become established as the answer to several key business problems faced. But as time passes, more questions will be asked, and automation may no longer hold all the answers.
