Workplace Automation

By Guy Higgins

I recently read an analysis report by the McKinsey Global Institute, Where Machines Could Replace Humans – and Where They Can’t (Yet). I found the analysis very interesting, and I think that workplace automation is something that organizational leaders should understand and think about – very hard.

I found several take-aways that I think are worth considering:

  • The jobs (independent of industry) most amenable to automation are those jobs that involve predictable physical labor. These include those job categories that you would expect such as production-line tasks, but they also include other tasks such as data collection and input. Jobs that require unpredictable labor (the examples McKinsey used were agricultural labor involving decision making and on-site construction) are less amenable to automation, but even these jobs involve numerous tasks that can be automated using technology available today.
  • The tasks amenable to automation are almost universally those tasks that require the least education and job training and are, therefore, the least well compensated jobs. This low level of compensation creates a dynamic that leaders need to consider – is the cost of automation low enough and the return from automation high enough to justify automating a task? There is a secondary dynamic here that needs to be considered – many of these less well compensated jobs provide the pool of individuals from which leadership can draw employees with skills and knowledge to fill jobs less amenable to automation. It’s conceivable that automation could result in some degree of “eating your seed corn.”
  • Some jobs that involve tasks that are highly amenable to automation also integrally involve human interactions (e.g. a retail shoe clerk – retrieving the correct size and model shoe is easily integrate-able, but the customer interaction – not so much). For jobs involving these tasks, the social aspects of the job and the customers’ acceptance of automation, rather than personal interaction, are the drivers (and will likely remain so for the near term future).
  • The jobs that are least amenable to automation are jobs that involve applying expertise and jobs managing (McKinsey’s word – not mine, I prefer “leading”) people. These are also among the most well compensated jobs and those requiring the most education, training and experience. This goes back to the “eating the seed corn” issue surrounding the automation of the least well compensated jobs. If those jobs become completely automated, there is a risk that entry into jobs providing the needed experience at more senior levels will become more difficult and the pool of candidates smaller with more limited experience. This is not a reason to refrain from automation, but rather a risk that needs to be considered.

Automation of work is an enormous productivity enhancing effort and one that leaders need to continually consider. Higher productivity means better, higher-paying jobs for employees and lower prices with better quality products for customers. That said, not everything that can be automated should be automated. There are other factors to consider when automating work. Those factors include the return on the investment in automation and the potential for disrupting the career pipeline leading to future senior leadership and management jobs.

Thoughts?

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