The impact of automation on the future of work

By J.P Gownder, VP & Principal Analyst, Forrester.

Automation promises to change the nature of what an organisation is, what a company does, and how work is done. It will free humans from mundane, predictable tasks and enable more complex, fulfilling, and impactful work. Furthermore, it will complicate economies, social order, and peoples’ ability to make a living.

Automation will transform the world in waves. This is best seen in the jumps that technology makes due to an innovation chain: the combined impact of technology advancements created by a step function change to what automation is and what it can deliver.

Move too slowly, and risk being overtaken by competitors; move too quickly, and create operational complexity that weighs down the organisation and confuses (or disenfranchises) customers. Regardless, automation gaps will create the next level of technical debt, where companies aren’t adaptable enough to reap the expected benefits.

Automation in a strategic context

Automation is not happening in a silo. In fact, future-of-work scenarios are informed by parallel trends like sweeping organisational change, the gig economy, the increasing desire for privacy or transparency, the long-term journey of shifting to customer-obsessed operations, the dissolution of industry lines, and the strengthening of “super-platforms.” Islands of automation are everywhere. Automation, therefore, synchronises with parallel trends that inform the different scenarios:

1. Automation must create the adaptive enterprise — with an adaptive workforce — able to disrupt and respond to disruption. Organisations that thrive in the next five years will do so because they were able to leverage digital to adapt to customers, competitors, and disruptors. In 10 years, an adaptive enterprise strategy will be table stakes. The question is which companies will use technology to successfully pursue new opportunities — to act as disruptors as disruption becomes normal.

2. Automation influences, and is influenced, by the gig economy. Automation will accelerate the need for and size of the gig economy, as it displaces jobs and sources the talent able to deliver on certain competencies and tasks. Automation will also enable the gig economy to exist by connecting buyers and sellers intelligently.

3. Ultimately, automation fuels and is driven by shape-shifting organisations. The organisation of tomorrow is nothing like today’s hierarchical and siloed firms with clarity of jobs and boundaries. Instead, it will have a powerful core of purpose and culture with a central control framework for automation — a task- (not job-) driven organisation leveraging both the gig economy and digital outsourcing. This shape-shifting organisation gives context to the structure and role of automation.

4. Automation should assume the emergence of personal data twins (PDTs) and more transparent and balanced privacy rules. Customers are becoming increasingly wary of institutions that use their data outside their sight and permission. Expect customers to build PDTs based on zero-party data and governed by a select set of trusted entities able to act as identity stewards. PDTs will be a key currency of tomorrow's enterprises and ecosystems.

5. Automation must create differentiated experiences and value. The journey to become customer-obsessed is constant. Customer experience (CX) will remain a central strategy to win hearts, minds, and spend. Automation — AI-led whispers to frontline workers and predictive experiences to customers — will be fundamental in delivering digital and human experiences. Those that ignore these whispers will have their CX suffer as a result. Automation is not a singular trend: You can argue that automation will open the aperture to new, previously unthinkable business opportunities as well as be the necessary engine to execute on business strategy.

6. Automation evolves value. New forms of commerce and social platforms are already placing pressure on the companies between the customer and those platforms. These platforms will become more formidable and place those unprepared or unable to appeal to human emotions and needs farther apart from customers.

Automation is not a singular trend: You can argue that automation will open the aperture to new, previously unthinkable business opportunities as well as act as the engine to execute on business strategy.

The automation playbook – what businesses need to do

Independent of whether the future of work seems alien, elusive, and seemingly far away, leaders must embrace a far-reaching and disruptive operational force – today. Automation will make sweeping, sensible, and sometimes cruel changes that can place the unprepared on their heels or in peril. Businesses therefore need to:

ØManage the automation portfolio

Most firms are already managing a portfolio of intelligent technologies that affect the way the enterprise works, albeit in small, surgical ways. Automation will be placed in different parts of the operation with different risk/reward profiles. Those in the back office will pay margin expansion dividends with moderate market risk; those in the front end can pay significant customer experience gains but with acute risk. Leaders must manage the expanding portfolio holistically so that risk and reward is balanced — with special attention to automation that touches customers and can cause unintentional and uncontrollable customer and brand risk.

ØPrepare and hone leadership

Leading organisations and teams will be markedly different than today. The future enterprise will be a shape-shifting one with adaptive workforces that flex as needs evolve. Maintaining a purpose, culture, and brand that establishes distinction and power, managing talent across the gig economy to align to tasks as they come and go, determining the best fit and purpose for robots, and ensuring that employees are empowered and outfitted to navigate this more complex work environment is no easy task.

ØMaximise employees’ value

Employees don’t become less valuable — the opposite is true: They are the critical cultural glue and internal force in the future of work. With fewer employees, they are self-initiating, adaptable brand and culture ambassadors. They keep the core organisation whole and maintain the soul of the company’s front and-centre gig economy workers, who come and go while robots make more and more decisions. The question is not simply how well they are engaged — it needs to be broader.

ØBuild Robotics Quotient (RQ)

Emotional quotient (EQ) became an important measure to go beyond how innately smart someone is to how emotionally capable they are in engaging, influencing, and working with other humans. RQ is the critical next step: how well can humans work with and sometimes for, robots that will play a more sizable impact in day-to-day work life. It’s a measure of how well individuals and organisations adapt to, collaborate with, and drive business results from automation and AI.

ØBuild a learning enterprise

We are past the days of classic change management where the goal was to move a human or team from point A to point B. Going forward, change will be continuous, meaning there is no point B. An employee’s ability (and, in some ways, desire) to learn will be a differentiating competency for firms — moving learning from a tactical hygiene to an economic engine.

Automation will drive significant change, but it will not change what a company is and how it works. The basic meaning and purpose of the company remains intact — to prosper by creating differentiated value for customers. In other words, leaders must guide change and performance in a remarkably different context, mastering the obvious and nuanced in the future of work.

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