Impact of Automation on Your Job

October 11, 2021
Impact of Automation on Your Job Nandan Mullakara

There is a lot of talk about automation and the disruption of jobs globally. 

How true is that? What is really being automated? How does that impact your job? 

As an Automation professional, I like to give you an inside look at what is really happening and answer these questions. 

Let’s start with some background.

Impact of Automation on your job

History of automation

Since the beginning of time, humans have sought to make their work easier. From our ancestors using stone tools to Gen-x using smartphones, it has been a story of technological advancement and improved productivity.

At one point, most of humanity was employed in agriculture. Now, in all advanced countries, the same task is being performed by a small number of farmers. The same has been true of Manufacturing where people moved from farming. In the US, manufacturing jobs have declined from one-third of total employment in 1945 to about 1 in 12 jobs today.

how automation is affecting every day life and jobs


And what do you think has been happening with our farming and manufacturing output? The value of farming and manufacturing output has actually increased thanks to our technological advances! 

Now that most of the population is engaged in Service jobs, technological advances have been making them more productive as well. We started with computerization in the 1960s followed by Business Process Management (BPM) in the 90s that optimized services work. Most of the organizations also implemented Enterprise Resource Planning (ERP) which has become the backbone for most businesses today.

Now, with the next wave of technological advances, the office work being performed on ERP and similar applications are being automated.

The new wave of Automation

We have new technologies that can “think” to a certain extent and can also emulate your actions at the computer. The ability to emulate your actions at a computer is called Robotic Process Automation (RPA). 

The best way to visualize Robotic Process Automation would be to think of a person working on his computer and doing his daily job by clicking through computer screens, sending emails, etc. Now, what if the computer clicks through, enters required data, and performs the same work automatically? That is what RPA enables.

The new wave of Automation

The bigger development though is that apart from being able to automatically do your computer work, the computers are also able to figure out patterns (“think”) from data with what is called Machine Learning (a part of Artificial intelligence).

This is a big deal because for the first time in history computers can program themselves, and even carry out actions. For e.g. a computer can collect data as you work, and suggest how best to do a task and if allowed, even carry out the task for you – all automatically!

So, while computerizations made service work easier, we are now into a phase where we are automating the computer work itself.

What’s really being “automated”?

We are currently in the process of automating repetitive computer-based work. As we will see, AI and RPA are only good to automate certain types of tasks.

Tasks not jobs

One of the key things to understand Is that none of these new technologies are automating complete job functions. 

That is the reason most of the job loss estimates vary a lot. They use different assumptions to come up with “job loss” estimates. Most of those estimates are not worth the effort. I think what we will see is a gradual change in jobs just like we saw in earlier shifts. 

RPA and even AI are like a monkey army that can do some specific things better. RPA can do tasks that are well defined like click there, copy-paste, enter that data, etc. better. AI can match patterns and figure out things like that is an Invoice number etc. using prior data.

Humans and machines relationship

Source: Deloitte

Further, to make it worth the investment, only those tasks that are very repetitive in nature make the cut. And these tasks are just a part of what a person does as part of their job. For e.g. We are able to automate some of the financial tasks like three-way matching, or journal entry, or account reconciliations – just a part of what the finance team does. 

Here is a list of specific RPA automation use cases that gives you a sense of the tasks that can be automated by business area:

RPA automation use cases

Also, some of these tasks can be automated completely but in a majority of the cases, the machines augment the work being performed.

Augmentation not replacement

Some of the automation vendors created a hype that all the jobs can be automated. 

This sent a wrong message to the management as well as people doing the job. They were carried away from the initial successes on tasks that were very amenable to automation.

In the automation world, we have two types of automation – Attended and Unattended. Attended automation augments what a person is doing at a computer while Unattended automation actually does not need a person and these tasks are taken over by the machines. 

Over a period of time,  we have seen that there is more scope and demand for Attended or Personal automation. At one point in time, we were doing 80% Unattended (and hence the euphoria) while we are the other way round now with more Attended or augmented automation.

So, we have been automating specific tasks completely or by augmenting people. This has led to certain industries and business groups performing their work more efficiently.

What’s the impact on the ground?

The impact varies from industry to industry and from organization to organization. But from my experience, not many people are eager to replace people, at least immediately. 

As we saw, we are not automating jobs and so there is no one-to-one correlation to the people that need to be removed. Also, many have learned from the ERP implementation days that retrenching people with knowledge is not prudent. Smarter organizations are not letting knowledge walk out of the door. They evaluate how best to use the knowledgeable manpower.

This is supported by Deloitte’s 2017 Global Human Capital Trends report of more than 10,000 HR and business leaders across 140 countries. Only 20 percent of those surveyed said they would reduce the number of jobs at their companies. Most companies (77 percent) said they will either retrain people to use technology or will redesign jobs to better take advantage of human skills.

Having said that, Automation is pretty effective in specific industries where we are seeing an impact. As of now, most of the current software-based automation has happened in Banking and Finance industries. In the longer term, we can expect automation to increase across industries. Here is a view of impact by the industry as of 2020:

Global RPA market share

Across industries, there are specific job functions and jobs that are more amenable to automation. That will decide if and how automation would impact your job.

Will it impact your job?

Irrespective of industry, the impact on your job depends on the tasks you are doing and to some extent the job function you are in.

Type of Job

As we saw, machines are good at specific things. Does your work involve more of the mindless work that the machines are good at? If you are doing well-defined and repetitive work, chances are machines can do that better.

One rule of thumb is to check if you can document your tasks and give them to someone and they can learn how to do your job. If so, part or most of your job could be automated now or sometime in the near future.

And we see these repetitive tasks are more prevalent in some business functions than others.

Business functions

The business area with the most automation potential is Operations as per PWC’s Financial services RPA Survey. The area with the second-most potential for automation is Finance & Accounting. As per a McKinsey study, more than 60% of the F&A tasks can mostly be automated. There are opportunities in Human resources as well with as much as 50% of the processes amenable to automation as per Deloitte. The automation potential is again across all functions but keeps decreasing as we see below.

Impact of Automation in certain industries

There is some real impact in certain industries and business functions now and in the longer term, we may have a more substantial impact as the efficiencies start kicking in. 

Let’s be ready for the changes.

The next big shift

It does look like we are in the midst of another shift. With machines gradually getting better at service economy tasks, we could be moving to a new economy and surely new ways to work.

It is not clear what the new economy will look like – just as in the past, we will only know once we are well into it.

But here are some pointers:

  • About 20 to 30% of the working population are engaged in independent work on digital platforms like Etsy, Uber, etc. as per a 2017 Mc Kinsey study. Called the gig economy, this market is currently at 300B and is forecast to reach $455BN by 2023. 
  • Solo entrepreneurs and partnership firms are emerging as the barriers to micro-entrepreneurship have decreased. As per the Census Bureau, there are about 40k such firms in the US alone with more than $1 Million in annual revenue.
  • We are seeing an increase in the number of people who identify as “creators”. As per a survey by Signalfire, about 50M people globally now identify as creators. This has led to a “creator economy” which is estimated to be a little over $100 billion dollars and has seen a record $1.3B in funding in 2021 alone.

So, we are seeing a proliferation of side hustles, solo entrepreneurs, and more creators. This is leading to the emergence of a new kind of digital capitalism. 

All these new forms of work have a common thread – the ability of people to do more with machines. And that’s probably what you got to do to be ready for this next big shift.

What can you do?

As with each major change, there is fear and anxiety. We are still in the midst of the shift and based on what we can see, here are a few things I think you can do now:

Focus on your skills

Given the uncertainty about jobs, I think the first thing you can do is to delink who you are from your job title (e.g. VP of a company) to identify yourself with your unique strengths and skills (helping people with unique skills).

Beyond your current skill set, it would be prudent to add new skills that help us adapt to the change. As we saw, the common theme is people doing more with technology. Most current jobs would be redesigned and reimagined for a hybrid environment of people and machines – each doing what they are best at. 

So, if you are on the business side, and have been honing your technical skills by working on spreadsheets and maybe new apps, now is the time to step up and learn some no-code or low-code that can help you do your job better.  You are more likely to keep your job if you are more productive with machines. 

Now, if you are a technology professional, don’t think that this is only for business people only. I would suggest you look to add business skills. The silos are disappearing and you will be called upon to do more. With the lines dividing business and technology blurring, the best techies of tomorrow would be able to understand the business needs better. 

I know that picking up new skills is always a given but many of us just do the minimum and let the newer generations pick up the latest skills. With the rapid changes in technology and business, we have to upgrade our skills more often. In fact, it is better to get used to life-long learning.

With each of us getting more efficient, we could probably do more than one job?

Build a portfolio

Again, keeping with the theme of doing more, we probably may have to get used to doing more than one “job” at a time. 

As we saw, the gig economy is growing. As per one survey, 40% of the US workforce is making at least 40% of their income via gigs. Also, 64% of full-time workers are saying that they want to do “side hustles”. As these side hustles increase, people are becoming more strategic about it. 

They are building a portfolio that goes beyond gig work by understanding what their niche audience needs, mapping to their strengths and skills to deliver amazing experiences. This is creating a powerful micro-entrepreneurship business model.

Get involved in the emerging economy

It may be early days but you could get ahead of the rest if you can learn the ropes of the emerging economy. 

You can start dabbling with the tools and strategies that micro-entrepreneurs are using. You can follow and learn from people who have built audiences in your areas of interest.

You would see that with the rapid advancement of technology, people are partnering with machines to launch and scale more and more complex projects and businesses.

With technologies like AI and Robotics, we could well be on our way to create Billion dollar Micro Corporations. These micro corporations have one or very few full-time employees. They simply leverage an ecosystem of people and machines as needed.

Time will tell where this next shift will lead us to, but these developments are a pointer of things to come especially with a decentralized Web 3.0.

So, let us be ready for the new shift away from jobs as we know it. We will go from doing work for work’s sake to doing work that we love. We have been on this journey for quite some time and hopefully, Bots will finally get us to that Nirvana!

Nandan Mullakara

Credits to: Nandan Mullakara

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