W.When we think of automation, it’s usually manufacturing, factory improvements, and companies like Rockwell Automation (YEAR) That comes to mind, but we are seeing an acceleration in the adoption of automation that is also occurring in the world of white collar workers and professional services. While driverless cars and robotic-only warehouses may make the most of the headlines, jobs in more traditional office and professional environments are increasingly facing pressures from AI (artificial intelligence) and machine learning solutions.
A 2019 Wells Fargo (WFC) The research report predicted that automation would cut around 200,000 jobs in the banking industry by 2019. The hyper-low interest rate environment of the past decade has pushed banks’ margins to exceptionally tight levels, and given their largest spending categories, so are the employees. No wonder they’re looking for ways to cut those costs.
Before the pandemic, many companies were already using digital applications that offered some degree of automation and basic data analysis, from customer relationship management to automated human resources to accounting processes. Automation can dramatically reduce the cost and time spent on repetitive tasks, allowing a company to focus more on revenue generation and growth. Companies like Salesforce.com (CRM), Working day (WDAY), Splunk (SPLK), and Limp (JOB) have been helping their customers with many such functions for years, but companies today go far beyond the traditional level of automation.
Process automation has helped many companies not only to survive but, in some cases, also succeed in pandemic lockdowns. For example, if eating indoors was restricted or prohibited, restaurants could take advantage of process automation made possible by solutions such as: Ubers (ABOVE) UberEats, DoorDash (LINE), and GrubHub (RODEN) continue to serve their customers.
The pandemic accelerated the shift towards a higher level of automation. According to consulting firm McKinsey & Co, automation will displace an additional 8.4 million workers in the US by 2030, a 23% increase over the pre-pandemic scenario. The report found that jobs most likely to be replaced by automation are in sales, office support, and grocery and customer service. According to a current one World Economic Forum report80% of executives are accelerating the automation of their services in response to the pandemic. 43% expect new technologies to reduce their workforce.
Not only did the pandemic accelerate the adoption of many technologies, such as automation, but it also affected the way in which these new tools were used. With all the pressures the pandemic has brought, companies have had to adapt faster than ever to survive.
The next phase of automation will be driven by artificial intelligence (AI) and machine learning, which will enable machines to solve problems and take actions that were previously only possible with human participation. These tools can process immense amounts of data, identify patterns, predict future behavior, may recognize images better than highly skilled people, and enable systems to make complex decisions. These systems can continuously learn and adapt, much like we do, but without coffee breaks, vacation and sick days, and requests for a raise.
Those leading the AI indictment are: Nvidia (NVDA), The company is building an AI laboratory in Cambridge, England, which is expected to have an AI supercomputer installed. The company’s graphics processors will also be used to “Leonardo“Salesforce is the fastest AI supercomputer in the world. While Salesforce has long been into the business automation game, I don’t think it’s tired. The company was, in fact, one of the earliest adopters of AI after it launched its AI brought the market. ” Tool, Einstein, September 2016. This technology uses data collected with every user action to create predictive analyzes and solve routing problems.
Another company making waves in corporate AI is DocuSign (DOCUMENTARY). In 2020, the company acquired Seal Software, an AI company focused on contract analysis to revolutionize contracts. The company’s use of natural language processing and machine learning to identify potential risks in a contract and reduce the time it takes to close deals.
A relatively new market entrant on the public stage is Robotic Process Automation, which was founded in 2005 and has just announced one confidential filing for an IPO The company offers technology that emulates the actions of a person interacting with a digital system to carry out a business process. The automated solution can then “trigger responses and communicate with other systems to perform a variety of repetitive tasks. Only much better: an RPA software robot never sleeps and makes no mistakes.” Examples of companies using RPA solutions for their HR, finance and payroll systems include Walgreens Boots Alliance, Coca-Cola and Siemens. The reasons for their use lie in processing repetitive data, processing transactions, and automating certain tasks.
One of the next waves of automation is being driven by the Internet of Things, which combines sensors, networks and software to operate machines, improve quality control, reduce analysis errors and increase safety.
The bottom line is that where businesses can cut costs and improve performance, especially when it comes to repetitive or relatively predictable processes, technology is likely to replace people. This means that there are likely to be big changes in the workforce in the future if the workforce needs to be retooled, but also opportunities as the more nerve-wracking tasks will be taken over by bots doing exactly that type of job. The future could be a lot more efficient and a little more fun.
The views and opinions expressed are those of the author and do not necessarily reflect those of Nasdaq, Inc.