This trend that is much fabled and talked about in the business world and is causing much commotion is automation.
To many people, automation is the shift from using a more labor-intensive capital to a more technology-intensive capital, where, in a sense, many humans are replaced by robots to perform business tasks, or as Bainbridge puts it, “the use of computers or machines to perform work originally done by humans.”
Some benefits of automation come more straightforwardly, where “on the one hand, advances in information technology facilitate business process automation to increase efficiency. While there might be efficiency in terms of the business process through automation, the use of automation is highly regarded when it comes to decreasing the overall cost of business processes, a concept that is highly related to automation.
In research that was conducted by German researchers Katzmarzik, Henneberger, and Buhl on the interferences between automation and business processes, it was deduced that “automation should be a substitute for unprofitable manual work, whereas the marginal rate of substitution increased with higher effective labor costs.” (Katzmarzik, Henneberger, & Buhl, November 2012).
This information further gives us insights into how the favored view that automation is often put under the spotlight since having a fully functional system that runs through automation might not be able to bring forth the most optimal business performance, which thus constitutes a challenge to finding the perfect point between succeeding and having the best outcome and reducing the costs related to business operations as much as possible.
The good news is that jobs that require empathy, communication skills, and close personal interaction are here to stay for now, and half of today’s work activities might not be automated until 2055.