Automation, AI, machine learning and robotics has brought with it the dawn of the fourth industrial revolution. A recent Capgemini report suggests there is a costly risk to the way enterprise organisations respond to the subsequent need for digital transformation.
Organisations, especially those in the manufacturing sector, are gearing towards automation – applying the newest technology to increase productivity and enhance the customer journey.
Applying the right technology to legacy processes may seem like the right way forward. But if you don’t give equal focus to upskilling the people that execute these processes, your organisation is only fixing half of the problem.
One study from Capgemini claims organisations that combine “high automation maturity” with “advanced upskilling programs” save up to $270 million more than those who neglect to upskill their people.
“Too many big companies are lagging in developing training programs and not realizing full productivity benefits as a result,” says Claudia Crummenerl, Managing Director, People and Organisation practice at Capgemini Invent.
“There is no question that automation will transform the workforce and existing job roles, but the crucial factor is that companies make faster progress to prepare themselves, and their employees, to realise the benefits of automation.”
What’s the current scenario?
The risk of failing to upskill and properly prepare your workforce for the new industrial age is by no means a theoretical threat.
According to a report from McKinsey Global Institute, 62% of executives believe they will need to retrain or replace more than a quarter of their workforce between now and 2023 due to advancing automation and digitisation.
The threat looms larger in the United States and Europe (64% and 70% respectively) than in the rest of the world (only 55%) — and it is felt especially among the biggest companies. In fact, 70% of executives at companies with more than $500 million in annual revenues see technological disruption over the next five years affecting more than a quarter of their workers.
Finding the way forward
Much of the narrative surrounding automation so far has been about “replacing” humans. However, those benefiting the most from the shift understand humans and technology will depend on one another to succeed. This is less about job risks, and more about the impact of automation on skills and learning.
Andrew Murphy, CIO at UK retail giant, John Lewis Partnership said: “It has never been an acceptable outcome for us to simply displace human labour in favour of technology. Our strategy has been to not just save money, but also to follow a sustainable employment model in the face of the inevitability of significant digitalisation of the workplace.”
Also keeping upskilling at the heart of their employees’ learning and development is AT&T, the world’s largest telecommunications company. The telco set itself a target of investing $1 billion to reskill nearly half of its workforce – 100,000 employees globally – for new jobs by 2020.
So what’s the solution?
However, for most organisations, upskilling is remains an afterthought – with 60% of HR and general management executives admitting the impact of automation on the workforce is not a key consideration in their leadership’s automation vision and strategy.
In order to take upskilling seriously, organisations must understand the future demand for these skills – particularly digital.
It’s important to create a program that is seen as relevant and exciting to make an impact among staff. For example, AT&T launched its upskilling program to equip workers whose skills were in danger of becoming outdated with new skills to perform new types of jobs. One of their network reliability engineers earned a master’s degree in computer science by taking up an online program developed by the Georgia Institute of Technology in partnership with AT&T. The employee gained qualifications – and the organisation benefited from a new skill set without having to make the original role redundant.
This is also a great example of how, on the surface, certain blue collar jobs may seem redundant – but automation can lead to large scale job growth, particularly for employees trained in data and analytics. By proactively growing the skill sets of your existing employees through online training and certifications, you can position your business for continued success.
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