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article imageHow should organizations be adapting to automation?

By Lisa Cumming     May 24, 2018 in Technology
The question of how companies should plan on adapting to automation is weighing on many. A new report from McKinsey that focuses on how organizations (not just industry) are thinking about automation and how they should be adapting.
"To harness the new technologies to their full effect, companies will need to retool their corporate structures and their approaches to work. That change will require redesigned business processes and a new focus on the talent they have—and the talent they need." — from the McKinsey report
The data
Working from data they collected during a survey on automation, McKinsey found that 77 per cent of respondents (averaged from limited and extensive adopters of automation) said they "expect no net change in the size of their workforces in either Europe or the United States as a result of adopting automation and AI technologies." The thinking goes that there will be no net change because while certain jobs shrink as a result of automation, others will expand and this will happen to maintain no net job loss. About six per cent of respondents (averaged) said that they expect a decline in the size of their workforce in the same markets.
READ MORE: Automation impacting the future workforce
What it means
In their report, McKinsey says that their findings suggest that organizations will need to change in five areas: "mind-set, organizational setup, work-activity allocation, workforce composition, and C-suite and HR understanding and functions."
To break down what this means:
  • Mind set change: Companies need to provide continuous learning opportunities and ensure that they're promoting lifelong learning within their organization.
  • Organizational setup: Moving away from traditional hierarchies and incorporating more "cross-functional collaboration" between teams — this also goes back to the mind set change, McKinney stresses the importance of keeping people learning and evolving in their skill sets.
  • Work-activity allocation: McKinney explains the concept of "unbundling and rebundling" to create jobs that look different than they have in the past.
  • Workforce composition: Plain and simple, more work will be done by freelancers and contractors as per the gig economy dictates — companies need to get used to this.
  • C-suite and HR understanding and functions: In the survey, 19 per cent of responders said "top executives lacked sufficient understanding of technologies to lead the organization through the adoption of automation and AI," in addition to getting execs on board, HR will also need to change to accommodate the new workforce.
Not just an industrial debate
The question of 'what are we going to do when automation comes' has caught the attention of White House hopefuls like Andrew Yang, a US Presidential candidate for 2020.
Yang advocates for Universal Basic Income which, he says, will help American workers who've been displaced by automation transition through this period.
More about Automation, Workforce, Future, mckinsey
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