The Impact of Computerization and Digitization on the Workforce

Computerization and Digitization are disrupting many industries with an immense impact, especially on the workforce. These disruptive technologies are introducing new dimensions in already-developed industries including manufacturing, insurance, healthcare, financial services, agriculture, public sector, and even the food industry!

How far can we go with technologies through computerization and automation? Can robots, for instance, cook and service food? Yes! In Kunshan, China, the robot restaurant has a staff of robots that cook and serve its guests. The robot staff operates through tracks on the floor, which lead from the kitchen outward to the aisles where they then pause to serve the tables.

This is happening in China, which has one of the largest labor forces in history! One could argue markets such as India and China have plenty of “cheap” labor; therefore technologies that automate work (including BPM or workflow and also robotics in service sectors) will not be suitable or successful in these countries. The Return on Investment and Total Cost of Ownership analyses that calculate cost savings due to technology often do not justify the investment in digital automation technologies – at least on the surface. The argument is that since manual labor is much more affordable, especially in poorer countries, automated work is not in demand nor desired. That premise and assumption is flawed on a number of fronts. Automated machines and software can learn much faster and better than humans. As digital automation becomes more affordable, it could potentially justify the ROI. For repeatable tasks (and increasingly even for complex ones requiring creative thinking), digital automation will eventually outperform their human counterparts. Furthermore, the very large amounts of Big Data can be quickly analyzed and operationalized by self-driving cars, auto-piloted airplanes, or robots serving in a restaurant. More importantly, the innovative force of technology is unstoppable; it challenges our assumptions. This emotional appeal of cutting-edge or “latest and greatest” technology should not be underestimated. As a marketer of Apple once said – and I paraphrase: “They (the consumer) don’t really need it (i.e. the latest and greatest iPhone or iPad) … but they gotta have it!”

During the industrial revolution, many jobs were lost. New jobs were created. When it comes to work, we are in the midst of the second digital technology revolution with huge impacts on many industries. We touched upon the food industry. Another sector that showed serious erosion of labor, especially within the US, is manufacturing. As summarized in the Industrial Internet : “U.S. manufacturing productivity grew by 69% in real terms between 1977 and 2011 in part because machines automated many low-level human tasks.”

It appears we are being seriously challenged by the very technologies and machines that we are creating. Sounds like a nightmarish science fiction movie. As noted in The Second Machine Age, “In any sensible economic system, people should focus on the tasks and jobs where they have a comparative advantage over computers, leaving computers the work for which they are better suited.” Computers, especially software, are getting better and better in just about anything.

But there is a silver lining – and a huge one. Digital technologies can in fact assist workers and make them even more viable in the labor market. McKinsey released a paper titled “The Future of Work in Advanced Economies,” in which they summarized, “For businesses, the next wave of work redesign has great potential to improve both the efficiency and effectiveness of the most expensive talent in their organizations… For policy makers, the continuing transformation of jobs by technology means that worker skills need to evolve ever more rapidly.” In other words, software and “Things” or devices that assist and guide workers help them become creative and innovative. A relatively recent and comprehensive study on the future of employment in 702 occupations concludes that, “For workers to win the race, however, they will have to acquire creative and social skills.” One of the most important “skills” that all workers need to cultivate is innovation.

Adaptive Digital Enterprises need to manifest a platform that continuously learns, assists, and guides its workers to be more creative and innovative. I mentioned this in a previous blog, “Knowledge Assisted Workers.” I also summarized the top 10 trends for Adaptive Digital Enterprises: Part I and Part II. The very first trend – namely innovation – remains the most important. Leveraging a Build For Change® platform with the associated creativity disciplines, an adaptive digital enterprise can focus on innovation especially within their processes, customer experiences, ideation for new products, and a modernized IT organization.

If you are interested in how to instill these innovative skill sets into your organization, please check out the Innovation Workshop and contact me for further information.