Covid-19, demographic shifts to drive automation

Businesses will need to shore up their productivity through technology and automation to cope with the pandemic and a shrinking workforce, says an industry expert

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The confluence of the Covid-19 pandemic and demographic shifts in the years to come will drive the demand for automation, according to an industry expert at a business advisory firm.

Speaking at a virtual event organised by UiPath, Bernard Salt, managing director at The Demographics Group, said businesses in countries such as Australia and Japan with shrinking workforces will have to improve their productivity through technology and automation.

In Australia, for example, the annual growth of the working age population over the past 60 years has hovered around 150,000. This figure is expected to decline to about 100,000 from 2020 onwards as baby boomers start to retire faster than the rate at which millennials are entering the workforce.

The situation is worse in Japan, where the working population has been in decline since 1995, Salt said, citing figures from the United Nations Population Division. This has spearheaded the adoption of automation in the country which has led the world in embracing automation, he added.

Against this backdrop, Salt – recognised as one of Australia’s leading social commentators – called for workers to be adaptable amid the gloomy economic outlook, which he likened to a meteorite that landed on Earth, forcing all business life forms to adapt to new ways of working.

“Many businesses have been pretty good in responding to that, and part of that story is automation,” said Salt. “But there’s something else that’s hard to do, that is, to remain positive and optimistic, so we can create a better version of the economy going forward.”

On industries that will play an important role in economic recovery, Salt pointed to those that have done well amid the pandemic. These include logistics, transportation, distribution, warehousing and fulfilment which have boomed as more people shopped online.

Multimedia managers

In the technology sector, Salt said multimedia managers and website developers will be sought after, citing figures from the Australian Bureau of Statistics which revealed a 200% increase in demand for those jobs between February and March 2020.

“Technology that enables businesses to go online was in demand – and an extension of that is the role of automation to make businesses more efficient by taking out the boring bits of jobs,” said Salt, adding that this will enable people to become more creative and entrepreneurial.

Automation can also help organisations reduce risks. Paul Loke, CIO at the Singapore government’s Accountant General Department, said: “Automation is one of those things that provides very standard processes that can potentially reduce the risks to your organisation.”

As an example, he said a neighbourhood cupcake shop can reduce the risks of having inconsistencies in cupcakes made manually by people.

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“Automation delivers the same consistency and it’s scalable because you can deploy an unlimited number of machines to make cupcakes, as compared to human hands where you will have people suffering from fatigue,” he said. 

Notwithstanding, automation projects, particularly those that involve robotic process automation (RPA), often have problems scaling up across an organisation. To succeed, business groups and IT will need to work hand in hand to drive the automation agenda, said Shaun Ryan, a partner at PricewaterhouseCoopers.

“Automation is often not strategically positioned well in an organisation,” said Ryan. “The business often starts an automation journey through a PoC [proof-of-concept] or a short-term tactical solution, and CIOs often view these as high-risk, substandard approaches that add technical depth.

“Solving how you’re going to deal with this and making sure it doesn’t happen again is important to improve the dynamic between business and IT.”

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