Spurred by the impact of Covid-19, companies, large and small, have embraced the necessity of redesigning and automating work processes to remain competitive. Advances in intelligent systems with the ability to think, learn, and work alongside humans enable lower costs, higher quality, and faster cycle times than previously possible.
More companies are pursuing automation in an accelerated fashion as they try to cope with the pandemic costs. Many, to their surprise, find that labor costs increase since automation requires “someone to install it, someone to operate it, and someone to maintain it.”
Automation tends to advance not by eliminating jobs but by eliminating particular job functions at which humans are inefficient or inconsistent or exposed to risk.
The Elephant in the Room
Automation changes the nature and composition of a workforce. Computers – operated by knowledgeable and skilled workers – perform some functions in new work environments, while humans perform others. According to a survey of 300 executives at companies with more than $100 million in revenues, retraining and reskilling is a prerequisite for successful automation.
Companies pursuing automation have learned, sometimes painfully, that before employees can work effectively with automation technologies, they must be taught how to do so. A 2020 McKinsey Global Survey found that 87% of executives report current or expected gaps in workforce skills and leaders necessary to transition to an automated workforce easily or quickly.
The most prominent challenge organizations face implementing automation projects is human resistance, i.e., the process changes raise the specter of lost jobs and status. Automation changes the capabilities required to perform jobs, and it changes the nature of the work employees are currently executing. Results are more than a skills challenge, but a job challenge. McKinsey estimated in 2019 that 375 million global workers would be required to change jobs or update skills by 2030.
Since implementing automation typically creates jobs and modifies existing processes, companies must determine what skills will be needed in the new work environment and promote a continuous learning culture if the organization is to meet automation goals. Organizations often find that external assistance is necessary to complete automation projects due to a lack of internal resources or skills. A 2018 survey by ISG Research of 549 European business leaders found that a majority engaged external consultants to help make strategic decisions in the change and business-readiness elements of automation.
The Automation Process
Resisting the call to automate a company’s processes has become impossible for most corporate executives. Automation benefits are no longer questioned. From Inc. to Harvard Business Review, popular business periodicals have joined international consulting firms like Deloitte and Accenture to extol its advantages. Company executives who fail to act quickly will find themselves behind the competitive eight-ball, possibly ending in their firm’s disappearance. PwC warns that digital transformation occurs rapidly across industries and questions the directors about their oversight of the operations where they sit on boards.
Company executives, willing and unwilling, forced to accept the new paradigm, have little experience or knowledge of how to proceed. The stakes are high, especially when information about the method, scope, and cost remain unsettled. Decisions are further complicated when a project spans multiple functions and departments must resolve complicated control, communication, and coordination issues.
A decision to automate leads to more questions:
- Which projects have strategic priorities?
- Do internal resources have the capacity and capability to implement automation projects successfully?
- How does the company overcome expected employee resistance to change?
HotPMO working with your Project Management Office (PMO)
A business at its basic level is the continuous, simultaneous, and successful completion of multiple value streams, processes, sub-processes, and tasks to achieve specific objectives. Organizations that already recognize the value of an Enterprise PMO understand that the project management office can be a vital piece of the organizational jigsaw, enabling planning, organizing, leading, and controlling many of the processes that ensure the maximum efficiency and effectiveness, each function being critical to the automation of processes. There are few other areas of the business that are so well placed to view processes that cut across organizational silos and influence process improvement.
When processes are clearly defined, and procedures are codified, the next step to gaining efficiencies must be to automate. Often this last step is never achieved. Many PMOs still hold true to the origins of the PMO where they were a temporary team supporting a single project. Such PMOs were disbanded when the projects they completed were delivered. It is perhaps due to this history, that automation can still rely on tactical approaches such as Excel macros residing on a single PMO Analyst’s PC.
Automation will eliminate or change 61% of U.S. jobs by 2030, according to the Brookings Institute, and we predict that the PMO and suitably skilled PMO people will be at the heart of such transformations. Despite the availability of those who might lose their jobs, the National Academies of Science, Engineering, and Medicine (NASEM) forecasts that the number of skilled technical workers will be insufficient to meet demand, given the present conditions. More than three-quarters of executives responding to a McKinsey survey in 2018 considered the skills gap a major priority for their company, with most accepting a responsibility to reskill and retrain their workers. As teams with a passion for processes that accelerate delivery and enable decision making, the organizational PMO is an obvious place to start, whilst extending into other business support functions such as Finance and HR, for whom the implementation of automation efforts often presents enormously time-intensive, complicated, and stressful tasks for HR practitioners.
Unfortunately, many business support functions and PMOs not equipped to reskill and retrain employees whose jobs are changed by automation. HotPMO can assist automation efforts on many levels and be a knowledgeable sounding board for executive decisions. Our assistance is especially useful in the following tasks:
One rule of automation (and IT projects generally) is that poorly thought-out projects rarely go smoothly. Among considerations for the priority of projects are
- Can the process be eliminated? Rather than re-engineer or automate, elimination is less expensive.
- Is human intervention required? Processes that require direct, variable inputs from humans are hardest to automate and may require limiting those who communicate with the program.
- What is the degree of variability of inputs and outputs? Processes with high degrees of variability can be more time-consuming and expensive.
- Can an upstream process be redesigned to simplify or eliminate work? If the upstream processes or outputs are overly complex or complicated, a better solution may redesign that process.
- What level of expertise is needed to automate the process? Tools such as Robotic Process Automatic (RPA) may allow lesser experienced programmers to perform the automation.
- Is the required capacity and capability in-house? Many organizations have the technical expertise to complete automation projects but are unavailable due to other priorities. Conversely, some have available resources who lack the appropriate skills.
- Do the expected benefits justify the cost of automation? Few things are as frustrating as completing a project which fails to have the expected impact on costs, quality, or cycle time.
Our team of PMO professionals, RPA consultants, and Business Analysts can identify and deconstruct processes, collect information, and analyze costs and consequences. Generally, operations with the most menial and repetitive tasks will deliver the most benefit for the cost, or those intended to replace the most expensive manual tasks, have higher ranks in the order of implementation.
Robert Bolton, a London-based KPMG Partner, notes that HR professionals are typically compartmentalized with someone looking at talent, another at performance, and another at rewards. In many companies, no one has the necessary skills to deal with the changes that automation forces on an organization.
Developing the appropriate messaging for an upcoming project is critical for acceptance. A crucial part of automation planning is considering the impacts on humans, according to Chris Streit, senior director at HR consultancy Korn Ferry. “Sometimes, employers only look at potential output and how many staff they can eliminate.” They often do not consider the employees who will need to stay and work with the new technologies.
Employee resistance to automation is regularly confronted and overcome by our change specialists. Having “been there, done that” – the result of multiple automation projects – learning the benefits, pitfalls, and outcomes of each – enhances the consultant’s credibility in crafting the right message.
The expertise of an experienced PMO can benefit multiple elements of an organization contemplating automation. In addition to helping executives to understand and prioritize automation projects, HotPMO can assist with
- Staff Training. Many organizations struggle with the best ways to accomplish retraining and upskilling. The PMO can “train the trainers,” leveraging its contribution to an organization while giving HR departments breathing space to get up to speed with their new responsibilities.
- Automation Assistance. Corporate IT departments necessarily focus on the operation and maintenance of existing systems. The expectation that IT can maintain existing service while creating a new technical environment, i.e., “delivering more for less” is rarely possible. Few companies are willing to finance excess technological capacity for the single possibility it may be needed. HotPMO can bridge the gap between limited internal expertise or workforce and the skills required to automate successfully.
- Use of Robotic Process Automation. Robotic Process Automation (RPA)is the preferred method to automate human workers’ manual, repetitive tasks. RPA is also non-intrusive, meaning it does not alter existing systems or infrastructure. The tool can be used to extract and combine data from multiple systems, such as PPM software, finance systems, and Excel sheets, and display the results through various user interfaces (UI) and APIs through systems like Microsoft PowerSuite and UiPath. RPA has a projected growth from $250 million in 2016 to $2.9 billion in 2021.
Human societies and interactions are undergoing fundamental changes once thought to be forever in the world of science fiction. Whether shopping for a product or searching for references in a school project, robots’ presence in daily life will be ubiquitous. Many see the expansion of intelligent systems as a boon for humanity – the end of dreary, monotonous, dangerous physical labor – potentially creating a world where violence, disease, and want are relics of the past. Others are uncertain, worried that the evolution of artificial intelligence might go too far.
Whatever the future or the period over which the automation transformation will occur, one thing seems inevitable: Organizations that fail to become more agile competitors in the post-Covid market are likely to become also-rans. Automation of work is no longer a futurist’s dream, but a fact. Organizations can choose to sit on the sidelines, risking their existence, or accept the new reality and start building an automation capability that best fits their circumstances.