Know when it is time to automate processes and when it is necessary to hire people. Introducing automation to work processes can help save time, optimise workflows and cut costs when it works well. Knowing when and where to automate is the key to maximising the benefits of automation.
Automation has been labelled as the fourth industrial revolution. The range of jobs and services that can be automated grows ever more prominent. This is impacting how employers weigh up the costs of human labour vs automation. Automation often brings to mind machines that can be programmed to perform tasks faster and more accurately than humans without the need to take breaks, sleep, or go on holiday. However, the answer as to whether you should use automation or human workers is not as clear-cut as this. There are many other variables to be considered, which this article will explore.
What can and should be automated
When deciding whether to hire a person to do work or invest in methods to automate the job instead, an employer needs to consider what they want and what is possible. Automation should not be viewed as a silver bullet that can fix all issues; it is not a blanket replacement for human workers. There are strengths and weaknesses to automation that need to be understood. Still, when applied appropriately, automation enables faster, smoother, and more consistent processing of menial tasks, allowing human workers to instead focus on more exciting and less repetitive work.
Tasks best suited to automation include those that are repetitive and involve relatively consistent inputs and outputs. For example, a financial analyst tracks the stock market and makes trades by observing financial charts and data patterns. Consuming and analyzing data to make trades on the stock market is an excellent example of a task well-suited to automation.
In particular, the power of machine learning has made automatic trading so popular that studies have shown that as little as 10% of trading volume now comes from human discretionary investors. Models and algorithms can be developed and then applied to the real world to execute trades and take advantage of moment-to-moment price movements far quicker than is possible for humans. These algorithms can be run across different markets to cover trading hours for exchanges all around the world consistently. This type of application is a perfect candidate for automation.
What cannot and should not be automated
It’s important to understand that we are very much living in the age of automation. It means that while things are changing rapidly, we are still not at a point where everything can be automated or that it is desirable to do so in all situations.
Algorithmic trading may be a good candidate for automation, but it is not without its limitations. Algorithms can only respond to expected inputs and apply previously acquired knowledge to them. The job of a finance officer, for example, involves more than simply tallying figures. There is a human element to work that cannot be understated. Automated processes cannot meet clients, factor in variables they have not been programmed to consider, and be limited in their range of possible outputs.
In general, jobs can be automated for certain processes, but not for entire tasks. Automation should be considered as an augmentation of existing work processes rather than a replacement of human workers. It’s particularly good at the tedious, highly repetitive, but necessary tasks that often lead to burnout in human workers. Number crunching and data analysis can be done quicker and faster by machines. The purpose of the output will influence whether a process should be fully automated or not.
Hiring automation experts
Automating business processes is often overlooked by companies because they need to hire workers continuously to integrate and maintain these automated processes. In the example of finance, many companies will have dedicated teams of programmers, developers, and general IT experts on hand to monitor trading algorithms and make sure nothing goes wrong.
Automated processes excel at following well-defined procedures through the use of platforms like Power Automate and Zapier. Deep learning and neural networks allow machines to adapt to changing data by modifying their algorithms. However, even the tiniest error or mistake in these processes can have costly consequences. In one particularly egregious example, one company lost $500m in half an hour due to a bug in their algorithmic trading software, causing it to make trades they didn’t intend for it to complete.
It highlights the need for human minders to watch over these algorithms and automated processes. Despite the mistakes being caught relatively quickly, the company nevertheless incurred significant financial losses since the algorithms operate at such high speeds and frequencies. In situations like these, algorithms generally cannot detect when they have gone wrong, and, in worst-case scenarios, they can deplete company funds in a matter of minutes if there is no way to detect or correct erroneous behavior.
In order to achieve maximum results from automation, it is important to understand fully both its advantages and limitations. It will be specific to the processes you wish to automate, but generally, automated processes should have some level of human oversight to catch the obvious errors and mistakes to human workers but to which computerised processes are oblivious.
While machine learning algorithms can adapt, these processes typically involve repeated exposure to novel input changes based on feedback over time. Humans are still significantly more flexible and adaptive when compared to automated processes in the event of sudden changes in data.
Weighing up the costs
Automation is a tool that companies and employers can use to enhance their existing processes. Much like the industrial revolution of Victorian Britain, it enabled companies to produce more goods, hastened the speed of production, and opened the doors to entirely new industries. What it did not do is completely replace the need for human workers. Instead, specific processes were given over to machines, and human labour was shifted elsewhere.
The automation revolution is shaping up to have much the same effects. When considering whether to automate or hire people for a job, you should weigh the strengths and weaknesses of both options before making a decision. Very often, a hybrid solution is presently the best answer, with tedious and repetitive tasks handed over for automation, while human workers are left to handle the bits they do best — creativity, ingenuity, and the ability to adapt.
