Age of Automation promises big business advantages — if you’re ready

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When it comes to automation, the future is already here. You might already have suspected as much, but a new report from the McKinsey Global Institute confirms it. And, if your company is not ready to capitalize on opportunities to automate — and to integrate automation with existing technology — you stand to lose out on a huge competitive advantage.

The McKinsey report examined labor markets in 46 countries — about 80 percent of the global labor force — and disaggregating occupations into some 2,000 constituent activities. Automation was rated against human performance in 18 ways to determine potential savings in efforts and worker hours.

The result: Nearly half of work activities global have the potential to be automated using current technology. Up to 5 percent of today’s occupations could be entirely automated, and about 60 percent could be automated by at least a third. How much is that worth? If activities that could be automated today were, the savings could approach $15 million, McKinsey estimates, and labor savings are only the start.

As the authors said:

“As we have also documented, automation can not only enable a reduction in labor costs, it can also bring a range of other benefits related to performance improvements, such as greater throughput, improved reliability, raised quality, better safety, and other gains. Straight-through processing of financial transactions, for instance, is usually faster than the manual process it replaces, and reduces the number of errors introduced into the process.”

But here’s the catch, as noted by the seven McKinsey authors: Companies must be ready to adapt quickly if they hope to capitalize.

“Business leaders and their organizations will also need to become more knowledgeable about the evolution of the technologies themselves, understanding the art of the possible, and the potential for the future, in order to best position their enterprises to take advantage of automation. This is not just “book knowledge” that comes from reading about technologies, or visiting global centers of innovation, but practical knowledge that comes from devoting some resources to continually and purposefully experimenting with technologies on real problems, and then scaling those that demonstrate promise.”

McKinsey & Co. graphic

McKinsey & Co. graphic

In other words, the C-suite can have all the good intentions in the world, but if the IT staff isn’t geared up to quickly develop, test and deploy new technology, the result will only be frustration and failure.

This is what software enabling Service Virtualization, Continuous Delivery and test automation is all about: Driving down the costs of new application development while driving up speed and quality so you’ll be ready to ride the technology wave when it arrives.

Competing in today’s application economy — and in the emerging automation economy — requires a development lifecycle that delivers quality software faster than ever before. With an integrated, zero-touch workflow that includes the ability to mimic any dependency, analyze any feedback loop and share data across the enterprise, companies will be in the best position to achieve true competitive advantage.

Studies have already shown that companies with zero-touch workflow can generate twice as many software releases and higher-quality software.

That organizational dexterity will propel those same companies as automation arrives. Once suspects those are likely to be left standing in 20 years, while companies that weren’t prepared to leverage technology fall by the wayside.

 

 

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