The AI Threat: Just How Real is it?
Not a week seems to go by without some headline-grabbing news about artificial intelligence (AI) and automation. Many are scared that automation will take their jobs – indeed, recent figures suggest that some
4 million contracting roles could be lost to automation.
Admittedly, for some roles, the roll-out of automation will be bad news but for others, there are many benefits. Overall, the World Economic Forum predicts that there will be a net increase in the number of jobs. It foresees
75 million jobs across all industries being displaced by 2022, but 133 million new jobs will be created because of automation.
Could it be that the potential threat of AI to contract management is a bit more bittersweet than the headlines would have you believe?
There are several factors to consider when looking at the impact of AI on the sector. Currently, legacy systems and attitudes are stifling AI’s adoption and any pros or cons stemming from it. AI requires a lot of data in a useable format to work efficiently – and many organisations simply don’t have suitable quantities of clean data to use. Before implementing AI and automation, organisations have to get their data governance and management in order – and that takes time.
Legacy systems stalling progress
Additional human roles will be created through automation. Additional roles created Nine in 10 employers actually increased their headcount because of automation, in roles which only exist because of automation. 16 per cent of companies have expanded their IT teams, for example, to help systems run smoothly. Within contract management, manually intensive work such as tagging documents can be done through automation, leaving human employees to focus on negotiation, support, management and strategy. These are generally the more interesting aspects of the job, so a degree of automation should be welcomed by contract managers.
That said, some positions will be completely automated and former workers in those roles will be forced to re-skill. Lifelong learning will be crucial in the future, with people unsure which roles will be automated next.
To futureproof themselves, contract managers must focus on honing their Reskilling becomes commonplace human skills such as communication, empathy and critical thinking. How to achieve that is still largely unanswered. There’s been a boom in online learning platforms in recent years, or alternatively people may turn to short courses, distance learning or formal academia.
The disruption caused to individuals who are automated out of a job cannot be underestimated. There’s the stress of losing a position – which some people may have worked in for a long time – couple with the pressure to retrain and possibly finance that training. Workers in low-skilled positions are most at risk of automation and will be most impacted by the financial strain of job losses and reskilling. They may not be able to afford to switch careers and learn new skills. Some antagonism towards automation and AI should be anticipated from those who have lost their jobs to it and organisations.
The responsibility for retraining and moving redundant workers is still under discussion. Organisations that lay-off significant numbers may find themselves responsible to find alternate roles or training for those individuals, if not legally, then under a duty-of-care to employees.
Governments may be forced to step in when mass redundancies hit a sector, to prevent widespread unemployment and the knock-on economic effects. Alternatively, the onus may fall to each worker, which offers an unwelcome financial burden. It may also increase inequality, as those in low-paying, highly ‘codifiable’ jobs won’t have the means to rapidly reskill and find new careers. Some may fail to find a new role completely, pressuring governments to improve social protection measures. Responsibility a grey area Universal Basic Income may become a necessity.
The perks of automation cannot be overlooked; there are cost-efficiencies and productivity improvements involved in automating manual tasks. Beyond this, contract management processes are being improved with greater visibility. AI can automatically classify contracts and tag documents, making them available to relevant parties. It can flag key dates and highlight any compliance issues.
Then there are the benefits to employees; they will be free of excessive admin tasks. Because processes are more efficient, they can get more work done in a shorter timeframe. Job satisfaction may improve, especially if they can work on more negotiation or strategic tasks. That said, greater productivity may lead to shorter working weeks – with possible pay cuts as a result.
The benefits of automation
Automation is not a clear-cut benefit, nor is it completely a risk. But it’s coming for every industry and most roles. Dealing with automation is likely going to may your job easier, but if it’s too effective then you’ll likely lose that role. For some, this provides a great opportunity to reskill in different areas, expand their careers and enjoy the streamlined effects of automation. Others may not be so lucky. It’s vital that as we embrace automation, we do not overlook those who’ll be negatively impacted. Weighing up automation