A recent article in Chief Executive magazine reports that companies are expecting a 10% productivity gain from advances in automation. You can read the article here.
The forecast is a bit less spectacular once you read past the headline. The 10% gain is across three years, so roughly 3% per year. That is still better than the 0.7% in 2015 and the forecast (The Conference Board) negative productivity growth in 2016 – yikes!
Productivity growth is important, as it provides the basis for economic gains and resulting personal income. How that personal income growth is shared is an issue separate from productivity growth (but also very important).
Is automation really a magic productivity bullet? The Wiremold experience suggests a more productive path. During Art Byrne’s ten-year tenure as CEO the company experienced 14% per year productivity growth. It wasn’t automation that made that happen – it was Byrne’s capacity as CEO and a Lean zealot to personally fuse Lean practices throughout the enterprise. Personally! Lean was not a delegated task.
Automation or Lean? One more consideration: If you automate a non-productive process, have your really increased productivity. Automation can of course complement Lean processes – and Lean enterprises make good use of automation. They focus on developing the shared capabilities of the people working in the enterprise first, their processes second, and automation (at best) third.
