Why CEOs Should Care About Smart Automation

The most recent leap has been in artificial intelligence, where computers are no longer just carrying out tasks for humans, such as fueling self-driving cars, teaching simple duties and describing complex scenes in simple sentences. Now, they are overseeing tasks by other machines.

Robotic process automation (RPA), for instance, can crunch data, process transactions and communicate with other systems to ensure that processes get carried out more quickly and efficiently. With smart machines, which go beyond RPA, it is now even possible to automate the operations of an entire IT stack. This kind of self-learning/self-healing software can solve 90% of all IT tasks, freeing your IT staffers to focus on innovation and technological progress rather than mundane things like trouble tickets.

Once again, RPA is challenging CEOs to reimagine their businesses and creating a new paradigm. The reason: Smart machines have intelligence. They can adapt to a context rather than following a script. They discover new solutions on their own or by working alongside humans as a virtual colleague. Where automation follows a process step by step and the automation designer has to think about a goal, smart automation builds a process to achieve the goal. This is the premise behind RPA and smart machines.

Is your company ready?
Admittedly, some of this sounds a bit scary. In a business sense, what’s really disturbing about smart machines is their potential to utterly disrupt the workplace. If you look at ATMs, they were surely going to take over the jobs of the bank tellers. They didn’t, and instead, increased efficiency and elevated the position of the bank teller.

To be sure, smart automation will impact white-collar jobs. But rather than eliminate positions, it will be freeing up resources and eliminating mundane tasks, increasing efficiencies, lowering risks, helping reduce errors and using your human capital where it is needed most—to grow your business.

The market is ready to realize the cost savings of smart automation and position companies to take advantage of this environment as much as possible and as soon as possible. Here’s what you need to do right now to have the competitive advantage.

1. CEOs should set budget distribution goals with their CTO/CIO aiming at least for 50:50 distribution between a “run the business” and a “change the business” spend in addition to the overall IT budget size.

2. CEOs should set goals for “repurposing” existing tech staff toward changing the business and incorporating technology into the business model. This is their fastest source for tech talent who can hit the ground running. Just imagine if past companies had done this. In particular, Eastman Kodak for a long time was focused on maintaining its once-lucrative hold on celluloid film. The company could have tried to see where the market was going though and built SD drives and photo printers. Ice cube makers, anticipating the creation of the electrical grid, could have made fridges instead. Time magazine could have become Twitter instead of relying so heavily on its fading print business.

3. CEOs should backup their CTOs and CIOs when they shorten the time to production for new concepts. This is the critical driver for competing, but of course shortening this process and shrinking the machine used today bares risk. The best message CEOs can give to their CIO/CTO is that “recovering from mistakes is more important than avoiding them” and measure accordingly. Of course, the biggest mistake a company can make is to refrain from experimenting. Even if a business isn’t ostensibly focused on technology, it’s important to embrace it.

Think for instance, of the taxi industry, which had no reason to fear or integrate technology because it seemingly had a monopoly over its industry. Then along came Uber and decimated the business. The taxi industry thought it could evolve with the market by offering performance vehicles, because customers loved them. The industry didn’t see how a disruptor could come in and lower the price of a ride, utterly changing the rules of the game.

The difference between automation and smart automation may be subtle, but it is growing exponentially. If you don’t start participating in the race, your competitors will, and then no acquisition or marketing strategy will be able to help.