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Rise of the machine: How automation is redefining work and real estate

Global /

Automation is here to stay. The rise of the machine has proved a constant since the Industrial Revolution. However, acceleration in the pace of change today is primarily down to digitization, the 21st-century’s phenomenon.

It is hard to believe Apple first launched the iPhone only 10 years ago, but digital mobile devices now proliferate in our personal lives and the technology is fast becoming ubiquitous. Much of the associated smart and intelligent infrastructure being developed is built upon an emerging ecosystem of sensors, with connectivity creeping up on society, as if by stealth.

The Internet of Things (IoT) is effectively already here, with Gartner estimating 5.5 million new things got connected every day last year. The forecast date for the landmark total of one trillion sensors active worldwide has now been brought forward from 2030 to 2025. To put that number in perspective, this will mean over 120 sensors for every human on the planet.

This connectivity boom underpins surging automation and the change is already being felt both at home—with the likes of Amazon and Google launching smart assistants based on artificial intelligence (AI)—and on the street, with ‘driverless’ cars no longer considered to be a part of science fiction. Automation is here, and it is revolutionizing the way we do things. Likewise, this also means that the roles, business processes and corporate real estate (CRE) need within your organization will be redefined.

Unsurprisingly, intelligent automation—the combination of artificial intelligence and automation—is one of the top 10 global trends identified by JLL for CRE in 2017. Furthermore, some other trends in the same research also appear to be directly interrelated. For example, Algorithmic business will increase the incorporation of advanced analytics and AI.

Automation in the working environment

The board room is already alive to the automation trend: according to KPMG, 85 percent of CEOs are considering the integration of automated processes over the next three years. At the same time, Infosys estimates 3 out of 4 (76%) senior decision-makers see AI as fundamental to strategic success. While rising automation appears inevitable, its precise effect on jobs is less than certain.

The question is not whether the job market will be transformed by automation, but rather how. Robotics and automation are already taking over responsibility for repetitive and risky manual tasks, driving performance, efficiency and safety. Some of these are described as the ‘3D – dull, dirty and dangerous’ jobs, potentially demeaning to human workers.

In many cases, though, job replacement is expected to be more partial than complete—boosting productivity and simultaneously freeing people up to undertake more creative and strategic tasks, so enhancing job satisfaction and workplace wellbeing.

However, the trend is agreed upon, its numbers are disputed. By 2019, PwC predicts 25 percent of tasks across every job category will be automated. The Oxford Martin School goes so far as to suggest almost half of jobs done today in the US alone (47%) could potentially be automated over the next two decades. Forecasts for fully automated jobs, though, typically fall into single figures, with the World Economic Forum predicting some 60 percent of jobs have scope for at least 30 percent automation.

Instances of job losses through automation in industrial and manufacturing sectors are making the news. The recent story of a factory in China replacing 90 percent of workers with robots and seeing a 250 percent leap in productivity is typical. However, white-collar roles in financial markets are also facing the

However, white-collar roles in financial markets are also facing the axe. Wall Street firms have been busy automating, steadily replacing human traders with algorithms and cutting around 1 in 3 jobs between 2000 and 2013, despite transaction volumes going up. A major Dutch bank is replacing nearly 6,000 people with machines, in a move costing $2 billion, but saving $1 billion a year.

The organization reorganized

For CRE, the real revolution in automation is in the utilization of the workspace.

Automating repetitive, simple tasks in business processes will help increase speed, precision and cost efficiency. From a real estate perspective, this means reorganizing your organization. The work that companies do and the way they do it is changing. As the more process-driven elements of work fall into artificial intelligence, the use of freelancers, consultants and contingent workers sourced via virtual marketplaces is becoming increasingly common too. This means that the companies of the future will be leaner and more dispersed allowing their employees to focus more narrowly on value creation.

Therefore, developing talent strategies to attract and retain the right kinds of employees is essential. There are two generations of talent that firms particularly need to get to grips with to successfully navigate the changes taking place: digital natives and digital dependents. These groups have the digital skills and understanding of technology that companies need to transform their businesses.

Which are the landmark properties maximizing opportunities afforded by intelligent automation? They include Intel’s new IoT-driven development in Israel, involving facial-recognition software and machine learning; and, the real-time occupancy tracking and open-plan vertical-city versatility of Majunga Tower, Paris.

Automation is even affecting life for us here at JLL, following our global agreement with Leverton to automate lease management. Machine and deep learning technology mean clients benefit from optimized data management, reduced operational risk and a more robust audit trail.

Should we be worried? Not yet, but almost no sector can remain immune to the rise of the machine. For CRE, the clever play is to work with automation, not against it.

Interested to find out more about Future of Work? Learn more about our outlook on the changing world of work here.

Interested to learn more about the technological trends and its impacts on the workplace? Read this report.