Daily Archives: June 21, 2017

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AI, Automation, and Tech Jobs

There are some things that machines are simply better at doing than humans, but humans still have plenty going for them. Here's a look at how the two are going to work in concert to deliver a more powerful future for IT, and the human race.

The emergence of technology such as robotic process automation (RPA) doesn't necessarily lead to the loss of jobs, but to the elimination of certain tasks. What human workers do as automated programs take over some of these tasks might be largely up to them.

"Not every employee will adapt and innovate, but we believe most will," said Stanton Jones, director and principal analyst at technology research and advisory firm ISG. "Those that do adapt will go in two directions: one group will focus on becoming more productive by doing more of the same kind of work they did in the past with the assistance of digital labor. The other will move on to more value-added activities."

ISG is primarily seeing a focus on productivity improvements. But as companies get more comfortable with "digital labor," they will start to rethink their operating model.

With the assistance of digital labor that is constantly improving with each subsequent customer interaction, customer-focused employees such as those in call centers will be freed up to proactively reach out to clients when problems occur, or to prevent them in the first place, Jones said.

For example, in a telecommunications call center, an employee that typically handled incoming complaints can proactively reach out to a customer that dropped a call and offer them a discount for that month. Or, a help desk employee can proactively reach out to an executive letting him know that his hard drive is about to fail.

"In each of these cases, the human employee is improving their interaction with the customer because the virtual agent is improving as well," Jones said.

A number of organizations are starting to build automation centers of excellence, Jones said. "These are small teams that use agile approaches to identify, build, and implement automation throughout the company," he said.

Very few companies are focused on automating jobs. "Instead, they are focused on automating tasks and improving productivity," Jones said.

History shows that as automation increases, things get cheaper, and as things get cheaper, more people buy them, Jones said. "We believe the same thing will happen as automation and AI (artificial intelligence) moves into the enterprise. The products and services these companies create will, for the most part, become cheaper because the cost of the delivering them is going down."

Will some IT and business support employees lose their job due to automation? "Yes, but we believe this will be limited for now," Jones said. "The key is that over the long term, there will less routine jobs available."

A majority of IT and business leaders have indicated to ISG that avoiding long-term costs is an important outcome of automation and AI. "So while automation will reduce unit costs, and therefore create more buying opportunity for end customers, it will also mean that people that are focused on routine work will find less and less of those types of jobs available to them over time," Jones said.

IT is likely to be the corporate support function that will be most impacted by automation and AI.

"But this also creates opportunity," Jones said. "IT is in by far the best position to drive automation and AI into the firm. IT has the best experience with agile development and systems integration, and almost always has the best view into how business processes use technology. So, as long as the entry-level job is focused on agile, process design, change management, data science, or software engineering -- in support of the further automation of tasks within the firm -- it's a great place to be."

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Automation will take over IT tasks, not jobs | ZDNet - ZDNet

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Marketers: Check Out These Hot New Trends In B2B Marketing ... - Forbes

As US president Trump has made bringing jobs back to America a rallying cry, others have pointed out that even the factories that stay are, thanks to automation technology, getting more work done with fewer people.

According to a new survey, the same is happening with factories in China, a major outsourcing partner for US manufacturing companies.

The Wuhan University study, according to the South China Morning Post, followed 11,300 employees and their 1,200 employers in the provinces of Guangdong and Hubei for two years. It found that labor shortages were among manufacturers biggest concerns and that 40% of manufacturers in those provinces have introduced automation technology.

Average manufacturing wages throughout China, although they are still much lower than in the United States, have been rising steadily for more than a decade, and, according to the survey, worker turnover in Guangdong and Hubei is high. About 25% of workers in the study transferred jobs in 2015 and 2016. With high worker turnover, they have to pay workers more to retain them, Albert Park, a professor at Hong Kong University of Science and Technology and a co-designer of the survey, told the Post.

One reaction to rising wages in some areas of China has been for manufacturers to shift work toward poorer places, where wages can differ greatly, or out of the country entirely. Cities meanwhile use tax breaks and subsidies to keep factories competitive: About half of the companies in the Wuhan University study had accepted such aid. And, as in the US, more expensive labor makes automation more attractive. In 2015, according to the International Federation of Robotics, factories in China bought 68,000 industrial robots, 20% more than the year before, and more than all European countries combined.

The choice between outsourcing and automation, in other words, isnt necessarily a binary one.

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It's not just the US: Chinese factories are turning to automation as wages rise - Quartz

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Israels labor force is undergoing a modernization process with fewer workers at risk of losing their jobs due to automation, according to a study by the Taub Center For Social Policy Studies in Israel.

The study examined the dangers posed by automation to the workforce as the nation moves from a traditional economy driven by manufacturing and production to an information technology and services economy, where high-tech and services are the major growth engines.

As a result of the market increasingly demanding high-skilled workers, the share of those whose jobs are highly vulnerable to automation went down between 2013 and 2015, the period covered by the study. However, this is less true for Arab Israelis and immigrants than for the native-born Jewish working population.

The study finds that the relative portion of workers in low-risk occupations has risen, while the share of workers in high-risk occupations has declined evidence of a continued labor force modernization process, the Taub Center said in a statement.

The findings of the study come as policy makers and business leaders in Israel convened for two days in Jerusalem, on Monday and Tuesday, to discuss the challenges automation poses to Israels labor market.

The former president of Intel in Israel, Mooly Eden, warned on Monday that the government was not doing enough to deal with the blow being inflicted on the labor market by automation.

Thanks to the likes of autonomous cars, chatbots and digital banking, he sees tens of thousands of people unemployed, he said. We can prepare for this, he said. But in my opinion we are completely unprepared.

The Taub study, by Prof. Claude Berrebi and Kyrill Shraberman, shows that changes among women were greater than among men with a significant drop in women employed in clerical work, indicating that these positions might have already undergone a process of automation as bank branches close, secretarial services become outsourced and offices computerize administrative tasks.

In the Arab Israeli sector the study shows a decline in the share of skilled workers in production and manufacturing considered at high risk from automation and a relatively strong rise in their share in sales and service as well as clerical work.

Women working in a matza factory (photo credit: Tsafrir Abayov/Flash90)

There was just a small change an increase of 1% in the share of Arab Israeli workers in occupations requiring an academic education. This is low relative to the Jewish population, which posted an increase of 1.9%. As a result, the average salary rise among Arab Israelis is also lower.

A possible reason for this is the relatively low skill level within the Arab Israeli sector: the share of those with high-level skills in reading comprehension and mathematics among Arab Israelis aged 16-64 is only 1%, versus 10-13% among the Jewish population, according to the OECDs PIAAC survey of adult competencies.

Among Jewish immigrants, there has been a rise in the share of unskilled workers and a smaller increase in the share of workers in academic professions, relative to long-time residents or the native-born. An exceptional rise in the share of unskilled workers (like cleaning and security workers) is seen among men ages 45-54 who came to Israel between 1990 and 1995. According to the researchers, the data point to the difficulties of integration among this adult male immigrant group who have been in Israel over a decade and have experienced difficulties adjusting to the modern labor market.

The major impediment to immigrant integration in the labor market is language issues Hebrew and sometimes English. Immigrants in general, and female immigrants in particular, are characterized by higher rates of academic education that do not match the local labor market. Thus, they often compromise by accepting employment in occupations that do not require an academic education. That said, immigrants are employed at slightly higher rates than Jewish long-time residents/native-born Israelis.

The study also examined to what degree a year of formal education improves hourly average salary, and found that since 2003 there has been an overall rise in return on education. This return encourages workers to get more education, and thus improves the quality and the skill level of the labor force.

But this rise also contributes to increasing wage gaps between workers. In 2014, the hourly salary for men with 18 years of schooling, equivalent to a masters degree, was 35% higher than for those with 12 years of schooling equivalent to a high school diploma.

This gap was higher for women at 41%. But for Arab men the return on education declined between 2011 and 2014, as the rise in wages over those years for Arab Israeli men was more moderate than among the general male population. Among immigrant men, there was also a rise in return on education, although the gaps remained lower than among the general male population, the study showed. Wage gaps between immigrants with 18 years of schooling and those 12 years of schooling were 22% in 2014.

The Taub Center for Social Policy Studies in Israel is an independent, nonpartisan socioeconomic research institute.

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Israeli workers get more skilled as automation looms, study says - The Times of Israel

The latest edition of MarTech Todays B2B Marketing Automation Platforms: A Marketers Guide examines the market for B2B marketing automation software platforms and the considerations involved in implementing this software into your business.

This 44-page report is your source for the latest trends, opportunities and challenges facing the market for B2B marketing automation software tools as seen by industry leaders, vendors and their customers.

Included in the report are profiles of 14 leading B2B marketing automation vendors, pricing charts, capabilities comparisons and recommended steps for evaluating and purchasing.

If you are a B2B marketer looking to adopt a marketing automation software platform, this report will help you through the decision-making process. Visit Digital Marketing Depot to download B2B Marketing Automation Platforms: A Marketers Guide.

The 14 vendors profiled in this report represent some of the choices available for B2B marketing automation platforms; they are not a comprehensive list of B2B marketing automation vendors. This report is not a recommendation of any marketing automation platform or company, and is not meant to be an endorsement of any particular product, service or vendor.

This report was prepared by conducting in-depth interviews with leading vendors and industry experts in December 2016 and January 2017. These, in addition to third-party research, form the basis for this report.

This research report is sponsored by Salesforce, Marketo, IBM and Salesfusion.

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Report: 14 marketing automation vendors profiled updated for 2017 - MarTech Today

Rockwell Automation Inc. (ROK - Free Report) , a leading global provider of industrial automation power, control, and information solutions scaled a 52-week high of $165.39 yesterday, closing at $164.06. This was backed by increased investment, acquisitions and focus on long-term goals.

Rockwell Automation has a healthy year-to-date return of 23.3% and a solid one-year return of 43.1%. The company displays long-term earnings growth rate of 10.63%, making us confident of its innate strength.

Despite crafting a 52-week high, the price of the company has underperformed the Zacks Categorized Industrial Automation/Robotics sector over the last 12 months. The current rate of return for the industry is 43.5%, while that of Rockwell Automation is 39.9%.

The stock has a market cap of $21.1 billion. Average volume of shares traded over the last three months was approximately 951K. Over the last 60 days, the Zacks Consensus Estimate for Rockwell Automation moved up 5.7% to $6.64 for 2017. We note that the company has beaten the Zacks Consensus Estimate in each of the trailing four quarters, the average positive earnings surprise being 9.89%.

Growth Catalysts

Rockwell Automations new Connected Enterprise (CE) integrated supply chain management system will prove conducive to growth. The company is increasing the number of industries, applications and geographies, as well as improving its investments to expand the value of CE. With average profitability well above the corporate average, CE sales will be an integral part of Rockwells incremental growth and boost margins over the next few years.

Notably, the company acquired Automation Control Products in Sep 2016 to help customers enhance global competitiveness through CE. Further, the MagneMotion acquisition adds to its portfolio of innovative motion control solutions for consumer and transportation verticals. Finally, MAVERICK Technologies buyout has boosted expertise in chemical, consumer, life sciences, along with oil and gas industry applications.

In addition, Rockwell Automation continues to target long-term revenue growth of 68%. The company also maintains its objective of delivering double-digit EPS growth, return on invested capital (ROIC) of more than 20% over the long term, and cash flow of around 100% of adjusted income. These long-term goals will be supported by Rockwell Automations strategy of diversifying its sales streams by expanding products portfolio, solutions and services, and global presence.

The company is also aimed at achieving growth rates in excess of the automation market, by expanding its served market, strengthening competitive differentiation, and serving a wider range of industries and applications. Rockwell Automations objectives also include market share growth by gaining customers, capturing a larger share of existing customer spending, as well as improving quality and customer experience.

Zacks Rank & Other Key Picks

Rockwell Automation currently carries a Zacks Rank #2 (Buy).

Other top-ranked stocks in the same sector are iRobot Corporation (IRBT - Free Report) , Altra Industrial Motion Corp. (AIMC - Free Report) and Parker-Hannifin Corporation (PH - Free Report) . All three stocks boast a Zacks Rank #1 (Strong Buy). You can see the complete list of todays Zacks #1 Rank stocks here.

iRobot Corporation has an average positive earnings surprise of 61.72% for the trailing four quarters. Altra Industrial Motion generated an average positive earnings surprise of 15.93% over the past four quarters, while Parker-Hannifin has an average positive earnings surprise of 14.94% for the last four quarters.

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