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The robotics revolution: Will it eat its children?
Once upon a time a group of consultants came up with a whizz-bang idea. “Let’s help cut clients’ procurement costs,” they said, ricocheting off the walls of their meeting room in an excitable fashion. Over the years that followed they criss-crossed the world doing just that: replacing distributed, uncontrolled purchasing with formal, centralised processes that scrutinised, then slashed, hundreds of millions of dollars of expenditure. Happy, even smug, the consultants retired to their luxury penthouses delighted to have added value in such a concrete, measurable fashion. So imagine their surprise when they found themselves some years later subject to these same controls. Go through procurement? Eugh! E-auctions? Eek! Meanwhile the new breed of chief procurement officers rubbed their bureaucratic hands with glee: yet more savings for the corporate coffers.
Today, there’s a real buzz around robotics—and rightly so. After decades in which the key way for organisations to cut costs has been to offshore routine processes to low-cost locations, organisations have found that rising labour rates and the problems of managing quality remotely have come back to haunt them. Robotics (which, for convenience, we’ll define here as a way to automate repetitive and often rules-based processes, typically performed in a back-office function) offers an alternative: more controllable quality at a vastly lower price. For some people, this is just the next, logical step in the evolution of information technology; for others, it’s a quantum shift: new technology, more data, and clever algorithms open up the possibility to automate higher-level, knowledge-based processes as never before.
Not surprisingly, consulting firms see this as a huge opportunity. Alongside digital transformation, it’s potentially a consulting opportunity on the scale of enterprise resource planning and the original wave of offshoring. But will the revolution turn on its creators?
The fact that consulting is a people business has always been the industry’s strength and difference. But the downside to that has been a resistance to automation (indeed, one source of abiding fascination to me is that consulting firms, making so much money from advising clients about technology, are rarely leading-edge when it comes to managing their own—cobblers’ children and all that). Such backwardness has been justified on the grounds that consulting work is not a “repetitive and rules-based” process, but that argument is under attack from the very robotics consultants are recommending to their clients, as well as from clients who want lower fee rates and—gosh! more controllable and consistent delivery.
Consulting firms will find the promise of robotics too great to resist. The short- and even medium-term fees to be won from doing this kind of work already means that the marketing machine is revving its engine. But longer-term, the greatest impact will undoubtedly be on consulting itself.