Sunday 25 September 2016

Almost half of Irish firms turning to automation to streamline business

Paul O'Donoghue

Published 14/08/2015 | 02:30

One in four Irish firms expects to have fewer staff after automation
One in four Irish firms expects to have fewer staff after automation

Almost half of Irish businesses have either automated some of their business functions or intend to do so over the next year, according to new research.

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The Grant Thornton International Business Report also found that the rate of automation in Ireland, at 48pc, was slightly behind the global average of 55pc.

The international survey of almost 2,600 senior executives, such as chairmen and managing directors, was conducted during February.

A further 24pc of Irish businesses said they may automate processes in the next 12 months. 28pc of companies said they had no intention of automating processes for the next year.

The reasons most commonly cited by businesses who chose to automate practices was that they were looking for greater accuracy and efficiency in production and enhanced flexibility to increase or decrease production.

Many workers often associate automation with a loss of jobs, which proved true for one in four Irish companies who said that they would expect a reduction in headcount following increased automation.

However, the study also found that 58pc of Irish businesses that have automated functions expect to redeploy workers in other areas. Globally, 43pc of manufacturing firms said they expect automation to eventually replace at least 5pc of their workforce.

At the other end of the spectrum, just 9pc of hospitality, education and healthcare firms expect 5pc or more of workers to be replaced.

Fergus Condon, a partner at Grant Thornton said: "Firms are continuing to strive for greater efficiency and better productivity. With costs of capital low and labour costs increasing, as businesses consider whether to invest in staff or machines, for many, the latter is becoming the more cost-effective option."

He added that although labour forces are generally resilient and adaptable, "the rise of technology [and] analytics pose significant opportunities and challenges.

"No sector or profession is immune. While some job losses will occur as technological advances increasingly transform both the private and the public sector, technology will increase both the quality and quantity of our efforts."

The study also showed that companies are spending more on research and development compared to previous years, although they still lag behind their international counterparts.

In 2011 19pc of Irish businesses said they were planning to boost R&D spending, a figure which rose 23pc in 2014. However this is still behind the global figure of 28pc.

Irish Independent

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