Published on the 19/09/2017 | Written by Jonathan Cotton

76 percent of Australian CEOs say they plan to cut staff numbers this year owing, at least in part, to automation…

That’s according to PWC’s recently released 2017 CEO Survey.

With an estimated 45 percent of work activities ripe for automation – and potential savings of $2 trillion globally by doing so – CEOs are paying new attention to the makeup (and head count) of their workforces.

PwC finds Australian CEOs enthusiastic about the potential of new technology to replace a lot of low-value, repetitive work and reshape the workforce but struggling to understand exactly what that impact – on culture, people and training – will be.

“CEOs will need to figure out very clearly how and where value gets created in their organisation’s human system and act on that.”

Seven out of ten Australian CEOs say they are rethinking their approach to HR as robotics and artificial intelligence increasingly impact the workplace, with three-quarters of CEOs globally believing technology will cause job losses over the next five years.

“Twenty years ago, there were fewer than 700,00 industrial robots worldwide; today there are 1.8 million, and the number is expected to soar to 2.6 million in another two years.”

“The role of the CEO is to not see this as a threat, but recognise the window of opportunity to rethink and redesign the way they employ, manage and interact with people. Can a CEO see the chance to make HR a point of competitive advantage?”

In the face of an increasingly tech-focused workplace, the report suggests that CEOs need to figure out “how and where value gets created” in their organisation’s “human system”.

“Increasingly, it’s the application of the so-called ‘human skills’, things that can’t be automated or done by robots such as adaptability, emotional intelligence and creativity, which generate value.”

The report says the collision of new technologies – specifically mobile, cloud tech and AI – is creating radical new opportunities, but also a healthy degree of anxiety among business leaders.

“In today’s ‘Experience Economy’ the bar is set by the Amazon experience, the Facebook experience, the hotel experience. To remain relevant for customers, the bar has risen. The ability to understand and deliver value to your customers – at speed – is the new battleground.”

Encouragingly, customer experience is being seen as the top business priority, with 79 percent of CEO concerned about changing customer behaviours, and 77 percent saying they are taking a customer-centric approach to R&D.

“This challenge for Australian CEOs is to bring tangible value to the customer by innovating the core. This requires not just customer experience to be a priority, it also requires mastery of the customer. How do we embrace ‘Cloud + Mobile + AI’ to reimagine the experience that was designed last century.”

“There is no sense innovating on the edges if the core customer experience doesn’t keep pace.”

The survey finds almost two-thirds of Australia’s CEOs – up from 57 percent last year – concerned about the lack of trust in business. (That perception seems accurate: the most recent Edelman Trust Barometer says that trust in business, government, NGOs and media – all four key institutions – is in fact in decline).

The reasons? Breaches of data privacy, cyber security, social media and IT outages are key contributing factors.

Over the past few decades, globalisation and technology have been pursued [for] economic gain,” suggests the report.

“In the process, human connectivity has been lost.”

“In the context of an increasingly digital world, 68 percent of Australia’s CEOs (more than the global average of 58 percent) strongly agree that it’s more important than ever to have a strong corporate purpose that’s reflected in the company’s values, culture and behaviours. And over half agree that businesses should be run in a way that accounts for wider stakeholder expectations.”

It’s not all bad however, suggests the survey. With the right approach, there’s opportunity.

“CEOs that embrace the challenge to restore trust – not just with their customers, but also their employees and the wider public – may well find a point of sustainable competitive advantage. ”

The takeaway? For business leader, middle manager and person on the shop floor alike, the time to start preparing for the automated future is now.

Writing of the survey (and those like it) on LinkedIn, Jon Williams, PwC partner put it like this:

“[H]ow many jobs are replaced or significantly altered and whether a machine triggers nuclear strikes are events out of the control of all but a relative few. Instead we should focus on what we, as individuals, can do. “Learn some new skills, STEM ones if that interests you, others if it doesn’t. Reflect on the human attributes that define you, that are your strengths. Try to imagine a possible future where you genuinely use those strengths every day.”

The good advice didn’t end there: “Research not how the machines can replace you but how you can instead use them, to do more. And encourage those around you to do the same.”

At this juncture, that sounds like as good advice as any.

Read the PWC CEO Survey 2017.