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COVID-19 Has Accelerated the Timeline to Automated Economies

By Dr. Gary L. Deel, Ph.D., J.D.
Faculty Director, School of Business, American Public University

In a previous series, I wrote how technology and automation are slowly revolutionizing modern economies, either by replacing human beings when machines can do the job better, faster, and cheaper, or by augmenting human beings so that more work can be accomplished with fewer people.

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The purpose of that series was to emphasize how this transition poses a serious threat to the ability of humans to earn a living in first-world economies. There’s no reason to think that slide toward automation will stop or regress. The only question is how fast this shift will occur.

Historically, this movement toward automation was motivated primarily by the aim of businesses to make their operations more efficient and profitable. But every new change comes with its share of hiccups and problems, so many businesses moved slowly and cautiously with new technological deployments. They wanted to make sure the rollouts did not negatively impact customer experiences.

After all, they still had their employees whom they could count on to do the jobs reliably — though less efficiently perhaps than machines. So they took their time. This is why big retail stores did not quickly replace their cashiers with automated checkout kiosks.

The Global COVID-19 Pandemic Shut Down Businesses around the World

But 2020 has changed all that. In the blink of an eye, a global pandemic shut down businesses around the world, from movie theaters to theme parks to cruise lines and shopping malls. And suddenly, the security blanket of traditional employees was no longer any comfort as they became part of the very problem that led to the need for shutdowns in the first place.

So as a byproduct of the coronavirus and its effect on the global economy, many business leaders are thinking hard about how they can automate their operations in ways that minimize the need for human-to-human contact. So when the next pandemic comes along, they need not suffer from forced closures. And this will undoubtedly accelerate the transition to automation.

We will see a rapid push to self-service technologies throughout our economies where they are viable. Retail, food, travel, leisure — anywhere we can afford to remove humans as a biological risk to others, we most assuredly will.

Benefits of Automated Technologies

Above and beyond the efficiency and profitability gains from such technologies that I discussed in my series, we now must add two more apparent benefits for businesses that adopt them.

First, businesses might have an easier time justifying continued operations during a future pandemic. If a company can show that customers need not interact with any company personnel to purchase their products or services, this will eliminate a critical point of potential disease transmission.

Certainly, social distancing measures and frequent cleaning and sanitation would still be needed to prevent customer-to-customer transmissions. So if restaurants and stores remained open during a pandemic, they would still need to regularly and thoroughly disinfect their customer environments to avoid exposure. But this could hypothetically be done by a few employees in full protective gear.

This is what is currently happening in self-service checkout areas at Walmart, Target, Home Depot and other “essential service” businesses that have remained open. Between each customer, an employee in a mask and gloves thoroughly wipes down the machines. So the risk of exposure is minimized.

The second benefit to automation technology in the post-coronavirus era is that employers won’t risk legal liability from employees’ exposure to risk of infection. Businesses in all industries are nervously awaiting and contemplating the right time to reopen their doors.

For example,  Universal Studios reopened its Orlando parks in June. But in July, in the midst of a resurgence of pandemic cases, it laid off a number of employees across various departments, including its parks and resort division. Disney executives said Walt Disney World in Florida could reopen safely, The New York Times reported, “even as coronavirus cases in Florida surge to alarming levels.”

Two of its four major parks, the Magic Kingdom and the Animal Kingdom, opened on Saturday to a limited number of visitors, with some attractions and wandering character interactions unavailable as safety precautions. Epcot and Disney’s Hollywood Studios were set to reopen on Wednesday. Florida officials on Monday reported 12,624 new infections, “one of the largest daily jumps in the state since the pandemic began.”

The cruise lines are still unsure of scheduling. And most have pushed their next sailings back to September.

COVID-19 Legal Claims Have Begun to Appear

The key risk of opening too early is that, if someone, a customer or employee, contracts COVID-19 while on your property due to your haste or lack of care, you could be liable for negligence in a court of law. And given that the coronavirus has taken so many lives, this risk is severe; so much so that businesses are lobbying Congress for immunity from coronavirus-related legal claims.

Whether or not the government will grant such immunity from COVID-19 lawsuits is yet to be seen. But every employee whom a company can replace with technology is one fewer employee the company will potentially have to send to work in a future pandemic. That is also one fewer source of liability for them.

Other Industries Have Changed Their Business Models

Aside from these changes to traditional customer-interface environments, even more drastic changes may be just around the corner for some other industries. For example, movie theaters are obviously difficult to operate safely during a major disease outbreak. Consequently, streaming services such as Netflix, Hulu, Amazon Prime Video and Disney Plus have seen a spike in popularity during the coronavirus pandemic.

Some motion pictures that were slated to hit theaters during the last few months are being shown on premium pay-per-view TV channels. This new business model — allowing consumers to watch newly released blockbuster movies from the comfort of their own home — may someday replace movie theaters altogether.

The Future of Automation in the Business World During and After COVID-19

There’s no doubt that these are unprecedented times. As such, it’s hard to predict with any degree of certainty what the future holds. Many people are hopeful that this COVID-19 pandemic is a one-time crisis. But medical experts are forecasting that this could become a seasonal pandemic, at least until an effective vaccine is developed.

With that in mind, we should be prepared for a worst-case scenario, for businesses will likely have to modernize their operations through automation in a way that eliminates or ameliorates the economic risk associated with such events. Survival of the fittest in this case will mean survival of the least people-dependent organizations.

About the Author

Dr. Gary Deel is a Faculty Director with the School of Business at American Public University. He holds a J.D. in Law and a Ph.D. in Hospitality/Business Management. Gary teaches human resources and employment law classes for American Public University, the University of Central Florida, Colorado State University and others.

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