Combating The Labor Shortage With Automation

The gender pay gap is not the only chasm that exists in most countries. The divide between baby boomers and Generations X, Y, and Z could seriously threaten the financial performance of companies if they do not take action now. On each side of this divide we find some very different attitudes and expectations when it comes to work culture, work-life balance, digitalization, and career paths.

On one side, there is the 17-year-old digital native who seems to spend eight hours a day on TikTok, Snapchat, and Instagram and who wants to start a career, ideally in the commercial department and preferably in your company. However, if your company still does things the old way, with manila envelopes, stamps, and paper trays, it is unlikely to be a match made in heaven. Admittedly, few companies are quite so analog these days, and SAP or other ERP systems have become the norm. But if your IT department thinks that Fiori is a kind of ice cream rather than an innovative system for designing intuitive user interfaces, your new hire is unlikely to feel at home.

Transformations in the job market

ERP user interfaces that are ten years older than the new recruits who use them will fail to impress. Such new recruits will become even more critical in the coming years, when the entire baby-boomer generation is set to retire. In Germany, for example, in 1965, 1,325,386 babies were born, around twice as many as in 2005, when there were only 686,000 births. Most Western countries have a similar age structure.

As a result, demand for qualified young personnel now massively exceeds supply, leading to dramatic transformations in the job market — an imbalance that will only grow over the next few years. Career starters will be picky about where they work, especially if they are well educated. And they will not want to join companies where work processes are monotonous, manual, and old-fashioned.

To find qualified staff to fill administrative roles, companies will need to have more to offer than the clichéd foosball tables, baskets of fruit in the morning, and latte macchiatos made of hand-roasted kopi luwak beans from a fully automatic coffee machine. These perks are all well and good, but they are not enough. What really matters is the daily work culture, and this is reflected in the tools staff are expected to work with.

What tools would a digital native want to work with?

It is worth taking a closer look: How are processes designed, how user-friendly are the tools? Would a digital native want to work with them? It is important to try to see things from this perspective, rather than sticking with the way things have always been done. Companies with a high degree of automation enable their staff to focus on more meaningful activities. At the same time, automation can at least somewhat compensate for staff shortages. Furthermore, intuitive, user-friendly software and simplified processes will be loved by new hires and long-standing employees alike.

However, digitalization projects should not be imposed top-down by the IT department. This is an approach that has caused many IT projects to fail. Instead, future users at all levels should be involved from an early stage as part of a strong feedback culture. Only employees who feel appreciated and know that their own needs and ideas will be incorporated into the future working environment will be motivated. And this applies to everyone, whether they are boomers or members of Generation X, Y, or Z.