Are we ready for robotic automation in Nigeria?

Automation is a topic that has gained global attention for quite some time. This topic and conversations around it births mixed feelings just as the reports are mixed. There are mixed feelings because of the tremendous advantages it offers businesses and the threat it poses to many job holders. The McKinsey report as mentioned by BBC News on 29 November, 2017 states that “up to 800 million global workers will lose their jobs by 2030 and be replaced by robotic automation…” While this might seem alarming, it is not unexpected given the spate of technological advancements and disruptions in contemporary times.

It is crucial to understand that organizations (save not-for-profit organizations) exist to make profit and this requires reducing costs to a manageable minimum while increasing revenue. This is where automation of business functions comes in — it guarantees efficiency and increase in productivity which consequently impacts positively the bottom line. Though neat on paper, some considerations would have to be made as is the case with every business investment. Given a particular job, is robotic automation better than human performance? If it is better, is the timing right? I would offer my opinions on these two questions taking into consideration critical factors in the Nigerian context.

In Nigeria, is robotic automation (artificially intelligent or non-artificially intelligent) better than human performance? It depends. This could be answered from financial and non-financial perspectives. However before I address this question, it is important to mention that robotic automation do not necessarily imply artificial intelligence — not all robots are programmed to carry out robust and complex tasks that mimic human intelligence which is the goal of artificial intelligence. Financially, robotic automation is better if it reduces cost for companies (especially in the long run), it increases productivity (which must be evident in the amount of revenue and profit obtained) as well as if it is affordable. A quick look at the Nigeria business space shows that the bulk of businesses are made up of micro, small and medium enterprises (MSMEs). According to the 2013 report by the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), and the National Bureau of Statistics (NBS), Micro, Small and Medium Enterprises (MSMEs) in Nigeria was 37,067,416 companies and the total number of persons employed by this sector was 59,741,211 which represents 84.02% of the total Nigeria labour force. Interestingly, micro businesses (companies with less than 10 employees and less than N5million in assets excluding land and building) accounted for 36,994,578 of the companies in this sector. Given the structural and economic challenges bedeviling our business context (especially this sector that constitutes the largest share of businesses in Nigeria), is deployment of robots financially feasible and sustainable? Well, organizations will have to engage in financial cost-benefit analyses to adequately make this decision.

From a non-financial perspective, it is paramount to take culture into consideration. Nigerians just like many Africans are by nature (to a large extent) gregarious. This permeates into business transactions as evidenced by informal conversations even within formal organizations…the occasional use of vernacular in transactions et cetera. In a study of B2B and B2C organizations by Uzo and Adigwe (2016), it was evident how cultural norms impact business transactions. This means that in the quest to automate work tasks, Nigerian business owners and foreign firms operating in Nigeria must pay special attention to the cultural dynamics that is an integral part of work life. Consideration must also be given to transactional preference(s) of customers who are embedded in this same cultural context. Are we as a people predisposed to transacting with robots (even those with artificial intelligence algorithms)? This question is connected to the next question.

Is the timing right for robotic automation? This question is asked against the backdrop that automation leads to loss of jobs as well as the creation of new ones. In a country with an unemployment rate of 23.1% as stated by the National Bureau of Statistics (NBS) and reported by The Guardian on 19 December, 2018, one cannot help but ask how prepared is our country for the displacement of workers that will be caused by robotic automation. This question should not be much of a concern to business owners as it should be to the government because the primary focus of organizations would be to minimize cost, improve efficiency and maximize profits. The government would have to contend with an increase in unemployment rate and its attendant problems like crime (which sadly poses a threat to businesses et cetera). With the creation of novel jobs (owing to disruptions by robotic automation) comes another challenge, the need for skill upgrade and dynamism. The Nigeria education system still contends with a few challenges (structural, financial etc) that makes optimum performance impossible and this makes one wonder how realistic it is to achieve skill upgrade and dynamism needed to address the challenges that will be caused by automation in the years to come.