Balancing human and digital labor

It's the dawn of a new era of artificial intelligence — an era where AI has enabled capabilities we never thought likely.

The possibilities for AI are exponential, spawning a major dilemma for many business leaders. Just because an activity or job can be automated, should it be? And if so, what are the ethical implications of automation for a company, its customers and its employees?

This requires business leaders to take a deep dive into their company's core values to answer key questions, which are explored in a new KPMG report titled "An Ethical Compass in the Automation Age." The report discusses how organizations should align their goals, culture and core values when considering implementation, also emphasizing the importance of considering nonfinancial costs.

First, let's define what technologies we're talking about. Robotic process automation (RPA) and cognitive automation, which include AI, combined with analytics and the human enterprise, create what many define as digital labor.

Digital labor is already transforming the workplace. Advanced software that can mimic many human functions — including reasoning and learning — and can now automate 45 percent of what Americans now do at work. If used strategically, cognitive automation can augment human workers' brain power.

However, it's not the first time companies have enjoyed significant advances while also wrestling with them. Some of the key questions that businesses are now being forced to grapple with are:

• If we can automate processes, should we?

• Will the outcomes be friendly to humans, the communities in which we do business and the environment?

At KPMG, we are making some of the same tough decisions that our clients are making — decisions that could disrupt at least one-third of our business. For example, KPMG is automating critical parts of our audit process so clients receive more thorough and accurate services than humans could ever provide. Our goal is to provide higher quality audits to help restore faith in the capital market. At least one-third of our business can be disrupted by these technologies — to the benefit of organizations worldwide.

Following are some examples of how KPMG has used AI to help clients integrate people and technology, leveraging disruptive cognitive technologies for competitive advantage. We have helped:

• A retail giant scale automation within the context of their culture.

• A global insurance company develop a solid intelligent automation road map that included automating core business processes.

• Quickly leverage intelligent automation technology to support a financial services firm's new product launch.

Within the last century, advances in technology have eliminated entire industries while creating new ones, often displacing workers but also offering vast new opportunities to others. The key is in how companies use these new technologies and how they approach the ethical dilemmas.

Following are nine steps to help companies monitor their ethical compass:

1. Hold ethics discussions. Have frank conversations within your company about the potential impact of each decision to automate.

2. Update core values. Make tough decisions about intelligent automation that will force companies to re-examine their core values. That could mean fundamental changes in how the business operates.

4. Embed core values in the technology. AI and data can potentially have biases that can contradict your core values and beliefs.

For example, a bank's loan system could misunderstand accents or dialects and deny loans.

5. Establish an ethics committee. Knowing the complexity of intelligent automation, many companies establish an ethics committee or board that typically includes outside experts.

6. Track the impact of automation. Many organizations create a "center of excellence" to manage governance. Others establish programs for employees to learn how to work with new technologies.

7. Participate in forums. Become a member of organizations that strive to make sure AI benefits society as a whole.

9. Update cybersecurity. New safeguards will be needed to prevent hackers from teaching your cognitive technology to commit fraud, mislead and steal. AI can also be programmed to detect and deter such threats.

Experts are divided on whether AI will ultimately benefit society — or end up destroying it. Business leaders need to understand the crucial role they will play in making sure that AI is used the right way.