It was only 13 years after Alexander Graham Bell invented the telephone that the first “girl-less” telephone exchange was put into service in LaPorte, Indiana in 1889. All of the world’s systems of connecting calls were built around Bell’s network, to which he owned the patent until 1894.
The day the patent expired, independent companies pounced on the market and introduced a series of competing services. This provided consumers with choice, and further technological advances in automation, which also drove prices down. But then a strange thing happened. Bell’s company bought up these rivals and started to replace automated dialing systems with human operators once again.
Despite pressure from customers, he maintained his stance for as long as he could.
Bell was opposed to the technology simply because he, and no-one else from his company, had invented it themselves. It was unfamiliar, it was a new idea backed by bankers who knew nothing about phones, and it didn’t feel comfortable to him.
When John J Carty, AT&T’s chief engineer took to the floor at the Second Conference of European Telegraph and Telephone Administration Technicians in Paris, in 1914, things changed again. He laid out the case of semi-automation, where the work-load of the operator could be lessened by allowing them to press buttons and not manually connect lines. In his view there was no need for the customer to be burdened with complicated dialing devices (ie, pressing any buttons themselves).
Europe was split, and different countries took different routes. But Britain adopted the fully automated Strowger system in 1912 and never looked back.
Over the years, and around the world, there have been vociferous protests both for, and against the automation of phone dialing; the latter in the US were violently in opposition to the removal of humans in the process.
History has seen similar movements with the Luddites in the industrial revolution, and in opposition to replacing blue-collar jobs across from the spectrum from lamplighters, to blacksmiths.
Today, there is a recently opened hotel in Japan staffed entirely by robots. And if you wonder if people are still protesting, just ask anyone who uses Southern Rail.
And things could get worse: guard-less trains will inevitably become driver-less trains in the future.
There’s little doubt that transactional work in accountancy is going the same route, and has been for some time. Cloud-based financial software packages like Xero (with over a million customers across 180 countries) builds, sends, and chases invoices for users. Software can now guess how to code expenditure, send tax and payroll returns directly to the Government, and automatically read receipts from mobile phone pictures.
On a larger scale, there is a movement across large businesses to fully automate their shared-service centres, one function at a time. This started when processes were packaged and shipped offshore as clearly definable manual tasks run by unskilled low-cost workers. The logical next step is replace these with even lower cost computers, not people.
This leaves the big question of just how much in-depth analysis the ‘human’ can add in more senior roles. It’s a widely held view that expert accountants will always be needed in both commercial positions, which assess multiple competing factors with the intention of providing decision support for business leaders, and technical positions, which do the same but by assessing accounting standards, and applying these to highly complex real-life business scenarios.
But is this the case?
Right now, if you’re looking for your next ‘expert accountant’ job, you’ll search job boards using AI, you’ll be discovered online by algorithms, you’ll deal with agencies who place you into advanced recruiting systems, you’ll sit online tests to automatically assess your personality and cognitive abilities, and your references will be sought through specialist software.
How comfortable are we with our idea that human influence in accounting is essential, whilst simultaneously blindly relying on automation and AI in so many other parts of our lives – even to get that job in the first place?
In the near future we can learn a lot from Carty’s notion of semi-automation. As accountants, we need to master the tools which are there to help us do our jobs better. We need to stay abreast of change, be part of the progress, and not shy away from adopting technology which may one day replace parts of what we do.
There will always be accountants, but what we’ll do in 10 or 50 years’ time is anyone’s guess.
Alexander Graham Bell’s opposition to automation was based on unfamiliarity with new processes introduced by start-ups, backed by bankers, and which threatened to change the industry forever.