The Vicious Circles of Skill Erosion: A Case Study of Cognitive Automation

2023 | Journal of the Association for Information Systems | Citations: 0

Authors: Rinta-Kahila, Tapani; Penttinen, Esko; Salovaara, Antti; Soliman, Wael; Ruissalo, Joona

Abstract: Cognitive automation powered by advanced intelligent technologies is increasing ... Expand

Abstract: Cognitive automation powered by advanced intelligent technologies is increasingly enabling organizations to automate more of their knowledge work tasks. Although this often offers higher efficiency and lower costs, cognitive automation exacerbates the erosion of human skill and expertise in automated tasks. Accepting the erosion of obsolete skills is necessary to reap the benefits of technology-however, the erosion of essential human expertise is problematic if workers remain accountable for tasks for which they lack sufficient understanding, rendering them incapable of responding if the automation fails. Though the phenomenon is widely acknowledged, the dynamics behind such undesired skill erosion are poorly understood. Thus, taking the perspective of sociotechnical systems, we conducted a case study of an accounting firm that had experienced skill erosion over a number of years due to reliance on their software's automated functions. We synthesized our findings using causal loop modeling based on system dynamics. The resulting dynamic model explains skill erosion via an interplay between humans' automation reliance, complacency, and mindful conduction. It shows how increasing reliance on automation fosters complacency at both individual and organizational levels, weakening workers' mindfulness across three work task facets (activity awareness, competence maintenance, and output assessment), resulting in skill erosion. Such skill erosion may remain obscure, acknowledged by neither workers nor managers. We conclude by discussing the implications for theory and practice and identifying directions for future research.Walter Fernandez was the accepting senior editor. This research article was submitted on August 17, 2021 and underwent three revisions.Tapani Rinta-Kahila is a lecturer of business information systems at The University of Queensland Business School. His research focuses on issues around the implementation and management of artificial intelligence systems in organizations, unintended consequences of IT use, and decommissioning of organizational IT systems. Tapani obtained his doctoral degree from Aalto University School of Business in 2018 with an award-winning dissertation. Rinta-Kahila's research has appeared in top IS journals, including MIS Quarterly, Journal of the Association for Information Systems, European Journal of Information Systems, Information & Management, and MIS Quarterly Executive. His work has also informed practice through industry reports co-authored with The SAP Institute for Digital Government.Esko Penttinen is an associate professor (tenured) of information systems at the Aalto University School of Business. Penttinen holds a DSc in information systems science and an MSc in economics from the Helsinki School of Economics. Penttinen's research helps organizations understand the intricacies related to the design and implementation of various forms of artificial intelligence, harnessing its benefits and avoiding the pitfalls. Penttinen is an avid student of the interplay between humans and machines, curious to generate insights on how to coordinate work tasks efficiently between the two. Penttinen's research has also addressed the more traditional information systems topics such as organizational governance issues related to outsourcing and virtual work. Penttinen's main practical expertise lies in the assimilation and economic implications of interorganizational information systems, focusing on application areas such as electronic financial systems, government reporting, and electronic invoicing. Penttinen's research has appeared in leading IS outlets such as MIS Quarterly, Joona Ruissalo is a doctoral researcher in information systems science at the Aalto University School of Business. His research explores how the design, development, and use of cognitive technologies such as robotic process automation and artificial intelligence transform professional knowledge-intensive work. He currently studies these sociotechnical issues in the domain of financial accounting. Collapse

Topics: accounting mindfulness artificial intelligence knowledge work process automation system

Methods: qualitative interview case study applicability check personal interview triangulation

Theories: sociotechnical systems theory socio technical theory

From Accountant to Software Developer – Transforming Employees with Robotic Process Automation (RPA)

2023 | HICSS | Citations: 0

Authors: Siemon, Dominik; Kedziora, Damian

Abstract: Constantly changing technologies affect not only the value types that companies ... Expand

Abstract: Constantly changing technologies affect not only the value types that companies generate but also their processes and their most important resource: employees. Such transitions referred to as digital transformation, mean that employees must tailor their skills and ways of working to stay considered a long-term asset for their company. Intelligent information systems, such as robotic process automation (RPA), are gradually taking over employees' work efforts, and thus replacing part of the human workforce. In the paper, we investigate whether non-technical employees (in this case, accountants) can be retrained to work as entry-level RPA software developers. In our case study (observations blended with interviews), we show how retraining transforms employees’ identity, addresses their anxiety and skepticism, and impacts the organization. Further, we show the relevance of domain knowledge, digital literacy, and the cornerstones of a training program transforming accountants into RPA developers. Collapse

Topics: systems development video conference artificial intelligence software developer digital literacy

Methods: qualitative interview personal interview synthesis case study qualitative content analysis

CEO Power and Nonconforming Reference Group Selection

2022 | Organization Science | Citations: 0

Authors: Audia, Pino G.; Rousseau, Horacio E.; Brion, Sebastien

Abstract: Research shows that reference group selection underpins critical organizational ... Expand

Abstract: Research shows that reference group selection underpins critical organizational processes, but less is known about publicly disclosed choices of reference groups, such as those for the evaluation of firm performance. Because audiences, such as investors and analysts, prefer reference groups created by independent entities they can trust, they disapprove of choices of custom peer groups created by reporting firms. Nevertheless, firms frequently choose reference groups that do not conform to audiences’ expectations. We seek to explain why firms deviate from these externally held standards even when incurring penalties by developing theory and formulating hypotheses about the influence of chief executive officer (CEO) power. Using data from 10-K filings, we find that firms led by high-power CEOs are more likely to use nonconforming, custom peer groups despite incurring penalties. However, the relationship between CEO power and the use of custom peer groups is weaker when CEOs face greater scrutiny from shareholders and analysts. We also find that low firm performance increases the use of custom peer groups among high-power CEOs. Contrary to our expectations, high CEO compensation attenuates the effect of CEO power on the choice of custom peer groups, arguably because high levels of CEO pay increase scrutiny. Although firms incur costs for using nonconforming reference groups, supplemental analyses reveal that CEOs benefit by receiving higher compensation, especially when performance is low. We conclude by discussing implications for research on publicly disclosed reference groups, the consequences of power, and information disclosure. Collapse

Topics: organizational productivity accounting logistics management database system organizational context

Methods: qualitative interview instrumental variables estimation qualitative coding robustness check descriptive statistic

Global Leaders for Global Teams: Leaders with Multicultural Experiences Communicate and Lead More Effectively, Especially in Multinational Teams

2022 | Organization Science | Citations: 0

Authors: Lu, Jackson G.; Swaab, Roderick I.; Galinsky, Adam D.

Abstract: In an era of globalization, it is commonly assumed that multicultural experience ... Expand

Abstract: In an era of globalization, it is commonly assumed that multicultural experiences foster leadership effectiveness. However, little research has systematically tested this assumption. We develop a theoretical perspective that articulates how and when multicultural experiences increase leadership effectiveness. We hypothesize that broad multicultural experiences increase individuals’ leadership effectiveness by developing their communication competence. Because communication competence is particularly important for leading teams that are more multinational, we further hypothesize that individuals with broader multicultural experiences are particularly effective when leading more versus less multinational teams. Four studies test our theory using mixed methods (field survey, archival panel, field experiments) and diverse populations (corporate managers, soccer managers, hackathon leaders) in different countries (Australia, Britain, China, America). In Study 1, corporate managers with broader multicultural experiences were rated as more effective leaders, an effect mediated by communication competence. Analyzing a 25-year archival panel of English Premier League soccer managers, Study 2 replicates the positive effect of broad multicultural experiences using a team performance measure of leadership effectiveness. Importantly, this effect was moderated by team national diversity: soccer managers with broader multicultural experiences were particularly effective when leading teams with greater national diversity. Study 3 (digital health hackathon) and Study 4 (COVID-19 policy hackathon) replicate these effects in two field experiments, in which individuals with varying levels of multicultural experiences were randomly assigned to lead hackathon teams that naturally varied in national diversity. Overall, our research suggests that broad multicultural experiences help leaders communicate more competently and lead more effectively, especially when leading multinational teams. Collapse

Topics: team productivity website health information system ELT accounting

Methods: survey field experiment instrumental variables estimation descriptive statistic experiment

Theories: experiential learning theory big five model resource based view of the firm

Natural Language Processing in Internal Auditing – a Structured Literature Review

2021 | Americas Conference on Information Systems | Citations: 0

Authors: Schumann, Gerrit; Gómez, Jorge Marx

Abstract: To this day, the potential of natural language processing (NLP) is investigated ... Expand

Abstract: To this day, the potential of natural language processing (NLP) is investigated in different domainsauditing is one of them. Internal auditors have to deal with a large number of different business documents, which they have to analyze in various ways. The purpose of this structured literature review is to identify which document types have been addressed in audit-related research and which NLP methods have been used to process these documents. As a result, it was shown that within the main audit areas of compliance, risk identification and especially fraud detection, there is little diversity in the analyzed document types as well as a lack in the use of internal company data. It was also shown that the semantic text level is comparatively rarely taken into account and only a few studies had a direct exchange with auditors from the field to gather requirements or to additionally assess the results. Collapse

Topics: electronic mail database system privacy

Methods: literature sample natural language processing qualitative content analysis literature study company material

Corporate Strategy Changes and Information Technology Control Effectiveness in Multibusiness Firms

2020 | Management Information Systems Quarterly | Citations: 9

Authors: Tanriverdi, Hüseyin; Kui Du

Abstract: We develop a theory to explain why, how, and under what conditions corporate str ... Expand

Abstract: We develop a theory to explain why, how, and under what conditions corporate strategy changes negatively affect a multibusiness firm’s ability to design and effectively operate IT controls, and lead to the emergence of IT control material weaknesses (IT MW). Corporate strategy changes such as diversification, mergers and acquisitions (M&A), and divestitures alter a firm’s complicatedness by adding or removing business units. These changes can also affect the firm’s complexity by altering the degree of interrelatedness among the firm’s businesses. We hypothesize that corporate strategy changes that affect the firm’s complexity are more likely to increase IT MW than those that only affect the firm’s complicatedness. Complexity-altering corporate strategy changes are likely to disrupt all three types of IT controls: IT controls over technology, IT controls over business processes, and IT controls over people’s behaviors. We hypothesize that the changes are likely to disrupt the IT controls over people much more than IT controls over technology or business processes. Complexity-altering corporate strategy changes are also likely to affect the design effectiveness of the IT controls much more than the operating effectiveness of the IT controls. We find support for these ideas in a longitudinal study of 2,477 publicly traded U.S. firms. Results also indicate that the internal control material weaknesses (IC MW)that emerge following corporate strategy changes are primarily due to IT MWrather than non-IT MW. The proposed theory and the findings have important implications for research and practice. Collapse

Topics: strategic management business process management corporate governance Sarbanes–Oxley Act IS effectiveness

Methods: robustness check proportional hazards model longitudinal research theory development autocorrelation analysis

Uncovering the nature of the relationship between outsourcing motivations and the degree of outsourcing: An empirical study on Finnish small and medium-sized enterprises

2019 | Journal of Information Technology | Citations: 0

Authors: Asatiani, Aleksandre; Penttinen, Esko; Kumar, Ashish

Abstract: Prior literature has identified several outsourcing motivations, such as cost re ... Expand

Abstract: Prior literature has identified several outsourcing motivations, such as cost reduction and access to expertise, and deciphered the influence of these variables on outsourcing decisions. In another stream of outsourcing studies, researchers have gauged the degree of outsourcing, unearthing how companies may choose to outsource a set or processes instead of the whole business function. In this article, we draw on both of these streams of outsourcing research to study the relationship between outsourcing motivations and the degree of outsourcing within a particular business function. We probe the effect of nine motivation items on outsourcing decision through an empirical study using survey data gathered from 337 small and medium-sized enterprises. We find that cost reduction, a focus on core competence and business/process improvements are all associated with a higher degree of outsourcing, but interestingly, access to expertise is negatively associated with the degree of outsourcing. This finding suggests that companies that outsource mainly to acquire external expertise outsource only a limited number of processes within a specific business function. Our main theoretical contribution lies in uncovering the dynamic nature of outsourcing motivations, meaning that as companies outsource a larger degree of their business processes, some motivation items become more accentuated and others fade in importance. Collapse

Topics: outsourcing accounting business function business process outsourcing business process improvement

Methods: survey literature study simulation Markov chain Monte Carlo Bayesian analysis

Constructing continuities in virtual work environments: A multiple case study of two firms with differing degrees of virtuality

2019 | Information Systems Journal | Citations: 24

Authors: Asatiani, Aleksandre; Penttinen, Esko

Abstract: In this paper, we study how continuities are constructed in virtual work environ ... Expand

Abstract: In this paper, we study how continuities are constructed in virtual work environments by comparing two firms with differing degrees of virtuality. Using Organizational Discontinuity Theory and drawing on a qualitative study of two accounting firms operating in Finland, we observe virtual work discontinuities in the two firms and identify constructed continuities. We find that in constructing continuities, virtual organizations need to balance rigid and flexible approaches regarding governance structure, the role of technology, communication management, and workflow management. Our main contributions are an empirical application of Organizational Discontinuity Theory to the comparison of virtual work environments and a set of propositions regarding how firms approach continuity construction in different virtuality contexts. Collapse

Topics: IT supported collaboration remote work cloud computing accounting business process management

Methods: qualitative interview qualitative coding grounded theory case study survey

Theories: organizational discontinuity theory

Implementation of Automation as Distributed Cognition in Knowledge Work Organizations: Six Recommendations for Managers

2019 | International Conference on Information Systems | Citations: 1

Authors: Asatiani, Aleksandre; Rinta-Kahila, Tapani; Penttinen, Esko; Salovaara, Antti

Abstract: Knowledge work organizations are increasingly leveraging automation to enhance a ... Expand

Abstract: Knowledge work organizations are increasingly leveraging automation to enhance and transform their business processes. Many types of automation tools are being deployed in a large variety of information processing tasks, requiring effective management of human–automation co-operation. Yet, conceptual understanding of human–automation hybrid work remains thin and current literature lacks practical recommendations for managers. To address this gap, we synthesize findings from our three earlier case studies with organizations pursuing a wide array of automation tools and examine them through the lens of distributed cognition. We demonstrate how distributed cognition informs about the organizing for human–automation interaction when deploying automation. Our contribution lies in the presentation of six recommendations on three issues: human–automation task allocation, mitigation of the risk of deskilling, and management of collective knowledge across human and automation. Collapse

Topics: knowledge work process automation system malware protection malware knowledge management

Methods: case study qualitative interview personal interview theory development participant observation

Theories: theory of distributed cognition

Catching the Banksters: The Use of Big Data Analytics in Billion Dollar Regulatory Investigations

2018 | HICSS | Citations: 0

Authors: Gozman, Daniel; Currie, Wendy; Seddon, Jonathan

Abstract: Following the financial crisis, emboldened regulators have increased the magnitu ... Expand

Abstract: Following the financial crisis, emboldened regulators have increased the magnitude of fines levied for financial malfeasance. The automation of the data discovery process underpins the rise in internal investigations, which financial organizations are obliged to conduct on the behest of regulators, keen to reduce information asymmetries and bolster transparency. Yet little research exists into the technologies which underpin post-crisis regulatory agendas. Our study focuses on big data technologies (eDiscovery tools) which facilitate investigations, where rare yet serious breaches have occurred. We focus on the micro/data level (volume, veracity, variety and velocity) to understand how these tools are influencing regulatory outcomes. The findings illustrate the need for financial organizations to adopt robust information governance policies to ease future investigatory efforts. We identify various practices which may help compliance managers better respond to regulatory investigations faster and more easily to ease the burden of post-crisis regulation. Collapse

Topics: big data data governance marketing management IT manager

Methods: qualitative interview experiment case study company material