What are the downsides of automation?

WLP Group

Automation means using machines or software to do tasks that people usually do. Automation can be really good in many ways.

But it is not always perfect. Here, we’ll look at some of the downsides.

Job Loss

The big downside of automation is that it can take away jobs. When machines can do the work, companies might not need as many people. This can lead to unemployment.

Errors and Mistakes

Machines are not perfect. They can make errors that can cost a lot of money or create other problems. Sometimes, human judgment is better. In complicated areas of finance like identifying bank fraud, machines are used to help humans. You still need people to gather information and analyse it. But programs like Excel are now tools that people use to do their job faster.

Less Human Connection

With more machines doing the work, there’s less need for people to talk to each other. This can make work less enjoyable and can affect team spirit.

Not Flexible

Machines do what they’re programmed to do and nothing more. If a new problem comes up, a human might have to step in to fix it. Machines can’t think outside the box.

Expensive to Start

Setting up automation can be costly. Small businesses might not be able to afford it. Also, if the technology becomes old, it can be expensive to update.

Examples in Finance and Accounting

Positive: Speedy Data Entry

In accounting, automation can quickly put numbers and data into the system. This saves time and reduces mistakes made by people. For example, DBS is one of the largest banks in Singapore.

Xero has bank feeds with DBS. Xero connects to DBS’s API. Xero automatically transfers financial data from DBS statements to Xero. This means no hassle and manual bookkeeping for you.

Negative: Fraud Risks

Hackers can take advantage of automated systems. This can lead to money being stolen or data being messed up. Automation can sometimes make things less safe. But there are a lot of precautions companies take. Google backups all your Google Drive data. Google has the best smartest people in the world on cybersecurity.


Automation has its perks but it’s not always the best option. It can lead to job loss, errors, and can be expensive. It’s important to think carefully before choosing to automate tasks.