Organizational and Economic Obstacles to Automation: A Cautionary Tale from AT&T in the Twentieth Century / James J. Feigenbaum, Daniel P. Gross.

Format:

Book

Author/Creator:

Feigenbaum, James J.

Contributor:

National Bureau of Economic Research.

Gross, Daniel P.

Series:

Working Paper Series (National Bureau of Economic Research) no. w29580.

NBER working paper series no. w29580

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2021.

Summary:

AT&T was the largest U.S. firm for most of the 20th century. Telephone operators once comprised over 50% of its workforce, but in the late 1910s it initiated a decades-long process of automating telephone operation with mechanical call switching--a technology invented in the 1880s. We study what drove AT&T to do so, and why it took nearly a century. Interdependencies between call switching and nearly every other activity in AT&T's business presented obstacles to change: telephone operators were the fulcrum of a complex production system which had developed around them, and automation only began after the firm and new technology were adapted to work together. Even then, automatic switching was only profitable in larger markets--hence diffusion expanded when the technology improved or service areas grew. The example suggests even narrowly-defined tasks can be difficult to automate if they interact with many others.

Notes:

Print version record

December 2021.