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Posted 28th June 2021

4 Reasons Your Small Business Needs an Automation Strategy

Most people think of automation as a long production line where machines do most of the work to maximize output. Robotic arms and conveyor belts manage the entire factory or plant with minimal human input. This point of view isn’t wrong, as this is how businesses have been doing for the past several decades, increasing productivity to meet growing demand.

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4 reasons your small business needs an automation strategy.


4 Reasons Your Small Business Needs an Automation Strategy

Most people think of automation as a long production line where machines do most of the work to maximize output. Robotic arms and conveyor belts manage the entire factory or plant with minimal human input. This point of view isn’t wrong, as this is how businesses have been doing for the past several decades, increasing productivity to meet growing demand.

While increasing productivity is one of its main points, automation isn’t just limited to assembly lines. For a small business, automating most of its processes is crucial for its survival in a competitive (and pandemic-affected) market. Someone as small as a local plumbing service stands to benefit from leaving critical tasks to technology.

This guide will discuss the reasons SMEs should seriously consider adopting an automation plan and the long-term benefits and implications.

 

1. Poor customer service can cost you

Picture this: you’re the owner of a premier plumbing service in the neighbourhood, the go-to guy for leaky pipes and other problems. Such a reputation comes with a packed schedule for a service that only has a handful of plumbers on call. Worse, each day of delay increases the likelihood a customer will favour another plumbing service.

Losing a customer to a competitor, especially a long-time one, won’t just cost you in terms of lost revenue but also spending to attract a new one. Depending on the industry, getting a new customer can cost up to 25 times more than keeping an old one. Conversely, keeping customers loyal to the brand will nearly double your revenue.

Packed schedule or not, the inability to fulfil your obligation on time is one way to lose customers. Automation solutions work around this by managing a schedule of orders and tracking them until completion. In the case above, plumbing scheduling software will help even small service groups make the most out of their time by:

  • Arranging a convenient date to deliver service

 

  • Committing to any follow-up visits 

 

  • Tracking the status of each job order

 

2. COVID forced a change in doctrine

The pandemic has forced businesses to give automation a thoughtful rethink, as employees either fell ill with the disease or are unable to report for work due to quarantine measures. The need for social distancing, even post-pandemic, has resulted in factories and plants adopting state-of-the-art remote machinery. A single operator now has to do the job of hundreds.

The same can also be said for SMEs. In a survey of nearly 6,000 SMEs in the U.S. at the height of the pandemic (March and April 2020), 43% said they had to temporarily cease operations out of a need to protect their employees. In addition, 39% said that they had reduced their workforce, as low demand meant low revenue and the ability to retain their standard employee pool.

Automation is a boon for businesses for a simple reason: unlike humans, machines and software programs don’t get physically sick, let alone take sick days. Not every task needs to be left to technology, though, at least not immediately. 

While measured long-term, experts believe its cost reduction can reach up to 75%. SMEs can recognize the savings in requiring fewer people to perform dozens of tasks. However, for any shift to automation to succeed, it must be done piecemeal.

 

3. Complying with Data Privacy Laws

SMEs that regularly handle personal information such as credit card info and medical records must leave such a sensitive process to software. Storing data in old-fashioned drawers or your desk is one way to earn the ire of data privacy legislation, not to mention your customers.

In the U.K., the Data Protection Act of 2018 outlines the responsible use of personal information by both the public and private sectors. Aside from the examples above, the Act also requires that specific details like ethnicity, sexual orientation, and biometrics be safeguarded under enhanced regulations. These are outlined under the General Data Protection Regulation (GDPR).

For SMEs, the GDPR requires that they inform their customers how they protect their personal information. Without a comprehensive solution, customers won’t feel confident about an SME and may opt to look elsewhere. Furthermore, SMEs are equally liable to data breaches and other privacy issues as corporations under the GDPR.

Automating data privacy has two benefits. First, it reduces the number of people required to perform tasks. As experts indicate that many data breaches are caused by insider activity, having fewer employees lessens the risk of someone leaking the information.

Second, it lessens data error by streamlining the process. With manual entry, an employee can get important details like address and contact details incorrect, resulting in miscommunication. Accuracy is vital, especially with automated decision-making now available.

 

4. E-Commerce is Now the Norm

Another effect of the COVID crisis, though unintended, is the rise of e-commerce. People unable to go to malls or restaurants flocked to online stores for their wants and needs. In fact, during the first year of the pandemic, many businesses went digital to continue doing business. As a result, e-commerce’s global market share increased by three percentage points in 2020.

With automation, SMEs can integrate multiple e-commerce management tasks that are essential in maintaining an online store. Owners can update product information on the fly, streamline the ordering process, and update customers on delivery times.

 

Conclusion

Overall, adopting an automation strategy isn’t just for large corporations that maintain factories and plants. It also works for SMEs that do business on a much smaller scale. You can expect to invest a great deal in implementing such a strategy, but the benefits will be worth it in the long run.

Categories: Business Advice, News


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