Increasing productivity is essential for any business to succeed. For small businesses in particular, productivity is vital to gaining a competitive advantage over larger firms with better resources. SMEs wanting to increase their foothold in the market need to consider how they can reduce costs and improve their processes – automation can be a cost effective way to increasing productivity.
SMEs and automation
The use of automation to improve business processes is common in the comerical world. One major type of automation familiar to most of us is the use of computing technology to manage information, data and processes. It might be known as IT, ICT or digital capability but the UK’s SMEs are increasingly turning to automation to boost their productivity in various areas of their business such as managing their workforce, payroll and marketing. Over half of UK SMEs have already invested in new technology and software in the belief that it will add to business efficiency.
Productivity and small businesses
While we know that most small businesses work very hard, a productivity report found that one in 20 UK SMEs don’t know what productivity is – or how to measure it.
Productivity is a key measure for how your business is performing. The government measures productivity by dividing output (the volume of goods and services produced by an industry) by labour input (numbers of workers and hours worked).
While growth in UK productivity has stagnated since the 2008 economic collapse, there have been some more hopeful signs recently. For example Government figures for the Dec-to-Jan 2017 period show that labour productivity (in output per hour terms) grew in both Service and Manufacturing Sectors; Service sector productivity grew by 0.3% on the previous quarter and manufacturing productivity grew by 2.6%.
The same productivity report also found that some ten hours a week are being lost to bureaucracy while both presenteeism and absenteeism were said to cost employers on average 27.5 days worth of productivity per employee each year.
Ways to improve productivity through automation
A major route for small businesses to improve productivity is to look to technology to get the most out of their staff. In fact, a government select committee this month received submissions from HR professionals which have called for the automation of HR tasks to boost productivity.
Here are some suggestions for areas SMEs should consider:
- Adopt paperless systems – many SMEs are moving away from old-fashioned ways of working. Paperless systems can be more accurate and reliable because information can be located more quickly and have less chance of getting lost or destroyed. Another benefit is that employees can quickly become demotivated working with out-dated systems; a modern working environment is also more likely to help staff recruitment and retention.
- Move to cloud computing – businesses who’ve already embraced IT but using local systems could consider moving to the cloud. Cloud computing means your data is accessible 24/7 and enables remote workers to access your systems on their own devices. The adoption of cloud services in the UK initially lagged behind the US, but now an estimated 69% of UK businesses use cloud-based applications, and more than half (53%) say that they are vital to effective remote working (British Chambers of Commerce).
- Explore Software as a Service (SaaS) – businesses now use computers rather than manual processes for many of the tasks which they need to undertake – such as accounting, payroll and keeping track of staff. However, purchasing, installing and maintaining locally-held software which might require IT support and regular updates can be costly and time-consuming.
SaaS providers host their software in the cloud which can perform these and many other functions; most are subscription based, SMEs simply set up a monthly subscription to benefit from the software, the SaaS provider stores the data and takes care of upgrades and support.
- Improve workforce management – many of the routine HR tasks which managers spend time on can be automated. For example rather than using paper timecards or timesheets these can be viewed online as staff clock-in and out using an automated time and attendance system; the data can then be exported to your payroll system, ensuring timely and accurate payroll.
An automated time and attendance system such as uAttend offers businesses a simple and cost-effective way of managing their workforce.