Sydney, Australia, October 25, 2012 – According to Mike Coney, Vice President – Asia, CargoWise, there is something about being human that makes us avoid difficult choices until we’re pushed to the verge of total collapse.
“If things are going well we don’t tend to look for ways to make things better. After all, if it’s not broken why fix it?” he says. “Unfortunately, this way of thinking is the reason company productivity tends to stagnate during periods of economic growth. If we’re dealing with increasing demand, it is just as easy to bring on additional people to do more of the same thing your existing staff is already doing. Or, we can try to get the people we already have on staff to simply work harder and put in longer hours, which means they spend more time doing more (and often repetitive) work, and less time figuring out how to do things better.”
But, Coney points out, that while this approach might appear to work in the short term, in the long term, these are flawed strategies that will see your competitors pull ahead of you and ultimately overtake your business. Focusing on getting more people to do more stuff won’t increase your productivity, because as it increases your output, it adds to your costs. You may receive an increased cash flow, but it will cost you more to make more, whether through an increased wages bill, or additional HR costs when you’re forced to replace the staff you lose through attrition.
“Most companies only start to think seriously about how to do things more efficiently when there’s a market downturn,” he says. “Only then do they begin to look to technology in order to do more with less. It’s usually not until demand falls and income drops that many begin looking for ways to increase income without increasing their cost base. But productivity only really increases when companies figure out how to increase outputs with fewer inputs, or with a better deployment of inputs. In the last 30 years, the greatest catalyst to business productivity has been the capacity of software to automate the most boring and repetitive tasks throughout the supply chain and in the broader economy.
“If you have smart people doing repetitive tasks, resources are being wasted, and you’re quite simply not being as productive as you should be. If you have sales and customer service staff passing data from one system to another, you are wasting resources that could be better deployed elsewhere. And if you have smart people in different offices and countries effectively duplicating each other’s work simply to transfer data from one system to another you are wasting time and money doing tasks which shouldn’t need to be repeated. It turns out that lost productivity isn’t only about what employees are not doing well, it’s also about what they could be doing a great deal more efficiently if human resources are redeployed into areas where they are needed, rather than bogging them down in data transfer tasks - much of which can be automated.
“The benefits of freeing up good staff with an automated system are multifold,” summarizes Coney. “Not only does a single, integrated system enable staff in all locations to complete more work, in a more efficient and timely manner, it also provides more time for staff to focus on those parts of their role which simply can’t be automated – like strategic planning, human interaction and innovation. Investment in today’s computerization has significant long-term impacts on productivity, because the people who would have been kept busy transferring data from one system to another can more effectively focus on developing new business processes and inventing new (and better) ways to interact with customers and suppliers.
“So why wait for the downturn before investing in automation? By improving your systems now not only can you take on more work in the upturn, but you’ll future-proof your business and processes to be more productive when the market turns.”
Mike Coney is Vice President – Asia, CargoWise®
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