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The Organization for Economic Co-operation and Development (OECD) forecasts that global growth will contract from 6% to 7.6% in 2020, and that it may take years to return to pre-crisis growth levels. . Many companies have instituted general spending moratoria, frozen hiring, and deemed most new purchases non-essential. However, some business leaders understand that there are opportunities to optimize business efficiency, capture more market share, and profitably invest in critical infrastructure. HBR suggests playing offense and defense by first stabilizing your business and ensuring liquidity, then figuring out how to outsmart your competition.
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The current business environment has caused many software vendors to downgrade their forecasts for 2020, but some software companies, like my team at Anvyl, have taken a different approach. We’ve illustrated the competitive advantages customers can gain by spending more money on tools that empower their teams to adapt, deliver better customer experiences, and achieve a clear return on investment. Here are three reasons why investing in software now can make your business more resilient and profitable.
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1. Ladder without hiring.
If you plan to hire new employees to scale your business, it’s important to understand what each new hire will cost your organization. In addition to salary, benefits and payroll taxes; recruiting, onboarding and training a new employee can also be costly. Before hiring, determine if your teams are actually operating at their maximum capacity. Evaluate whether greater efficiency could be achieved through software, collaboration, or better processes. Consider barriers to optimal output and uncover issues that could delay, frustrate, or hinder the effectiveness of the organization. If you look closely, these opportunities exist in almost every business.
For example, one of Anvyl’s clients was able to achieve a 300% increase in productivity with their existing team by adding collaborative supply chain visibility software. Before evaluating ROI, the company planned to hire two or three additional employees. Once it discovered the flaws in its process, the company determined it could recoup nearly 6,000 hours of unproductive work by adding collaboration software. This eliminated the need for each employee to maintain a spreadsheet, manually call and email vendors for each order, or search for original files on old discussion threads.
2. Automate repetitive tasks.
Artificial intelligence and machine learning tools have become more accessible and affordable for businesses of all sizes and in all industries. Gartner’s 2019 CIO survey found that the number of organizations implementing AI has grown by 270% over the past four years, despite the talent shortage.
AI / ML software allows you to automate boring or repetitive tasks, freeing up your team to focus on more creative or strategic work. What employee responsibilities could you give technology to increase employee happiness, engagement, or productivity? Automated chatbots, data analytics, or lead generation and sales tools can go a long way in reducing operational inefficiencies, improving team morale, and maximizing results.
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3. Improve visibility.
Transparency in your business operations is crucial when preparing for unforeseen challenges, as many manufacturing companies have learned in the midst of these difficult times. It is essential to identify potential disruptions in your business operations and have a plan to mitigate them in advance. Implementing real-time visibility software into functional operational areas such as supply chain, logistics, sales and customer success will enable proactive and strategic decision making.
Your leadership team should have real-time visibility and cross-functional data access across all departments. The addition of software will democratize data between departmental silos, mitigating the risk of data loss in the event of unexpected employee departures, and also enable timely strategic decision making.
Economic downturns are inevitable, but recognizing the opportunity and taking decisive action can dramatically improve the trajectory of your business. Focus on maximizing business efficiency, gaining more market share, and investing in the future of your business.