Business Preferences About Labor

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By Saji Nair

Business without the use of computers in 21st century is unthinkable. Even in a local restaurant, we see the business process for taking orders and assigning tables, inventory and stock management are now being automated. This means the restaurant staff must know how to use the technology solutions it has adopted, to make the service efficient. If not, customer experience will be a major disaster. My last article was an evaluation of business perspective to adopt new technology or upgrade the existing ones. I promised to write about the perception of leaders and impact of technology on its staff in the post implementation scenario.

In every industry, there exists two different categories of skills – core business or technical. Business skills represent the operational skills or the industry specific knowledge about the business required to be in the industry while technical represents the engineering and operational software/hardware/management related skills. The same local restaurant considered above will require various kinds of people with skills like understanding supply-chain of raw materials, business management, supply chain & inventory management, culinary skills, customer service and management, marketing and advertisement, etc. to name few. Technology skills would relate to architecture and solution definition, design and implementation, testing and quality assurance and finally project management. A typical mix of business and technology professionals in any company would look something like the ones shown in the figure below (Picture used is Not to Scale and represents a general pattern rather than actual numbers specific to an organization).

Critical knowledge of business model & technology architecture, solution design pertaining to automation of the queue management for customers, supply chain & inventory management, staff working hours management to suite customer demand, skills of chef, etc. are critical because these are the processes which are most likely automated and creation of a proper architecture will pave way for robust solution.

However, in the last few years it has emerged that the staff have to not only know their core business skills, but also understand how to execute their responsibilities using technology. In short, as we discussed in Changing Nature of Jobs due to Technology Influence, the core business has not changed much, but the execution certainly has made rapid strides with technology adoption. Every professional now needs to be tech savvy and aware of how the changing technology trends to be competitive in the job market. Technology has become such an integral part of regular operations that it is becoming a sizeable part of the operating costs. Every year, as more and more business processes and operations come under the influence of technology, it is expected to improve the throughput as well as lower costs.

Business leaders have to understand the implications of their strategy in using technology, especially on its workforce while balancing the cost. Training staff, loss of business during the transition time (if there is any down-time during transition), availability of skilled professionals, redundancy (if any) in the existing staff and their transition to new responsibilities, etc. all add up to the cost. The customer experience post transition must be better and there should be no service disruptions. The challenges to achieve these goals often take precedence while deciding a change though being on par with market also dictates this decision. Management will rarely adopt a technology in the operations which requires skills that is scarce in the market, unless of course it forms the core competence or is a major competitive advantage.

In the last few years, it has also been observed that the cost of technology operations have become significantly more than the projections, especially in the Technology Consumer environment. Most businesses have robust processes, specially tailored and recommended by consulting firms or business practices followed by the best in business product companies. Cost mitigations like contract staffing, outsourcing, offshoring and even knee-jerk reactions like downsizing have been adopted to address the cost factor. These have just increased the complexity of the operations but kicked the central issues of architecture down the road. If you are familiar with these kind of situations in your business environment, you are welcome to discuss it with us.

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