No matter what industry you’re in, staying profitable is always a priority. Reducing overhead costs is vital to this goal, and most advice for doing so these days involves technology.
But investing in new tech can seem like a luxury that companies only engage in when they have capital to burn. In today’s technology-centric landscape, however, utilizing and maintaining your technology is essential to keeping your business’s costs down, your profitability up, and your company thriving.
It’s not just about keeping up appearances. If you find yourself investing in the latest tech just because your competitors have it, you’re doing it wrong. And you likely won’t realize the true benefits of the technology you adopt. From helping you store more data and access it more efficiently to reducing errors in the manufacturing process, there are more benefits to modern technology than just keeping up with the Joneses.
The bottom line? Technology that improves efficiency will help boost your business’s profits. Use the following guidance to integrate new tech into your business in a way that cuts your costs, increases revenue, or provides more value to your customers.
1. When it comes to worn-out tech, spend money to make money.
If you let your tech get stale, you could be offering customers a lesser experience and risk losing them to a competitor with the latest tools. You may also be making your business more vulnerable to cyberattacks. It’s clear that to save money in the long term, you may need to spend some money in the short term to update your technology.
Companies are turning increasingly to the cloud to boost their computing capabilities while eliminating some of their on-site servers. Netflix did this so it could expand its customer base without investing in expensive infrastructure. This upfront cost will save you money in the long run. In fact, nearly 82 percent of companies that use cloud services report that doing so directly saves them money.
No matter what new tech you integrate, make sure you have someone knowledgeable on hand to help you get the most bang for your buck. As SimplyClouds, a provider of cloud services for businesses, points out, “Software is expensive, and without technology expertise, many business owners end up with ‘shelfware’ IT.” That on-hand expert can be someone on your team, a consultant, or — in the case of tech services like the cloud — the support staff from your business partner.
2. Use tech to streamline processes.
Need to streamline processes to boost productivity? Daniel Wesley, founder and chief evangelist of Quote.com, suggests, “AI is a good place to start, as it offers the promise of unprecedented customer personalization without the need for constant human intervention. AI also helps simplify data interpretation, providing an efficient way to find sweet spots in areas like sales and client service models.”
You can also use machine learning and AI to create products faster, with less manpower, and with fewer errors throughout the entire process. The San Francisco restaurant Creator is a perfect example of this: Employees are still needed, though a smaller number, because a robot is responsible for all of the cooking. A robot chef also means fewer errors and fewer chances of illness spreading.
Predictive maintenance — an Internet of Things-powered capability that can help manufacturers prevent problems before they even happen — represents another opportunity to cut costs through improved processes. In fact, a McKinsey Global Institute report estimates that, by 2025, predictive maintenance could help companies save $630 billion a year. DB Cargo, a German railway cargo carrier, uses this method to identify issues with its locomotives sooner, meaning its trains are out of commission less often.
3. Use tech to give customers the service they crave.
Want to improve your customer relationships? Implement AI-driven customer service tools to guide consumers through their journey. You don’t have to hire a 24/7 team of customer service professionals to provide ‘round-the-clock service to your customers, thanks to automated solutions like chatbots. Just look at ICICI Bank, one of the largest banks in India, which uses robotic process automation for more than 200 banking functions, including retail banking and HR management. As a result, the bank cut its customer response time by up to 60 percent while decreasing its error rate.
Building strong relationships with your customers means interacting with them on many different fronts, from marketing campaigns to sales, customer service, and help desks. When it comes to integrating AI into your business, consider the customer experience. For instance, Sephora saw high levels of engagement when the cosmetics company encouraged teens prepping for prom to chat with its bot personal assistant on Kik. The bot, in turn, provided makeup tutorials and product reviews.
After implementing or updating your tech solution, be sure to measure its success. Has your predictive maintenance solution reduced equipment downtime? Has your chatbot improved your customer retention rate? Reduced your personnel costs? To assess the value of your tech adoption, identify the best metrics for gauging success and review that data after enough time has passed for you to make an accurate assessment. Whether the data says you’re on the right track or in need of a course correction, it will help you determine how to best leverage your technology investment to boost your company’s profits.