07/08/18

How Automation Will Strengthen Small Business

The term “automation” is often associated with job loss. After all, dire headlines like “Automation could kill 73 million U.S. jobs by 2030” and “Automation to kill 70% of IT jobs” are everywhere.

A report from Forbes.com, however, asserts that while automation will have some negative effects on larger corporations, it “may actually be the key to triggering a renaissance on Main Street.”

The main reason for this comes down to customer service. Small businesses have always had that competitive advantage—being able to provide a more personalized experience for their customers. But running a small operation can spread you pretty thin, which is where automation comes into play. By taking key tasks off your plate, you’ll be able to focus more attention on your customers, which strengthens your advantage.

This is why Forbes says the software-as-a-service (SaaS) movement may very well help our nation’s mom-and-pop shops excel. Which would be ironic, given the fact that many observers have assumed software would actually hasten the demise of small businesses.

The secret to the small business automation success story is tied to the “experience economy” as defined by Joe Pine and Jim Gilmore in the Harvard Business Review way back in 1998. In a nutshell, Pine and Gilmore stated that as the services and products offered by businesses become commoditized, consumers have raised their expectations and continually seek experiences.

Small businesses are perfectly designed to deliver these kinds of unique experiences. After all, large corporations are predicated on standardization. Walk into any Costco in the world and you’ll know exactly what to expect. This is definitely not the case with small businesses.

American consumers have long relied on small businesses for these kinds of distinct and worthwhile experiences. And the result is trust. As reported in Gallup’s Confidence in Institutions report, small businesses are among the country’s most trusted institutions. Wallowing at the bottom of the list, next to Congress, are big businesses.

The main thing that eats into consumer trust is when businesses don’t deliver on expectations. And when trust is lost, it’s awfully hard to earn back. This is why small businesses are in such a prime position. They already have high levels of trust, and automation makes it much easier for them to manage their online reputation and leverage their inherent strength.

Small businesses aren’t designed to compete with Walmart on scale, ubiquity, or sophistication. But that’s just fine, because a large segment of consumers want the unique experiences that small businesses provide. And by using automation, businesses can put even more emphasis on these experiences and let many of the day-to-day details become streamlined with the SaaS model.

The good news is that our nation’s small businesses are finally starting to harness this advantage. According to one report, SaaS usage by small businesses was only 27% back in 2011, but it’s now about 94%.

Get more small business tips from Lendio.

About the author

Grant Olsen
Grant Olsen
Grant Olsen is a marketing and technology writer with a B.A. in English from Brigham Young University. He has written for healthcare companies, outdoor gear manufacturers, international airports, and dozens of small businesses. Grant is a contributing writer for KSL 5 TV and Lendio News. He is also the author of the book “Rhino Trouble.”

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