The Impact of Technological Change on Business Activity

Technology has revolutionized the
way companies conduct business by enabling small businesses to level the
playing field with larger organizations. Small businesses use an array of tech
-- everything from servers to mobile devices -- to develop competitive
advantages in the economic marketplace. Small business owners should consider
implementing technology in their planning process for streamlined integration
and to make room for future expansion. This allows owners to create operations
using the most effective technology available.

Impact
on Operating Costs

Small business owners can use
technology to reduce business costs. Basic enterprise software enables a firm
to automate back office functions, such as record keeping, accounting and
payroll. Mobile tech allows home offices and field reps to interact in real
time. For example, field reps can use mobile apps to record their daily
expenses as they incur them and have them sync automatically with accounting
software back at the office. Business owners can also use technology to create
secure environments for maintaining sensitive business or consumer information.
Many types of business technology or software programs are user-friendly and
allow business owners with only minor backgrounds in information technology to
make the most of their tools and features.

Improved
Communication

Business technology helps small
businesses improve their communication processes. Emails, texting, websites and
apps, for example, facilitate improved communication with consumers. Using
several types of information technology communication methods enable companies
to saturate the economic market with their message. Companies may also receive
more consumer feedback through these electronic communication methods.
Technology also improves inter-office communication as well. For example,
social intranet software gives employees a centralizes portal to access and
update internal documents and contractz and relay relevant data to other
departments instantly. These methods also help companies reach consumers
through mobile devices in a real-time format.

Increased
Productivity

Small businesses can increase their
employees' productivity through the use of technology. Computer programs and
business software usually allow employees to process more information than
manual methods. Business owners can also implement business technology to
reduce the amount of human labor in business functions. This allows small
businesses to avoid paying labor costs along with employee benefits. Even
fundamental business tech can have a major impact on employee performance. For
example, by placing employee-performance appraisal information in an online
framework, supervisors can easily create measurable goals for their employees
to reach and sustain company objectives. Business owners may also choose to
expand operations using technology rather than employees if the technology will
provide better production output.

Broaden
Customer Bases

Technology allows small businesses
to reach new economic markets. Rather than just selling consumer goods or
services in the local market, small businesses can reach regional, national and
international markets. Retail websites are the most common way small businesses
sell products in several different economic markets. Websites represent a
low-cost option that consumers can access 24/7 when needing to purchase goods
or services. Small business owners can also use internet advertising to reach
new markets and customers through carefully placed web banners or ads.

Collaboration
and Outsourcing

Business technology allows companies
to outsource business functions to other businesses in the national and
international business environment. Outsourcing can help companies lower costs
and focus on completing the business function they do best. Technical support
and customer service are two common function companies outsource. Small
business owners may consider outsourcing some operations if they do not have
the proper facilities or available manpower. Outsourcing technology also allows
businesses to outsource function to the least expensive areas possible,
including foreign countries.

How Is Technology Impacting the Changes in the 21st
Century Workplace?

The impact of technology on the
future of work is uncertain. Many qualified observers feel that technology,
especially automation, machine learning and artificial intelligence, will
drastically reduce the number of available jobs in the near future – perhaps
within 20 years. Other authorities contend the same technology that is taking
away jobs or reducing wage increases now will also open up significant new job
opportunities. One thing is certain: the job market in the near future will
look nothing like the job market of 2018.

The
Moderate View

The early 2017 McKinsey Report
entitled "Harnessing Automation For a Future That Works," concludes
that with current or soon available technology, 49 percent of work across 800
occupations from entry level to C-suite can be automated. But they do not
believe that just because the technology is available, half of all jobs are
going away anytime soon. James Manyika, McKinsey's lead author of the report,
believes "This is going to take decades," because transforming the
workplace not only involves technological change, but societal change as well.

Nevertheless, the report concludes
that eventually current technology has the potential to eliminate over 1
billion jobs while eliminating $15.8 trillion in wages.

Other proponents of the moderate
view concede that many jobs, perhaps a billion, are going away – especially
manufacturing and unskilled jobs – but that other jobs will replace many of
them.

A
Less Optimistic View

Arwa Mahdawi, writing in The
Guardian, agrees that although many jobs are going away, other jobs will
replace many of them. The problem, he argues, is that those displaced from jobs
taken over by technology will not have the skills necessary to seek employment
in these new job areas and are likely to remain unemployed for the remainder of
their lives.

Jobs most at risk are those that are
routine, repetitive and predictable, such as fast food preparation,
telemarketing and assembly line work. Eventually, however, many highly-skilled
jobs will disappear as well. Algorithmic equity management costs far less than
an investment advisor and does a better job than a majority of investment
managers, most of whom underperform an S&P 500 Index Fund. A University of
Indiana study of 500 patients concluded that a computer program was 42 percent
more accurate in diagnosing illness and recommending appropriate treatment than
a group of experienced diagnosticians and at about 40 percent of the cost.

Armageddon?

Some prominent technologists and
futurists believe the idea of new jobs replacing old jobs and offering new
kinds of employment as technological advances continue is unlikely in the
extreme. A 2013 Oxford University study concluded that in the U.S. about half
of all jobs will disappear in the next 10 to 20 years, but that in less
developed countries, job losses will be significantly worse. This latter group
of observers of technological impact believe that job losses will be massive
and permanent, eventually taking over even the highly skilled jobs that seem
secure today.

Elon Musk, the innovative
entrepreneur who started Tesla, Solar City and SpaceX, believes the only
peaceful way out of the eventual, nearly complete elimination of jobs is a
worldwide guaranteed annual income provided to everyone. Finland began
conducting a test of this concept in 2017, offering 2,000 Finns a guaranteed
monthly payment of $560 Euros (about $600).

If this is the future, it will not
arrive without controversy and the determined opposition of social and economic
conservatives who see this as just another form of welfare – what Republican
presidential candidate Mitt Romney dismissed as "a handout." The
Conservative Foundation For Economic Education proposes three reasons why a
guaranteed income won't work. The reasoning isn't impressive (too expensive!)
and redundant (handouts don't work and welfare doesn't work). But the
opposition to a society without work is real.
If Musk and others are right,
and work is going away, no one yet has come up with a widely accepted
replacement.

How Does Technology Affect the Work Environment Today?

Every workplace can benefit from
technology. Even a small plumbing business with three employees can use
software to track clients and document all aspects of work. Accounting and
marketing software programs are available to help small and large businesses.
Although software is designed to save time and energy, it's important to
remember that technology can erase the human touch if it’s carried too far.

Speed
of Connections

Technology helps organize the work
environment. Everything from payroll to inventory is managed more efficiently
with well-designed software in place. Documents, such as letters or government
proposals for contract work, are easier to write and edit on the computer.
Phone systems include technology for three-way or four-way calling, for
example, to save time. Conference calls also save plane fare and hotel costs if
group calls are productive.

Flexible
Options

Virtually all modern technology,
from cellphones to e-readers, saves time and energy. Instead of having to stay
in the office, as workers did little more than a decade ago, businesspeople can
take calls on the go. Electronic readers help business travelers access
newspapers, mobile messages and the Internet quite easily. This makes traveling
less cumbersome, because paper materials can stay in the office. Emailing
business associates from an electronic device means there is no need to return
to the office after work if you're traveling around town or already headed
home.

Judgment
Calls

One disadvantage to technology is
it’s possible to actually slow down work with it. For example, checking one’s
email too often negatively affects productivity. It’s better to stay focused in
making 20 calls versus checking email every 15 minutes. Distractions, such as
phone calls, are often best managed by voice mail. Employees, however, hurt
relationships with clients and slow down business projects when voice messages
pile up.

Live
Operators

Technology can frustrate clients who
need to reach you. For example, individuals calling a help desk for answers to
a question might not reach a live person. Pressing numbers to communicate your
needs, such as “1 for yes” or “2 for no,” depersonalizes the relationship
between customers and the companies they patronize. Having a live operator as
an early option keeps callers much happier. Otherwise, they may take their
business elsewhere.

Accountability
Concerns

It’s likely that technology can help
workers dodge true responsibilities. Every business owner knows voice mail and
email can work against a company’s bottom line. An employee who wants to slack
off for an hour or two in a private office might let voice mail take calls and
ignore important emails. During this downtime, business calls that might have
resulted in sales or important relationships are diffused or gone for good.

Global
Interfacing

Work projects and business profits
all connect to globalization enabled by technology. Everyone can connect with
those in foreign countries with the click of a mouse. Decades ago, it would
have taken months or years to find an inroad with a foreign partner or
associate. Today, you can build a business with someone in another country in a
matter of weeks -- or even days.

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