Tech To Replace Employees

I’m reading this WSJ article on tablets in a small business. They state that this small business owner was going to counter a possible minimum wage hike by buying a tablet presumably to allow more self-ordering, reducing 10 employees hired to take these orders. There is a lot of assumptions here on how this works so let’s think about this.

brokenTech Doesn’t Always Work

I’m a big fan of tech but it often doesn’t help. First of all the owner says that a tablet is now around $400 when before they were $1,300. If that were the case she lost a lot of money not doing this last year. $1,300 is a lot cheaper than a year of an employees wages even at $7.25/hr.  Consider when grocery stores put out self-checkouts. Some work well and others not so much. These are complex integrated systems that have scanners, touch screens, scales, card readers, printers, network connections. All of them have to work perfectly in the symphony of processes to get a customer through the checkout. I’ll confess at being impatient waiting behind an older person using the self-checkout. My wife has often heard me grumble that they should go through the regular line (it is faster for them over there.)

 

Tech Doesn’t Always Reduce Labor

strainProviding support for these devices is required and hiring a person that can support people is a more highly skilled job than writing orders down on a piece of paper. Support costs may be higher than the basic labor costs so your specific business model needs to be tested. In fact that’s the key here, until I see a test with the system I would not run out and buy a bunch of tablets. Start with one then expand to two and walk your way up. If your goal is to reduce labor than your budget can be high. Replacing labor can be a big cost savings, just know what you are giving up.

Small Tech Means Watch For Theft

purseTablets are convenient and easy because they are small. If you are going to use tablets with customers there is a chance of theft. Account for this in your budgeting. Again the testing phase and gradual replacement gives you a chance to see both their effectiveness and their true costs. Durability is also an issue.

 

 

 

For me the lesson is try it but be conservative in your roll out. Oh, and don’t forget to prepare for the change-management issues. Once employees know they are being replaced their performance will decline.

 


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