How COVID-19 Has Affected the Unemployment Rate
With the introduction of the COVID-19 virus in late 2019, continuing into the middle of 2020, companies and employees have been affected globally. Unexpected events like this can devastate any industry in any economy and are reflected in the employment statistics in the United States this year.
According to the US Bureau of Labor Statistics, the number of unemployed persons rose by 15.9 million to 23.1 million in April of 2020 alone. These drastic changes in the employment resulted in “the lowest rate and largest over-the-month decline in the history of the series.
Every industry has been affected by this global situation and has experienced declines in employment, downsizing, and cost-cutting measures as a response. Though companies cannot be blamed for taking these actions, common practices may not be the best solution for preparing for the future.
Hoping to glean helpful insights, employees and business leaders alike seek out examples of businesses that do well in recessions.
Businesses That Do Well in Recession Deploy Defense AND Offense
Companies that find themselves suffering during economic downturns and recessions can be categorized into groups based on their strategic responses during these times. According to the Harvard Business Review, “companies typically combine three defensive approaches—reducing the number of employees, improving operational efficiency, or both—with three offensive ones: developing new markets, investing in new assets, or both.”
Using these criteria, we can analyze past efforts by companies to categorize them accordingly. Categorizing companies as defensive and progressive based on their actions during and after recessions helps identify effective strategies for emerging successful in prerecession economies.
Prevention-focused companies, which make primarily defensive moves and are more concerned than their rivals with avoiding losses and minimizing downside risks.
Promotion-focused companies, which invest more in offensive moves that provide upside benefits than their peers do.
Pragmatic companies, which combine defensive and offensive moves.
Progressive companies, which deploy the optimal combination of defense and offense.
How to Improve Efficiency of Operations
Taking from the examples presented in the Harvard Business Review’s study, we can discern that improving efficiency in business operations is one of the key factors for success in recession.
While progressive companies do cut staff during recessions, they do so at a lower rate. The Harvard Business Review study reports only 23% of progressive companies cut staff while 56% of prevention-focused companies cut staff at much higher numbers comparatively. Rather than cutting costs through layoffs, progressive companies focus on improving the efficiency of business operations which can reduce costs permanently. This strategy eliminates the scramble to rehire in post-recession economies as demand begins to rise and emerge with fast growing profits beating out competitors.
Many companies are taking advantage of robotic process automation (RPA) to bring more recession-proof automation solutions into their organization. While traditional outsourced work solutions are able to reduce costs and free up local staff, the impact of the recent Coronavirus has highlighted more limitations and inefficiencies.
Considering RPA and traditionally outsourced work, RPA produces results faster, more efficiently, and at lower costs for companies. Additionally, RPA is a recession-proof solution as it can operate the same functions no matter the economic conditions. Businesses that do well in recession have leadership that hold steady to the path of long-term growth and profits and don’t hurry to downsize their workforces drastically. With automation and technologies like RPA, companies are able to perform better than their strictly defensive-minded competition by downsizing at a lower rate, improving efficiency of their operations, and setting the foundation to flourish in the post-recession economy to follow.
The 4th Industrial Revolution (4IR): Robotic Process Automation
Robotic process automation has been coined the 4th Industrial Revolution as early as 2017 and has proven a great enhancement for businesses of all industries. Whether in times of economic downturn or increased volumes of business, RPA can enhance operational efficiency and lower costs to provide more profits and productivity. Changing the way businesses function, RPA improves business operation efficiency and human employee efficiency.
RPA is to a company, as a tractor is to a farmer. As a tool, RPA and tractors improve worker efficiency, offer new implementations of other technologies to enhance that improvement, and allow the human worker to spend less time on repetitive tasks affording them the time to plan and strategize. In this analogy, the employee, the customer, and the business as a whole benefit largely to the implementation of the new technology solution. RPA offers these benefits to any industry and can revolutionize the way business tasks are performed.
RPA and COVID-19
In times of economic uncertainty or recession, such as this year’s Coronavirus pandemic, RPA is a solution that enables companies around the world to fair much better and strategize for future improvements and profits. A large reason RPA is so impactful during economic downturns is it offers companies the ability to continue to perform their automated tasks uninterrupted and adhere to schedules without the impact such situations have the human workforce.
An implemented RPA solution is available at any time to complete any task assigned to it while being quicker and less error-prone. It does not replace human employees but offers them the ability to focus on strategizing and identifying operational efficiency improvements to improve the business’ future success in a post-recession economy.
Can Your Business Benefit from RPA in the Face of Recession?
Facing the impact of the recent COVID-19 outbreak has been a challenge for companies across the world. With profit margins slimming and businesses reducing staff sizes, it is easy to take the approach of downsizing and limiting expenditures across operations. Yet, the studies mentioned previously point at business optimization through automation technologies like RPA.
RPA brings a permanent improvement to operational efficiency which enables employees and managers to focus on expanding and growing as the post-recession economy is established. Nitco Inc and other leading RPA specialist companies can offer stability and optimization to companies across all industries reducing the hours spent on simple tasks which hold back high-level planning and strategies that can bolster profits in the near future.
Allow our RPA solutions to improve your business operations and free employees to focus on more impactful work. Contact Nitco Inc today and allow our specialized teams to transform your business into a more efficient and resilient competitor in your industry by implementing RPA solutions into your company.