The current human capital crisis has left businesses struggling to maintain a productive workforce. With the rising cost of labor and a shortage of talent, companies are turning to RaaS (robots as a service) and RPA (robotic process automation) to fill the gaps.
Why are companies increasingly turning to these technologies? How is RaaS being used? And what are the benefits of using bots in business?
RaaS is a sustainable answer to some of your human capital woes, but businesses do face challenges when implementing it. By the end of this article, you should have a better understanding of how it can help.
How bad is the human capital crisis?
We are all well aware of the impact COVID had across the globe. While the pandemic has abated in many regions, we are left with its residual effects, including a tremendous decline in human capital. Without an effective plan to correct this, we can expect long-term negative effects on economic growth and workforce earnings, and the window for an effective response is closing fast.
As people retire and accept promotions, opportunities open up for newer talent to fill those positions and learn from their predecessors. The problem is that there's now a shortage at both ends: there aren't enough predecessors to coach new talent, and there isn't enough new talent to relieve current professionals.
"40 million people who would have had a job in the absence of the pandemic, did not have one at the end of 2021, worsening youth unemployment trends. In multiple countries 25 percent of all young people were neither in education, employment nor training in 2021."
— World Bank Group
How, then, is work getting done?
- Ineffectively, because companies are relying on underqualified employees to fill skilled roles.
- Begrudgingly, because managers are stacking too many responsibilities on their top talent to compensate for small teams.
That isn't sustainable. RaaS is.
What is RaaS?
RaaS (robots as a service) is a business model in which bots are leased to companies across industries. These bots turn repetitive manual processes into automated ones. Tasks like scheduling, rescheduling and data compilation are generally a person's responsibility, but they are perfectly suited to bots. The knock-on benefits include lower initial investment for startups, lower scaling costs and practically no upskilling investment.
An answer to the human capital crisis
Hiring is an expensive process: scouting for talent, vetting candidates, bringing the new hire into your company and hoping they stay for the long run.
"…the average cost per hire was nearly $4,700. But many employers estimate the total cost to hire a new employee can be three to four times the position's salary…"
— Society for Human Resource Management
You also have to account for the time your current team spends on scouting and interviewing. And if the new hire leaves, you're short thousands of dollars with nothing to show for it.
Bots don't look for work, don't need to be interviewed or trained, and don't quit. That makes RaaS a strong option for startups and SMEs looking to expand their capabilities without breaking the bank.
A means to scale
To get more work done in the same amount of time, people often look to hire more talent. Not only is that costly, it isn't guaranteed to deliver the results you need. One unfortunate side effect of the pandemic is that many professionals lost the opportunity to hone their skills, leaving many job seekers with potential but not yet experience. You can bring them on anyway, because where they lack, bots can assist.
- Does your junior analyst have a hard time compiling relevant data for analysis? Leave it to a bot.
- Does your assistant struggle to schedule programs that don't overlap? Leave it to a bot.
- Is your newly promoted accountant having difficulties with month-end reports? Leave it to a bot.
Bots don't need weeks of training on a new process; they need a code update. When a malleable bot can help less experienced team members get the job done, you can take a chance on potential, and scale sustainably.
New tech for a new generation
Millennials are the new managers in large corporations and, increasingly, their own bosses. More concerned with fulfilling work than with pay alone, millennials and Gen Z are changing how businesses do business:
- They want the option to work from home.
- They expect to be paid in proportion to their value.
- They don't want to do work they don't want to do.
Younger professionals are setting boundaries, and companies will have to adapt.
"The vast majority of robotic applications are doing jobs humans don't want to do or shouldn't be doing for safety reasons."
— Forbes
Bots don't just do what some people can't do, but also what they don't want to do. That opens up more fulfilling work and makes your company more attractive to job seekers.