How Can Technology Solve the Labor Shortage

David Frankenberger (DF), Marketing Manager of Ellin & Tucker, recently sat down with colleagues Travis Hamburg (TH), founder and CEO of Time Capital Solutions, and Steven Graf (SG), a manager in the audit and accounting department of Ellin & Tucker. As the workforce challenges continue across virtually every industry, businesses are being negatively impacted by a lack of employees to oversee crucial tasks.  In this informative discussion, Travis and Steven share how the shortage can be partially overcome with the adoption of new technology, and they share how business owners and managers can overcome any hesitancy to utilize these new tools.

DF: Thank you both for joining me today. Steven, I would like to start with you. As an auditor at Ellin & Tucker, you’re well connected to your clients, their operations, and in some cases, their employees and families. Tell us a little bit about what you’re seeing out in the field. What’s the climate like, and what are some of the pain points c-suite individuals are facing?

SG: Well, everyone is facing the same challenge right now, and the number one thing I hear all my clients talking about is finding people. As businesses begin to adjust to changes in operations and workforce demands because of the pandemic, we’re immediately being hit by a recession. Many workers find themselves out of job, which leads many older Americans to voluntarily choose to retire and leave. Spots need to be filled at all levels, especially in back-office accounting positions.

DF: How has it been challenging for you as an auditor?

SG: Mostly, I’ve seen the impact of a reduced workforce result in delays and missed opportunities. For instance, I’ll work with clients to schedule due dates and deadlines for their various reporting needs, sometimes months in advance. We’ll check in regularly to make sure everything’s on track. Then just before the dates arrive, the client will inform me that they’ve lost their support person.  Or another administrative emergency has cropped up. Now we’ll work with them to find another date that works for both of us, which still takes time from their schedule to do. It can be difficult, especially when everyone’s up against immovable tax and bank document deadlines. I have seen people miss deadlines for various grants and or bid proposals. I’ve also witnessed businesses squeaking right up to a deadline because they’re trying to put out fire after fire, which means priorities get constantly reshuffled while trying to handle the current crisis. A business owner can only do that for so long before the running of the business suffers and they’re no longer putting their best foot forward for their relationships, customer and vendor alike. It’s exhausting and I feel for them.

DF: Travis, as a former auditor, and now, the CEO of a client accounting services firm, are you seeing similar challenges?

TH: Oh, absolutely. I see these same inefficiencies impact how a c-suite individual utilizes their time. If there’s not someone around to do a task, the responsibility usually falls on the people who are higher-up, sometimes the owner, or someone in the c-suite. Because, while these tasks may seem minor, they have a large influence on the business’ ability to run smoothly. This can’t just be ignored. The time they’re taking away from their actual duties to complete a task that’s usually completed by someone else, may not have ramifications in the short term, but that will certainly catch up to them in the long term.

DF: So, what’s the solution?

TH: While it can be a big investment financially, there are automated technologies available that can help businesses and organizations in this type of situation.

DF: Why should a client invest in automation and technology?

TH: You’re increasing your efficiency across the board. And referring to the pain point Steven mentioned, it being a tight labor market, everyone is supposed to do more with less. So, you need to think of an outside-the-box way to get the duties and responsibilities taken care of with no negative impact on the business. A business might be trying to find someone to hire for a role that could be replaced by a technology platform or an outside third-party service. The thought to consider technology for a problem like this, likely hasn’t occurred before, but it allows people to supplement the workforce without the struggle of interviewing, hiring, and training a new employee. It’s truly a reallocation of your resources, but instead of these resources being human, they’re now technology.

DF: What types of automation technologies are out there?

TH: Maybe someone’s role was to open mail, input invoices, and prepare checks. Now, those tasks could be outsourced to a third-party service, which removes the need for an employee. If you think about the early parts of the pandemic, people couldn’t access offices and access their check stocks. Not having an electronic way of managing tasks like this created even more of a disruption, which these businesses really didn’t need. The inefficiencies of the old ways of doing things came back to really haunt businesses because they didn’t have access to the tangible materials they needed while working remotely. If you have a more efficient data entry process, you can have a more efficient month-end. This solves the problem of the delays that Steven mentioned having on his end. This way, they’re not completely reliant on a person inputting this data at a time when it’s so difficult to find and hire someone for tasks such as this.

DF: Do you find there’s hesitation to invest in the technology for fear that it’s going to put people out of jobs or is the technology empowering those individuals who maybe can work more remotely or not have the ability to be in the office every day?

TH: I look at it twofold. Jobs that you would be removing are the ones you’re probably having a hard time hiring for. If you’re having a hard time hiring someone for a position, you’re not letting anyone go. You’re just reducing your need for a position. The flip side is if you already have a team in place, you’re just retooling them and shifting their responsibilities. It’s not so much them doing data entry but overseeing data entry and maybe picking up another function in the process. It’s not so much replacing roles but shifting roles so these employees can play a different part in the company and you’re maximizing the use of their talents.

SG: I agree with Travis. Most employees want the opportunity for growth in their positions, and the implementation of technology can help businesses and their leaders ensure that those opportunities are there by not bogging employees down with menial tasks.

DF: What would you say to businesses who are hesitant to adopt these new technologies?

SG: Much of this technology isn’t new anymore. It’s been stress tested to the extreme with the pandemic. A lot of these technologies, if they existed before the pandemic, are now streamlined. They’ve had the bugs worked out. They’ve been tested. You’re no longer in early adoption, you’re firmly in the middle of the pack with a lot of what is out there. And so that takes out a lot of the risk. That’s not to say there isn’t some, but a lot of the old concerns are no longer an issue.

TH: I think it comes down to understanding why you’re hesitant. Usually, it’s because there’s a cost associated with this technology and there’s a sticker shock sometimes. I think there’s a cost and time savings lens you need to think about though. Ask yourself, how can you meet today’s new staffing needs, and where could you cut back and supplement? And, like we’ve mentioned, if you can’t find someone to fill this role and complete these tasks, using technology to keep things moving is certainly better than not having anyone for that role at all, right?

DF: Any parting thoughts?

TH:  Take the time to understand where your current financial processes are and how that integrates with your budget and your operating plan. It’s very valuable because a lot of companies struggle to connect their financial information, like the results of their income statement to the non-financial side of the business. They should be asking questions like, what’s our customer turnover? What does our average monthly billing look like, and where is the relationship between the two?

SG: An additional benefit is that a lot of this technology has security built into it. With the workforce shrinking, more and more employees are forced to wear multiple hats. And that raises risks, because next thing you know, you have the same person adding new vendors to the system, writing checks, and approving checks, and that’s just asking for them to write a check to themselves. That’s one of the things we look at as auditors and one of the benefits that technology provides- allowing you to segregate tasks out a little bit better. You can put the controls in place to make sure certain people only have access to certain roles and vice-versa.