Automation in startups: the key to scaling your business
As a startup founder, you know how difficult it can be to scale your business. You might have a great idea, but sometimes that idea doesn't hold up. For your business to grow, you need to have access to resources and know how to use the scenario to your advantage.
Startups generally don't fail with terrible ideas. In most cases, it's due to a lack of planning, resources, or execution.
According to a study by Sebrae Paraná, published by G1, in 2021 around 70% of startups closed before completing 20 months of operation, and another 50% showed no results.
The initial business structure of startups sometimes has scarce financial resources and so does the number of employees. And to overcome this lack of human and financial capital, the implementation of tools such as automation becomes fundamental.
In this article, you will understand the importance of automation, you will know how to implement it in your company, and you will understand how this technology fits so well into the routine of startups.
A technology for startups called “automation”:
Automation technology has been gaining momentum around the world as a set of technologies that make it possible to reduce costs and increase productivity. And that's why this technology has been so sought after by startups.
This type of implementation allows you to do more with less, which for a company that works with a scenario of uncertainty is something extraordinary. So you can simplify certain tasks and continue scaling without the need for additional resources.
As a result, the change in the labor and marketing scenario is already a reality. According to a projection from McKinsey, 80% of the companies stated that they will continue or increase investments with automation, and more than half of the projects heard already have four or more automation projects under development.
“In the medium term, we will see the impact of this growing on the labor market and, soon, we will have businesses that run in a scalable manner with little need for human labor to operationalize most of their processes. Which means that the future of human work belongs to creatives. The 'paper stampers' have their days numbered.” - Daniel Pereira, specialist in digital business models and author of the book Time is the Best Business
Automation contributes to significant gains, and so that you can analyze them, here are some benefits for your startup:
- Save time:
Time savings are the first notable benefit of implementing automation in your startup. Therefore, when you are able to automate processes that you execute manually, there is a considerable reduction in time in completing the tasks and it opens up a margin for you to produce more.
- Centralizes communication:
When information is scattered across multiple systems or is not up to date, there is a waste of time and resources, which creates risks of failures with the dissemination of incorrect information.
An example of this, on a daily basis, is the request of a document from a client, which in an automated process would be found in a few seconds, but in a normal process it could take minutes or even hours.
Therefore, optimizing communication in a centralized way allows, even through digitization of documents, that your startup serves customers better and wastes less time with boring processes.
- Establishes standard processes:
With automation technology, overall standardization is a much more realistic goal. You're removing potential human error, which prevents most inconsistencies from occurring.
So as a result, you don't have to deal with as many errors and problems that startups normally have to solve in the early stages of growth.
- Better use of human capital:
Automation allows companies to make better use of human capital and to give employees more engaging responsibilities. Instead of doing repetitive tasks, your employees optimize time and consequently improve productivity.
To illustrate the current importance of this resource, here is McKinsey's graph of the growth in the implementation of automation in recent years:
Automation technology gives your startup access to superior data and insights that don't always exist when you're doing something manually. And that's why I understand What is automation and how it can revolutionize your company it's so important.
Where to implement automation in your startup?
With the market growth in the startup sector, starting a business doesn't always generate great results in the first moment. However, there are some points that you need to pay attention to in order to minimize risks and generate greater opportunities.
As mentioned before, automation isn't a new thing, but it's a great chance to scale your business.
When it comes to implementing automation in a business, whether startup or not, most entrepreneurs don't know where to start. Therefore, you should ask yourself the following questions: “Where does it make the most sense for my business to integrate automation?” and “Where does my business get the most financial return?”.
Once you are able to answer these questions, the areas of greatest need for this implementation will appear. To help you out, here are examples of some areas that are interesting to automate:
Marketing:
Marketing automation, or marketing personalization, is the process of streamlining marketing activities without compromising the landscape.
In the past, this type of automation was carried out only by large companies, but with greater technological accessibility, startups have access to automation and are using this to level the market.
To find out if your startup needs to automate this area, you need to ask yourself “My startup is able to manually contact all leads”. If the answer is no, you need to simplify complex marketing processes and automation will help you make this process more measurable.
Human Resources:
One of the departments that rely most on information, documents, forms, processes, etc., is the HR department. With all these bureaucracies, this requires substantial preparation and involvement, which in many cases there isn't.
With the automation of this sector, you will have more precision and security so that no external factor compromises your document.
Additionally, you can choose to back up your data to online servers, ensuring that in the event of a fire or computer failure you won't lose years worth of important information.
Financial:
As with any company, there is a large volume of financial procedures taking place on a daily basis, and it would be no different in startups.
This sector needs to plan procedures to pay bills, issue charges, recognize receipts, etc. Therefore, because they deal with many numbers, it is an area susceptible to errors.
By implementing automation in this sector, your startup will be able to schedule payments and receipts in a scheduled manner and in volume.
How does automation make your startup more competitive?
As a good entrepreneur, you should already know that early-stage startups need to be able to move quickly and efficiently. Because, the steps taken at the beginning cannot close the doors in the future.
To obtain the maximum possible return, at a lower cost, you need to analyze the metrics, scenarios, and have a competitive market advantage.
By implementing automation, you allow for better decision-making, faster operation cycles, and greater ease of scaling in your startup.
In his book, Deep Finance , veteran startup finance expert Glenn Hopper says, “Automating parts of your process can help you scale faster. The loss of productivity from manual tasks means that it will be difficult to scale operations as the company grows. (...)”
With the large increase in the number of startups in the world, the differential will be what will make your business stand out and grow. And for this to happen correctly, you need to scan yourself.
At first it may seem difficult and daunting to implement these technologies in your business, but you just have to identify the process you want to automate, automate it, collect the data from that process and monetize it.
If the ease of this process hasn't convinced you yet, here are data from McKinsey that demonstrate the success of this implementation:
The results of this study indicate that smaller companies that automated their processes have a higher success rate than larger companies. Therefore, startups can benefit from automating their processes and growing faster in terms of productivity and business profitability.
In terms of competitiveness, it is I need to think like a startup and be ahead of market innovations. Using automation as a tool for this, means automating any process strategically to save time and money.
With streamlining of various processes, there are more results and this generates visibility and, consequently, competitiveness. This streamlining may include data entry, email management, customer service, and even accounting.
Scaling your business has never been easier, with the right tools you can take your startup to another level.
As you've seen throughout this article, automation is the technology for startups to grow. In other words, it is extremely important in the daily life of companies and in the competitive market.
If you haven't yet implemented this technology in your business, now is the time to reevaluate that decision.
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