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My mom recently told me that the handyman who maintained the aging Victorian I grew up in was struggling to hire. Of course, I assumed that his experience was a direct result of the same labor shortage that has been making headlines for restaurants and other service industries. But apparently, finding or training professionals capable of the skilled labor his business provides has been a challenge for decades.
The conversation was a timely reminder that labor shortages are nothing new, even if some industries are experiencing them for the first time in years. What *is* different is that we are seeing labor shortages before the economy has fully recovered. If labor is scarce now, a lower unemployment rate is only going to exacerbate the situation. So what should business owners and investors be thinking about, or doing, now to prepare?
Yes, I understand that the popular adage is to suggest bold new strategies that look above and beyond whatever is currently “normal” to stride confidently into a powerful new future. Said more pithily, most advisors like to guide their clients to think “outside” the box.
But my experience has been that very few businesses are actually operating at their maximum efficiency, which means that looking above and beyond is simply unnecessary. By expanding their view of a particular challenge while remaining comfortably within their current realm of operations, many businesses have the potential to accomplish far more without actually expanding the size of their teams or taking other drastic measures.
This mindset was the key driver behind most of the machine learning work I did with HERE Technologies. The news is full of stories about AI algorithms “replacing” humans but my experience has been that these algorithms are more often intended to “repurpose” the human efforts.
As a mapmaker, there was a bottomless pit of increasingly complex features that were simply unavailable because our teams were drawing lines that computers could draw better rather than solving the problems that only humans could solve. Although subtle, recognizing AI and other automation efforts as enabling an existing workforce to do more rather than as a full replacement can make a powerful difference to the overall efficiency of an operation.
Of course, many businesses operate in a physical world where machine learning may feel irrelevant. AI is still a long way from driving the truck, but there may be similar investments in machinery or even basic logistics assessments that could have a similar impact. Almost every business evolves their practices organically and only rarely takes a step back to determine whether there is a more efficient way to achieve the same ends.
Returning to the box metaphor, few businesses are actually checking every corner before dashing out in search of entirely new solutions. Labor shortages can be a significant threat to any business and the often-Quixotic search for Disruption can be tempting. But the simple truth is, most businesses have all the opportunity they need within their existing business model. The answer may very well be sitting in plain sight but no one has chosen to look. Until you have fully explored your existing model for inefficiencies, there is no need to panic and no need to go outside the box at all.