The Impact of Technology on Business

July 28, 2014 Customers, Technology, The Manager's Resource Handbook

How Can Technology Help (Or Hurt) Your Customers?

As I waited for my flight to Amsterdam today, I grabbed a bite to eat at the nearby café. It was a late afternoon flight that would get me in around 7PM – just enough time to get dinner with an old friend, who was to pick me up at the airport. The flight was set to leave at 4:30PM local. At 4PM, however, the gate representative said that there was a mechanical problem that would require the plane be taken out of service and the flight would be cancelled. ‘We will have to rebook you,’ she said. It was at that moment when I saw the effect technology had on modern business, and how vital it was for companies to recognize the effect technology can have on customers. Here are 3 examples of the impact of technology on customers.

Example 1: Saving Your Customers’ Time (and Your Money)

After my flight cancellation was announced, I watched as people rushed to line up single-file to talk to the desk agent to get rebooked. But then, the technology phenomenon occurred: after they lined up, just about everyone reached into their pockets and grabbed a cell phone. Some, it appeared, were checking their email. Others, as I saw, started texting their friends to let the know of the change. And then there were still others, who just called the airline trying to rebook in less time than the time they would wait to get to the desk. I was part of the last group, and used the auto-rebooking by phone feature offered by the airline.

One by one, though, passengers dropped out of line before getting to the desk, saying ‘I got booked on the next flight’ to the next person. The more triumphant passengers said ‘Oh no, I didn’t call. I did it through the airline’s App.’ Regardless, passenger names began to appear on a television monitor at the next gate under ‘Awaiting Seat Assignment.’

Technology has certainly changed the way businesses work. The agents at this airline gate desk likely saw 50% fewer passengers for rebooking when compared with an identical situation 20 years ago, because passengers were able to rebook themselves. That represents less stress on the employees, as well as less cost on the business since the rebooked passengers were able to quickly scatter to catch other flights. Every rebooked passenger meant one less overnight kit, or hotel stay, courtesy of the airline. In this example, the airline’s App and auto-rebooking service helped reduce the number of stranded passengers.

Example 2: Teeth and Technology

In another example of technology and business, I recently tried a new dentist, whose website is something like ‘my teeth technology .com.’ They’re teeth. What exactly does technology do for you? I admit that I was impressed by the office – the dentist had all sort of gadgets and tools I had never seen before. ‘Sonic cavity scan’ or something like that? What happened to x-ray? Further, as I sat in the chair, I watched a flat screen TV on the ceiling show me the day’s news throughout the appointment. While the overall experience itself was pleasant, the twist came at the end in the form of the bill, which was twice the cost of what I had incurred at my prior dentist. I attributed the high price of the visit to the sonic cavity detection, and a bunch of fancy flat screens. My prior dentist didn’t have all the fancy gadgets in the office, but the medical service was of an equal quality.

In this second example, we are left with a question: is having the most advanced technology – and passing on the associated cost to customers – the best approach? In some cases, maybe it is. Is other cases – like a dentist’s office – maybe it is not. I’m not sure I would go back to this dentist because the cost was so high, and the medical service (which I actually care about) was the same as my prior dentist. Mind you, I’m not saying technology is bad. However, as business leaders, it is important to understand how technology impacts your customers.

Example 3: Slow Boat to the 21^st Century

My wife and I recently remodeled our kitchen. My wife, who loves to cook, was the decorator, and picked out the paint colors, counter top and tile color for her new ‘workshop.’ When she finally settled on a tile color, she found the supplier on the internet. As it turned out, though, they did not accept orders via email. Further, while they had a website, they had no email address, nor a way to order online. I recall the look on my wife’s face when she told me “I had to call and place an order. And they are going to send a receipt by mail. I just hope it’s the right tile that shows up, and that they wrote the address down correctly.” She then asked “It’s an expensive purchase. Should I have gone with someone else, even if they were more expensive?” Fortunately, a letter showed up in our post box with a handwritten label about a week later. It was the receipt. A few days later, another package arrived. This time, it was 40 kgs of tile – the very type we had ordered.

In this example, while things worked out for us, the buying experience was completely different from what we expected because the supplier was far behind modern e-commerce technology. As a result, we did seriously consider finding a different supplier of the tile because we were uncomfortable making such a large (and important) purchase with limited guarantees of accuracy until a heavy crate showed up. We ended up making a purchase, but how many other potential customers walked away?

Adapt or Avoid? Think About The Customer Experience

Technology, like it or not, is important to business. It can help businesses, as with the case of my rebooked flight and maybe with the dentist if you’re willing to pay more. And it can hurt businesses, as was the case with the supplier of my kitchen tile and their unwillingness to adapt. While being at the most cutting edge of technology may not be necessary, willingness to embrace even the basics can go a long way. It is clear and understood that not everyone loves or embraces technology at the same pace. But it is important to assess your business periodically to understand how you look at the use of technology.

How Does Technology Influence Your Business?

Can it help your employees? Can it reduce your costs? Can technology make you more competitive? Are you competitors or customers expecting for something you are not offering? The most important question of all, though, is how does your use (or lack of use) of technology help (or hurt) your customer’s experience?

Technology has done some great things for society, and will no doubt bring about amazing possibilities in the future. And while it will help some firms accelerate, it will also leave others in the dust. So we ask, what are you doing about changing technology and it’s affect on your organization? Leave a comment and share!