Small business tech: How to find the right tools to boost your business
Small businesses have a huge opportunity when it comes to using technology to overtake their larger but slower competitors.
When asked about their spending intentions, UK SMEs are three times more likely than large companies to increase their investment in technology (49% vs. 18%), according to a study by recruitment firm Nash Squared.
Bev White, chief executive at Nash Squared, says that small business owners and managers who are aware of the opportunities that digital transformation offers can now have a much greater impact on markets than ever before.
“In such a connected world, the playing field between smaller and larger companies is much more even. Both can reach a global audience of customers, employees or potential hires,” she says.
SMB Group, an analyst firm covering technology trends for small businesses, also reports great enthusiasm for IT investing. More than half (54%) of small businesses intend to increase their technology spending.
The analyst says that small businesses with a digital transformation strategy and ongoing initiatives are three times more likely to have seen revenue growth as of 2020 than those without a plan.
Many small companies are therefore already seeing positive results from digitization. These SMBs are using core technologies like the cloud to embrace and capitalize on new opportunities — and that’s critical in today’s rapidly changing global economy, says White.
“The great asset that smaller companies have is agility; the ability to change and adapt. And in a world where disruption of all kinds seems to be coming at breakneck speed, the value of agility can never be underestimated.”
Evidence suggests that many small business owners feel their innate agility gives them an advantage. Twice as many SMBs (23%) as larger companies (10%) are extremely or very effective at scaling good ideas and stopping bad ideas quickly, reports Nash Squared.
Tina McKenzie, chair of policy and advocacy at the Federation of Small Businesses, says her organization has seen clear evidence of SMB agility over the past two years.
“During COVID-19, many businesses with a physical presence adapted and created an online presence that thrived, while many individuals also started online sideline businesses that have now grown into significant businesses as people bring new ideas to the bring space to the digital world.”
Additionally, McKenzie expects this trend to continue. Small business owners have recognized the positive benefits that technology and its online platforms offer – and now they want more.
“The digital economy is crucial for small businesses – it offers a huge opportunity to reach new markets and customers,” she says.
It’s not all good news, however. Many SMEs face stiff competition, have limited resources and, perhaps most importantly, do not find it easy to invest in technologies that could help them save time and money or innovate and grow.
According to Laurie McCabe, co-founder and partner at SMB Group, small businesses looking to take advantage face tricky challenges.
“On one hand, small businesses don’t have the hierarchy and bureaucracy for decision-making, so they can definitely make quicker decisions to turn around and try something different, and then use technology to support that,” she says.
“On the other hand, they don’t have a lot of bandwidth – not just technology bandwidth, but process bandwidth. Whenever you have to make a change in a small business, it’s hard work.”
So, while many small businesses have the potential to move faster than their much larger peers, they lack the resources – both in terms of time and money – to implement a radical and effective digital transformation.
The end result of this can be jitter and lag, McCabe warns: “Often they just put off the transformation.”
Even once the decision has been made to enter the IT market, SMBs can be held back by a mismatch between internal technological know-how and external marketing power.
Small businesses, by definition, have fewer people to create or enable change. A lack of dedicated IT resources means that small business technology decisions must be intuitive, both in terms of how they are used and the return on investment they provide for the business.
Unfortunately, evidence suggests that clarity regarding use cases is hard to come by. There are so many vendors offering solutions that the potential benefits of the technology are lost in a cacophony of marketing hyperbole.
“Anything they’re selling is going to do things faster, easier, and cheaper,” says McCabe. “They’re all saying the same thing. As a small business you have to think about what’s really going to move the needle for me in the areas where I feel stuck”https://www.zdnet.com/article/small-business- tech-how-to-find-the-right-tools-to-boost-your-business/.”
So what is McCabe’s big lesson for people who run small businesses and want to take advantage of digital technology? The answer is simple: focus on the core challenges first before even thinking about possible digital solutions.
“What are the things that you need to do really well, need insight into, and need to run smoothly,” she says. “Then really focus on using technology to support those areas in your business.”
Whether it’s handling customer inquiries, improving supply chain processes, or expanding their e-commerce presence, small businesses with limited resources and multiple challenges will never be able to do it all at once.
Set a goal—like using the cloud and automation to reduce reliance on spreadsheets and paper-based processes—and make it happen.
“Really focus on what you need to do well – technology can help you do those things better, so you get them done faster. When you automate, more people can spend less time on low-value things. They can spend more time doing what they need to do to help you grow,” she says.
“And the other big benefit is that with automation, you get the information and reports you need to assess business performance and make course corrections effectively.”