Without a trusted advisor, small businesses miss out


Running a small business is like climbing Mount Everest: it’s challenging, sometimes conviction is the only thing creating upward momentum and the reward of reaching your goal is the ultimate payoff. Oh, and the right partner guiding your journey makes all the difference to success.

This last point is one of the dilemmas that keep those that own or run a small business awake at night. With limited staff and budgets, it’s tempting to shoulder as many burdens as possible. But at a certain point, trying to be your own expert in everything from marketing to HR to technology becomes false economy. Theoretically you could also save money by cutting your own hair, but it often takes twice as long and, unless it’s something very straightforward, the results are never as a good as you’d like.

Many small businesses in Australia still take a cut-their-own-hair approach for IT investment. This is a hangover from the days when it supported business functions, serving a glorified calculator to balance the books. But whether you are a sole-trader making custom surfboards or a small team of accountants, IT now plays a central role in how you reach, communicate with and service your customers.

So it’s alarming that according to the Australian Bureau of Statistics, as recently as 2015, just over half (51 per cent) of all businesses did not have a web presence and two-thirds (66 per cent) did not have a social media presence. The smaller the business, the less likely they were to have what surely must be considered the bare minimum of IT use these days.

Small business matters

A lot rides on small businesses. They account for nine out of 10 businesses in Australia. These 2.17 million businesses employ 40 per cent of the workforce and account for a third of our GDP. The idea that we are a nation of small businesses is not just a cute slogan, it’s a fact.

But these businesses are often held back by their technology. Modelling from PwC suggests that making better use of mobile and internet technologies alone could unlock $49.2 billion worth of untapped economic potential over a decade, with around half of that in rural and regional Australia. Given the challenges that these parts of the country face as industries change and evolve, this is an opportunity we don’t want to miss.

It’s not that small businesses and midmarket companies don’t know that they need digital technologies. Broadly, they are aware that it is changing their industry and that there are plenty of compelling reasons to adopt, such as competitive advantage, scalability, agility, cost-saving and attracting and retaining the right employees.

The problem is that many small to medium sized businesses don’t know where to start. The fact is, the passion driving their business is wanting to share delicious cakes or design and build a family’s dream home, not implementing a digital transformation in order to create a mobile and agile customer-focused experience.

Despite this lack of knowledge many smaller businesses are unwilling or unable to invest in getting the help they need. Research in the US suggests that around two-thirds of small businesses take a DIY approach to IT, even though a third of businesses have no IT support at all. The picture is not much different in Australia.

Finding the right path

This leaves many businesses postponing making any decisions because it’s all too hard, which means they’re missing opportunities and risking being left behind. Or without the knowledge to make the right choice, invest in costly bells and whistles, or leave themselves vulnerable to problems such as security risks.

With digital technology now deeply entwined in every aspect of the business, it’s not just buying the tech, but implementing and supporting it to keep the business running. The good news is that technology has become more vital, it’s also more accessible. For proof of this, look at the cloud. There are many benefits of the cloud for businesses of all sizes, but for the smaller ones, it provides access to the sort of functionality that was once only available at an enterprise level business, as needed and affordably.

Similarly, there are now a host of ways for small businesses to develop more of a partnership with their technology providers to get the service they need when they don’t necessarily have the requirements to hire full-time IT staff. Companies that offer technically-focused support not only keep the systems running, but also optimise a small business’ tech investment and helps map out a digital path.

Given the different channels from video, to social media and email, that can augment communication, small businesses can access advice, education and support in between their bigger conversations about technology without requiring an investment they can’t afford.

The cost of doing anything else can be too high. According to the ABS, only 13 per cent of businesses with less than four employees see an improved performance after an IT investment. This jumps to 23 per cent for businesses under 20 employees, but it’s still a long way behind the 43 per cent of businesses with more than 200 employees.

Clearly, we need to build partnerships that make technology a worthwhile investment for small businesses so they can continue to build Australia.


About the author

Sarah Calder, Small Business Lead, Dell Australia and New Zealand.