Is Digital Transformation the Answer to the Recovery of SMEs?
by James P. Outreach & PR ExecutiveSmall to medium enterprises (SMEs) are essential to the UK
economy. The government has noted that they contribute to 99.9
per cent of all private sector business in the country with a turnover of
£2 trillion.
However, entering the largest recession since records began
and even after unprecedented financial help, small firms remain at risk of
failure in navigating their business through the pandemic. The current
situation has rapidly changed the way that we interact with customers, how
consumers buy, and the interests of clients and customers alike.
Everyone has become increasingly reliant on technology in
2020, whether to contact family or to order groceries. Businesses are also
seeing the advantage of using technology to continue and progress their
business.
With the World Economic Forum predicting that the value
added by digital transformations across all sectors could be larger
than $100 billion by 2025, this key strategy may be the answer to your
business survival.
Digital transformations give business leaders the
opportunity to step back, uncover the best practice for their organisation, and
help to grow and recover their revenue. Here, we look at how a digital
transformation can help recover SMEs and the steps businesses should take to
integrate them.
The new experience for customers
Where the customer experience is at the heart of good
business practice, it is also at the centre of digital proficiency.
Improving customer experiences through digital
transformation is being adopted by leading businesses around the world. In
fact, 92 of the top 100 organisations have “mature
digital transformation strategies in place” to improve how consumers
interact with their brand. Compared to other organisations where only 22 per
cent of businesses have this strategy in place, it’s clear to see how SMEs are
falling behind.
Digital transformations needn’t be complicated. Simple
examples include the integration of an e-commerce platform on your brand’s
website. Digital transformations are about identifying problems in your current
system and finding a better way to represent the needs of your customers. The
recent national lockdown emphasised the need for businesses to adapt with
technology. For example, retail leader Primark dropped from £650 million in
monthly sales to nothing in April, but digital-first enterprises thrived.
SMEs benefit from
reactionary business and recognising the successes of businesses to follow. Digital
transformation is one way to keep ahead of the trend. 70 per cent of business
leaders recognised that their customer satisfaction increased significantly.
Technology transforming finance
Developing and affordable technology over the past five
years has opened access to digital card readers for an increasing number of
small businesses. The dramatic shift from cash payments to credit and debit
cards has been accentuated by encouragement to use electronic payments for
distancing and hygienic reasons, following the coronavirus pandemic. Card
payments are more accepted by the British public than ever, and essential for
growing businesses.
However, with a change in tender and how finances are
processed, comes extra layers of legality. For example, interchange fees are
charges for using services including Mastercard and VISA. The fee is a handling
charge, processing payments to avoid fraud, debt, and assessing risks in
accepting individual payments.
Technology opens your business to new revenue opportunities
by accepting new digital tenders, but with the transformation, you must account
for new regulation.
While
technology advances systems, processes become more complex and can become more
difficult to control and maintain. To mitigate this, companies need to ensure
they have in place a strong operations and IT team to process transformations,
an internal audit team who can influence them, and most of all, a statutory audit accountant who can challenge the purpose and
fairness of financial accounts.
Gathering data―and opportunities
It’s become a repeated concept, but a message that should
still hold true despite its obliqueness: “Data is worth more than oil.”
The comparison is a little vague, but it suggests that
learning about your customers can add profitability to your business. This
doesn’t mean selling data on. It means using the data you’ve collected to
better understand your market. Who are your customers, when do they buy, and
how they buy are all relevant questions that can be answered with precision
through data collection?
Tracking the metrics of your business allows you to
understand which strategies are most effective.
One survey on the
use of data in business showed that 49 per cent of businesses believe that
analytics are of most use in driving business decisions.
While you can understand more about your customers, digital
transformation can also indicate how your staff work. Questions including
‘Which tasks take the longest?’ and ‘Who are the most effective staff team?’
can be answered by reviewing sales and work data with digitised schedules.
Innovating with agility
Digital transformation improves agility across businesses.
It allows companies to understand when to expect change and how to efficiently
change practices to adapt with them.
Digital companies often consider how they expand their
business into relating avenues. They look at how the business can diverge from
their original mission while keeping with the culture that your business has
curated. Technology allows these new approaches to be developed alongside
extending business enterprises.
Research shows that 68 per cent of
businesses commend agility as one of the top three initiatives that businesses
can strive towards. Reflect on how your customers and staff react to
technology, does it make the business process more fulfilling and efficient.
Agile business interactions are becoming increasingly common
in the digital market. For example, the use of chatbots on social media allows a
business to track customer interaction and complete increasingly complex and
specific tasks without the need for human interaction. From banks to pizza
shops, organising your investments to ordering takeaway, businesses can benefit
from digital transformation by recognising the needs of the customer.
Technological innovation is as much as a risk to businesses
as a financial recession. The increasing capabilities of technology means that
it is difficult to predict future sector changes. A digital transformation is
the only way a business can prepare for this future of innovation, meaning that
potential developments can efficiently integrate into their business operation.
As a brand, staff and customers will recognise the attempt
to provide the best possible service through digital transformation. Research
indicating the revenue potential of digitised companies also stresses the need
to adapt to the rapidly changing times. After all, it’s not just technology
that is being changed, but society as well.
Sources
https://publications.parliament.uk/pa/cm201719/cmselect/cmbeis/807/80704.htm
http://go.nuodb.com/2016-database-report.html
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Created on Dec 18th 2020 08:18. Viewed 388 times.