Technological innovations are helping businesses in every industry improve their customer experience and gain an edge over the competition. Adopting new technology is no longer a choice for most business owners, as being an early adopter can mean the difference between surviving and thriving. So why are so many small businesses slow to adopt new technology?
Adoption rates of new tech in large enterprises are up to 10 times higher than in small businesses, depending on the industry. While large companies have more resources and manpower to earmark for new technology, it does not seem to account for the difference between small and large businesses being so great. According to a 2018 survey by AT&T, 75% of small businessowners are eager to embrace new technology, but 38% of those surveyed are categorized as late adopters. So what gives? Here are 3 reasons why small business owners may be late to the party.
For most, this is likely the largest hurdle to overcome. Small businesses often run on small budgets, and many small business owners are not willing to invest in new tech unless the benefits are proven. Peter Tsai, a senior technology analyst states, “…small businesses aren’t increasing IT budgets at the same rate as large enterprises, they’re focusing their limited resources on more immediate concerns, such as refreshing aging and potentially out-of-support infrastructure, software, and services.” However, using this strategy means your business is always playing catch up. Fortune favors the bold, not the risk averse. The decision to adopt new technology must be carefully mulled over, but the right opportunity could increase employee productivity, speed to market, and ultimately, profit margins.
Recentstudies show that most late adopters list cost as the largest barrier to adoption, but that the second largest complaint (16%) is integration. Just the word ‘integration’ can trigger thoughts of delays, hidden costs, and internal training. These are concerns for businesses of any size, but delays and retraining can have a much larger effect on a small business. Still, the short-term pain is often worth the long-term gain of improving a critical aspect of operations. There are also opportunities to take advantage of new technological developments that don’t require any heavy lifting. The Internet has enabled many small businesses to improve their operations through relatively seamless online platforms, such as website design (i.e. Wix), social media management (i.e. Buffer), or our very own B2B payment platform for small businesses, Ablii.
Today, technology is changing at such a fast rate that some small business owners simply do not know what new products are available in market as they don’t gain enough exposure to make an educated decision. Dominic Perks, co-founder of the venture capital firm, Hambro Perks, believes there is a bit of a spiral effect in place, where small businesses engage less with technology, thus, owners have less exposure to what innovations are in the market. Overall, this makes it more difficult to make a decision on what tech works best for them. “There are lots of SME owners that simply have not had technology in their working lives; they just don’t ‘know’ tech, and what is possible.”
Breaking the cycle of limited exposure is never easy, but small business owners must start somewhere. Beginning the search by casting a wide net, and then narrowing the scope by understanding the industry, business operations, and customer needs can help an owner navigate the sea of options. Only then, can owners make a decision on what aspects of the business need improving most, whether it’s via project management, online payments, or digital advertising.
Fortune favors the bold
Adopting new technology is never easy, but then again, neither is running a small business. There is always the risk of making the wrong decision, but even worse is making no decision at all. By being strategic in improving specific processes, staying connected within the industry, and being timely, small business owners can gain an edge on the competition. The small business owner should not underestimate the power of the ‘first mover advantage’. Make the right first moves, and you may not be a small business much longer.
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