Human Factors and Their Impact on SMEs

Kevin Gilroy

Technology has changed many things for SMEs, including the way they address personnel Man flipping over open sign in cafeneeds, management focus, and company culture. There’s no doubt – in today’s technology-dependent global economy, human factors remain critical to success for SMEs. Yet, while investing wisely in technology and using it effectively enables SMEs to compete successfully against rivals of all sizes, the human factor challenges can be daunting.

Consider these findings from the Oxford Economics research, SMEs: Equipped to Compete:

  • 39% of the survey respondents find it increasingly hard to hire skilled workers to match business needs
  • Nearly one-third of SMEs cite challenges getting employees to use mobile solutions
  • 28% cite rising labor costs as a major concern.

While SMEs are acknowledging these challenges, they are clearly not deterred by them. More than half of the 2,100 survey respondents said that driving innovation is an important strategic priority. On top of that, 35% of respondents cited the need to create a culture of innovation to achieve long-term, sustainable growth. Less than one-third said they lack the technology capabilities of larger competitors. And barely 25% reported that they struggle to understand how technology can create measurable benefits for their firm.

But, SMEs grapple with cultural challenges, particularly in the areas of social media, mobile technology, and cloud computing. To some degree, adoption of cloud computing is hindered by a lack of organizational understanding of the benefits and employees’ unwillingness to cede control of IT systems. And, despite the fact that almost half of the survey respondents expect enterprise mobility to provide strong competitive advantages and revenue gains, a third are finding it tough to get employees to use mobile solutions.

Even with these concerns, the SME culture is bullish on technology. 56% state they are more innovative – and 58% say more nimble – than key competitors, accounting for the finding that the most profitable SMEs are more likely than their less-profitable peers to be early adopters of technology.

An essential human factor highlighted in the research is the importance of leadership in times of change. To this point, over 60% say their senior management is equipped to drive the business forward successfully. Zensar Technologies, a provider of business process outsourcing and IT services in Asia, Europe, and the US, is seeing its commitment to ongoing training and employee engagement pay off. As CEO Ganesh Natarajan stated in the Oxford Economics study, “In an industry where the attrition levels can range from the high teens to 50%, our company has been able to keep attrition down below 10%. Motivating people becomes the most critical aspect of managing the human work force.”

Technology can be truly transformative for SMEs, but only when it’s backed up by leaders who possess both the vision for the business evolution and the drive to execute the vision. Such leadership characteristics coupled with the ability to communicate the vision passionately is what distinguishes managers who force change from leaders that motivate a workforce to embrace a culture of innovation and achieve meaningful business transformation.

What are the human factor challenges your business is wrestling with?  How are they impacting technology adoption in your company?  Take a look at the Human Factor infographic, or visit our SME Community Experts Web site to read more on this topic or other topics in the Equipped to Compete blog series.