Day by day, business is becoming increasingly digital. Within small and midsize businesses (SMBs), digital technology is accelerating finance cycle times, presenting instant insight into business data, and improving strategic decisions. It’s leveling the playing field among competitors on a global scale. In my experience, SMBs that embrace digital innovation are in a better position to adapt to an ever-changing business reality. Those that remain mired in traditional processes risk losing market share to their more agile competitors.
As a finance leader of an SMB, how can you help the business get on the right side of the digital divide? My best advice is to work with the organization to recognize the urgency and value of digital transformation.
Overcoming the obstacles
Among the many hats you wear, strategic adviser is one of them. You have insight into the market, the competition, company finances, and resources. You’re in a unique role to influence how aggressively your company pursues digital transformation, and you can weigh the pros and cons of pursuing innovation like no one else in the organization.
For startups, the decision to take a digital approach to business is a natural choice. There are few restrictions by way of an existing infrastructure to hinder your efforts. My experience with established businesses is that the desire to transform to a more digitized business may be clear, but the path to get there may be laden with obstacles that must be overcome.
What I consistently hear is that SMB leaders are caught up in day-to-day operational tasks. Even tech-savvy millennials who are taking over a business for their parents and grandparents often fail to prioritize the need for digital transformation. I believe that mindset needs to change, especially if the business is striving to be more competitive in the global marketplace.
Encouraging innovation at a national level
Singapore Finance Minister Heng Swee Keat recently addressed the digitization of business in his Budget 2017 statement. A strong tenet of this statement focused on the need for companies to be able to use digital technology and embrace innovation to stay competitive and grow. To support this effort, the Singapore government has budgeted S$80 million to help SMBs go digital and has launched the Go Digital Programme to help companies build digital capabilities.
My point is this: the business world is quickly moving toward digitization. Rather than sit on the decision to pursue digital technologies, it’s time for action.
Changing minds by seeing value
A willingness to prioritize digital transformation requires a change in mindset, and that only comes from seeing the value in digital innovation. I find that many SMBs fear they can’t afford the cost of growing the business, whether that’s investing in technology or adding people to staff the business. But as technology becomes more affordable and accessible, the barriers to entry are lowering.
Cloud technology is one of the fastest, easiest, and least expensive IT environments to establish and run. And it enables automation so you can grow your business without adding people. My experience with digital technology is that it enables more timely and actionable insights to aid decision making and frees people to collaborate and play a more expansive role in the business. I believe it can have the same impact on your business.
Traversing the digital divide
From new entrants that are going straight to digital to established businesses making the leap across the digital divide, digital technologies allow SMBs to compete in a changing market reality. They’re enabling more efficient business processes and achieving better engagement with customers, employees, and partners. And this is just the beginning.
As digital technologies gain even more traction among SMBs – on which side of the divide will your business be?
To learn how your business can embrace the promise of the digital economy, check out CFO Research’s report “Embracing the Promise of a Digital Economy.” CFO Research surveyed more than 1,000 finance leaders in small and midsize organizations around the world for key insights into the ways these executives are transforming their departments to address their companies’ changing needs.