ANZ’s latest insights report, The Digital Economy: transforming Australian businesses, shows business owners have much to gain by employing a range of digital solutions - including an implied collective revenue boost of $A385 billion per year and around 22 million hours of effort saved each week.
"Business owners are overwhelmed by the breadth and complexity of the digital solutions available.”
SMEs do understand the value of digital solutions, particularly their potential to address significant pain points by taking care of mundane, repetitive tasks and providing insight and direction via a deeper understanding of customer behaviour.
However regardless of size or industry, business owners are overwhelmed by the breadth and complexity of the digital solutions available which unfortunately means the majority are opting out altogether.
The research identified four distinct mindsets among business owners which correlate with the value placed on digital tools and how they’re currently used within a business.
More than half of the businesses surveyed are tentative or dismissive in their use of digital technologies and are yet to see any major paybacks.
Mindset impacts the bottom line. We know dismissive or tentative businesses have the lowest average revenue per employee and the lowest average revenue boosts when using digital tools.
By contrast, business owners which are confident or advanced are reaping both employee productivity and revenue benefits.
Shifting the dial
Digital strategy should no longer be viewed in isolation. It has the potential to touch every part of a business.
Successful implementation requires an examination of processes and procedures, internal culture, employee engagement and business goals.
Business owners are experts at their business but this doesn’t mean they need to be the digital experts as well. Seeking professional assistance or networking with other business owners are important ways of bringing a digital strategy to fruition.
It’s not all opportunity
As businesses become more established they often become better-aware of the risks and possibilities of a cyberattack. However according to ANZ’s report, over half of businesses still have little or no knowledge of cybersecurity or cyberattacks.
The average financial impact of a cyber-attack was found to be almost $A3,000 but in many instances this figure can be much higher.
Of particular concern is Business Email Compromise (BEC) which is on the rise in Australia. BEC increased more than 230 per cent between the 2016 and 2017 financial years, and accumulating business losses of over $A22 million during that period.
For many businesses a cyber incident could well prove fatal. SMEs must look for ways to protect themselves against the growing instances of cyber-attacks and educate their employees. This should form a key component of a digital strategy.
As the engine room of Australia’s economy it’s vital that the country’s SMEs continue to look for ways to improve the operational and financial performance of their organisations.
This will largely depend on their ability to effectively embed a culture and strategy that aligns with both the emerging opportunities and challenges created by an increasingly digital economy.
Isaac Rankin is General Manager Business Banking at ANZ