Dan Martland, head of technical testing at Edge Testing, offers his insight into the three most important technologies for SMEs in their digital transformation journeys.
We see the three main areas of change being: enabling your people to do their job, people to do their job, minimizing the time needed for non-value-adding tasks and enabling scale.
There are a whole host of productivity and collaboration tools out there, and always have been. The challenge for SMEs has been one of investment, presenting a big barrier to implementation. Modern models like SaaS mean the company only has to pay for what it needs and this helps reduce up-front costs.
Minimizing non-value tasks is also closely aligned to this, both in terms of providing support systems to handle admin such as annual leave, timesheets etc. and in minimizing the need for support staff. Now you can operate effectively with a much smaller and more focused inhouse IT team, and we also see people contracting for services such as HR and finance rather than building internal teams. Collaboration and internet connectivity is enabling this shift.
The ability to scale your organization has historically been tightly linked to human resources, at least until you hit such high scales that physical automation becomes economic. New technologies allow you to magnify the benefit that your team members can generate, be that delivering new products more quickly, increasing reach through the web and social media or supporting a greater number of clients. Automation and process efficiency are key here.
What are the key technologies driving these digital transformation projects?
The cloud underpins a lot of transformative technologies. It enables SaaS, remote working, improved collaboration and helps minimize up-front costs. It’s almost ‘business as usual’, now. It does present challenges, of course, especially in terms of reliability and security.
You need your cloud-systems to be available and performing so your people can work. If the system is down, suddenly no one can work. If it runs slowly then it can hamper efficiency and growth rather than help. We see a growing number of stories in the press about data leaks (Uber being a recent example) and there is new legislation coming into effect next year (GDPR) that will significantly increase the policing of data use and security with much higher potential fines.
Companies need to be prepared for this whether they are using the cloud or not, but the cloud does present new opportunities for failure and additional people in the chain of delivery (your host or service provider) who could cause problems whilst you will still be accountable for any leaks.
Machine learning is starting to make a difference to a great many areas. Chat bots helping take some load off of human customer service agents. Algorithms looking for meaning in the large volumes of information now available and starting to deliver on the promises of ‘big data’ that have been discussed for several years, now.
We see a shift away from team member needing to focus on the ‘hygiene factors’ within a company that keep things running but don’t actually generate direct benefits and moving towards a stronger focus on the things that do deliver value.
How will the digital transformation landscape will change business for SMEs in 2018 and beyond?
We see two big shifts in the near and medium-term future.
The first is that SMEs will increase their reach and ability to service clients. With better communications they will be able to increase awareness of their services and work with clients much further afield. Their client or customer base will go from regional to national to international. Language skills will become more important, something we are traditionally poor at in the UK.
Because you can find your audience more easily there will be a temptation to hyper-specialise in a small number of products or services. This drives efficiency of production and delivery but can stifle creativity and leaves you potentially vulnerable to radical shifts in the market should your offering fall out of favour.
Do what you do well, but always keep an eye on what is coming next and try to get ahead of that curve. Use analytics to see the trends and your human capital for creativity to make the intuitive leap to what will come next.
The second is that the skills and capabilities SMEs need to operate and generate value for their clients will change. There will be reduced need for support, logistical and low-creativity skills. Instead they will need a smaller number of more capable experts to address the logistical fields: a local expert on IT and HR, for example, who liaises with the service provider that carries out the volume of activity in these spaces.
For line-of-business, the focus will shift to creative and novel endeavors. The balance of activity will shift to creating new products and services or differentiate existing ones rather than servicing current products or clients in a ‘same again’ way.
Overall, there will be a shift towards more dynamic and agile organizations within the SME layer of the economy. The ability to capitalize on the tools we have available to us and make something novel will be a key decider in terms of which companies grow and thrive versus those that become irrelevant. As Heraclitus said, the only constant is change.