At the same time, a high proportion of these companies are planning to invest more in updating existing hardware and software rather than buying into new technology.
In doing so, these businesses risk ignoring the kind of newer technologies and trends that arguably favour smaller companies, such as mobile and the cloud; for instance, the cloud lowers the cost of having to spend money on expensive servers, not to mention the cost of storing them. Indeed, the owners and managers of these SMBs recognise that cloud, mobile and big data will be the technologies most likely to have the greatest positive impact on their business in the next 12 months – raising a further question about their instinct to play it safe.
One explanation for this caution to come out of the research is a resistance to change – voted the top barrier to these smaller companies making organisational improvement. Another is a lack of technology skills and know-how. A lot of micro companies, in particular, are unlikely to have any dedicated internal IT employee whatsoever, relying on external providers for IT assistance. Overcoming these obstacles should be high on every manager's agenda, as new and transformative technology increases in strategic importance.
Besides the operational benefits, a less obvious motivation for IT and technology investment is the role it can play in recruiting and retaining talent. Employers large and small – particularly those in the service sector - should not underestimate the draw of technology to the next generation of mobile-orientated workers.
According to a new report from PwC, the job aspirations of the so-called millennial generation (those born between 1980 and 1995) are now less focussed on fat pay cheques and more interested in intangible benefits like flexible working. To provide this flexibility the report advises all companies to accelerate the integration of technology in the workplace: "To millennials this is an absolute must—they expect to have access to the best tools for collaboration and execution."
Here is where small businesses can steal a march on their larger rivals. Even if new technologies are currently of secondary concern at least these SMBs are showing a willingness to invest in technology upgrades (tellingly a majority of SMBs in the EIU research don't think that technology is too expensive or changes too fast). Meanwhile at many larger organisations the sheer cost of company-wide IT upgrades explains why old systems are rolled over and existing problems patched up.
From own experience, moving from a large organisation to a small business can sometimes feel like skipping forward a few years at school. Moving the other way – from a small company back to a large – can be like going back in time: being tied to a desk, placed in front of an immobile PC and expected to thump away on an old fashioned red-ribbon typewriter; all the while relearning how to use software from the turn of the century (or at least 2003). Such experiences quickly encourage a sense of longing for a simple IT upgrade, which (sadly) borders on excitement.
The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of The Economist Intelligence Unit Limited (EIU) or any other member of The Economist Group. The Economist Group (including the EIU) cannot accept any responsibility or liability for reliance by any person on this article or any of the information, opinions or conclusions set out in the article.
