Writing in the Financial Times, famed author and historian Yuval Noah Harari noted in March 2020 that pandemics fast-forward history: “Decisions that in normal times could take years of deliberation are passed in a matter of hours”. This doesn’t just affect society, but very much the world of business and technology.
Businesses have to react to survive, too – in fact, if 2020 proved something, is that adaptability and agility are now more essential than ever for small businesses. Whether it’s rapidly transforming to deal with a remote working environment or shifting from brick-and-mortar to a web store, processes that typically would have taken months to set up, needed to be realised overnight. A “new digital normal” was established as businesses responded to the COVID crisis, and it looks like it’s here to stay.
But what does this mean for SMEs going forward? And what can you as an SME do to future-proof your business?
There is a high adoption rate of digital technologies in the UK compared with its European counterparts. A 2019 KFW study found that 51% of UK SMEs considered digitisation a top priority for the next two years, but COVID-19 forced them to accelerate digitalisation plans bringing about a unique set of challenges.
These are the main challenges UK SMEs faced and some ways in which they’ve responded:
Moving online - With physical stores being forced to shut, companies had to develop a digital presence overnight to continue selling.
Digitisation - Service providers had to plan new innovative and creative ways in order to continue their services, as physical contact was greatly restricted. From online classes to doctors offering consultations via video conference or sporting and charity events moving to a virtual format.
Remote work - Working remotely has become the standard. As workers were sent home and offices were closed, businesses suddenly had to adapt to a completely new working model, and with it a set of challenges including remote communication, managing team morale from a distance, project management and accountability.
Downsizing - Minimising revenue losses involved cutting costs, including labour costs and furloughing and layoffs became part and parcel.
Ultimately, adapting in this way helped SMEs cope and continuing to readapt will prepare your SME for any future challenges.
Now more than ever, agility is paramount for SMEs. Agility is the ability to quickly and efficiently react to a situation. Building an agile organisation facilitates a swift response to market changes with the flexibility customers demand. But how can an SME become even more agile?
Agile SMEs tend to focus on building processes that boost flexibility and increase productivity. Clearly, this approach can be advantageous, particularly in times of uncertainty and change, as agile teams can react faster, often taking on other roles and responsibilities if needed.
Digitisation is a huge part of this: The right small business technology solutions – such as a Customer Relationship Management (CRM) system – support lean processes by automating the tedious, repetitive tasks and keeping all stakeholders up-to-date with crucial information. Without automation, businesses struggle to remain agile and keep up with the speed of technological growth and the exploding volume of data.
This is also true in terms of customer-centricity. Customers expect consistently excellent customer service across all brand touchpoints regardless the situation. The 2020 lockdowns amplified this: SMEs that solely relied on their brick and mortar presence or were not set with the right tools suffered severely as the crisis hit. Switching to a digital approach proved a successful strategy for many in protecting sales revenue. SMEs benefit largely from going digital to safeguard their sales against future crises.
So how can you make your that going forward your SME future-proof? In challenging times, it seems a successful strategy involves a high degree of digitalisation combined with an agile team. The following practical strategies for your SME will help you to get you on the road to becoming future-proof:
Spread the vision - When recruiting new team members, find advocates for your vision of the future and get them to spread their ideas within the team. If you hire from a future-oriented perspective, it will be easier to foster change.
Take the lead - Great leadership is a key skill for successful SMEs. Lead by example – and foster a productive company culture.
Promote reskilling and upskilling - One major challenge UK SMEs face is the ability to retain digital talent. SMEs are increasingly looking to retrain their existing employees and equip them with new skills. Consider factoring in a training budget and for example investing in learning software/apps that help your team members utilise personal interests on the job. There are many great (free) learning platforms that can be tailored to skills that are missing and help upskill your team.
Invest in the right technology - Digital tools allow your business to stay flexible in terms of reacting to new trends. Most cloud-based software suites come with automatic updates keeping you on the right side of evolving trends. Most small business technology solutions such as a CRM system use a scalable bandwidth model – perfect for changing needs.
Add digital benefits to customers - How can you continue to enrich your customers’ lives? To navigate the future, SMEs need to provide as much value as possible to consumers – think about e.g. in-store WiFi, a mobile app or other web-based digital tools. It’s time to get creative! Here are also some tips on how to maintain customer relationships while working remotely.
Foster a culture of remote collaboration - The key to remote work is communication. Whether your SME chooses to pursue a fully or partially remote model, it’s important that your employees are capable of becoming effective virtual agile teams. Encourage communication at all levels, and make sure that all team members have a voice. And establish the right small business tools to boost productivity and flexibility.
While you may face daunting challenges maintaining and growing your small or medium-sized business, remember that with every challenge comes opportunity. This is the time to pursue digital transformation and put the right technology, tools and processes in place so that your SME is ready for anything that lies ahead.
If you want to learn more about why agility and digitalisation are crucial to SMEs download our latest eBook. This guide offers many practical tips on how to future-proof your small business and how to successfully chart the business landscape going forward.