Historically, small businesses have competed successfully with larger competitors by being quicker, more productive and more responsive to customer needs … leading to higher customer satisfaction levels and retention rates. More recently, cost reductions in information and communication technologies have allowed small businesses to erase a once imposing challenge — the technical superiority of larger businesses with deeper IT pockets.
SMB Digital Transformation: Step-By-Step
Unfortunately, many small businesses have failed to recognize recent trends in technology … including the trend toward digital transformation of key business processes. Innovation and adaptation — once friendly factors for SMBs — now threatens the very existence of those who fail to respond. Big businesses are reacting en masse, gaining ground in areas once reserved for their smaller, more “nimble” competitors. Why? Because they — along with a few smaller, more “tech savvy” competitors — understand the intrinsic value of digital processes (lower costs, faster response times, improved customer loyalty). They also understand the direct impact these improvements can have on financial performance and market value.
Almost every business process can be optimized by structuring, simplifying and automating parts or all of its workflow. These processes include IT and cybersecurity management, marketing, sales, customer support, HR management, services delivery and operations. In future blog posts we’ll discuss specific examples of SMB digital transformation initiatives applied to key business functions, as well as emerging business models that can help SMBs retain or reclaim their historic advantages. In the mean time, the best way to fully understand the potential impact of digital transformation is to recognize the ten most important characteristics of a digitally-transformed process:
1. Stickiness (better customer experience)
2. Increased availability (24/7/365 service/support)
3. Self-service enhancement (DIY/decision-support tools)
4. Improved workforce utilization – (efficiency improvements within a given function)
5. Cross-function collaboration (connected teams, coordinated response to problems/opportunities)
6. External partner integration (connected partners/suppliers/processes/data)
7. Knowledge management (embedded/automated knowledge capture and sharing)
8. Real-time intelligence (via bolt on BI/analytics/sensors, etc.)
9. Streamlined workflows (automation of repetitive tasks)
10. On-demand delivery – (speed/cost benefits)
In Summary …
SMB digital transformation initiatives leverage the characteristic advantages of individual digital processes to deliver decisive speed, cost and customer satisfaction benefits vs legacy business methods. These advantages drop straight to the bottom line, improving profitability and increasing market value. Big business is catching on fast; and the success of smaller competitors, in terms of competitiveness and business valuation, will quickly follow suit.