Helping your SME to thrive in the digital age: Dodging pitfalls

Managing a small or medium-sized business (SME) in today’s fast-paced world, dealing with the fallout of a global pandemic, ongoing skills gaps, and a relentless financial downturn, leaves you feeling inundated. 

Everywhere you look, there’s talk about the digital age’s potential and how it can substantially improve your business. Yet keeping pace with the rapid technological advancements is a task in itself. 

However, in order to fulfil the evolving requirements and desires of tech-inclined customers, secure and retain a talented workforce, and outpace your rivals, you’ll need to transform your business and embrace the digital age. 

Dodging pitfalls 

SMEs often make the same common mistakes during digital transformation. We tackle in this in more detail in our Essential Guide to Digital Transformation but if you’re looking for the bare bones of it, here are the ten pitfalls along with some handy tips to help you sidestep them: 

1. Analysis paralysis: Planning is essential, but planning digital transformations too far in advance can cause you to overthink everything and end up in a vicious cycle. While having a long-term vision is essential, SMEs should focus on achieving short-term goals and making incremental improvements using a lean startup mindset, wherein you make refinements in response to customer feedback.  

1. Being blind to your data: SMEs frequently fail to gather and learn from valuable information. Modern data management is crucial for business success. If you’re collecting data, mine it for insights and turn it into something that benefits your digital transformation efforts. For instance, customers’ habits and shopping preferences should be taken into consideration when planning digital innovations.  

1. Working toward vague goals: Too many SMEs start with ill-defined aims and haphazard goals. Without clear objectives and key performance indicators (KPIs), you can end up investing in the wrong technology. You can avoid this mistake by developing and articulating a comprehensive strategy with specific, measurable, achievable, relevant, and time-bound (SMART) goals.  

1. Striving for unrealistic milestones and deadlines: Digital transition is an ongoing journey, not a race to the finish line. Being aggressively ambitious and creating concrete, inflexible deadlines to accomplish milestones will only result in disappointment and backlash. Keeping transformations on track relies on realistic timelines that clearly break down deliverables into manageable steps that don’t overburden or overwhelm those responsible. 

1. Overlooking staff training: SMEs often neglect the importance of training staff to handle new digital tools and processes. Just because they’ve used legacy tech doesn’t mean they’ll pick up where they left off. Assuming your workers know how to use technology is a sure-fire way to fail. Upskilling your workforce—beyond a quick demo or short introductory session—involves well-structured training programmes and plenty of on-demand resources that set them up for future success.  

1. Failing to secure stakeholder buy-in: All too often, businesses dictate changes from the top down, telling employees how great a new system will be and how much easier it’ll make their jobs without ever having worked on the ‘shop floor’. Effective digital transformation requires involvement and buy-in from the entire workforce from the planning stages to implementation and beyond. Asking for input and explaining the reasons for transformations gets everyone on the same page and builds enthusiasm.  

1. Lack of leadership support: Digital initiatives often fail because top managers aren’t engaged or committed. Transformation is adopted across an organisation, so everyone must be on board with the changes. Employee motivation suffers if leaders don’t communicate a shared vision of success or demonstrate their enthusiasm. Akin to stakeholder buy-in, successful digital transformation relies on everyone pulling in the same direction.  

1. Leaving customers behind: It is understandable to get swept away by digital technologies’ transformative powers. But failing to consider your end-to-end customer journey is a massive no-no. We’ve all heard of examples of customer backlash against service innovations leading to walk backs. Allied Irish Banks (AIB), for example, had to scrap its plans for cashless branches after it was criticised for being tone-deaf to its customers’ needs.  

1. A lack of necessary skills: Many SMEs succumb to the mistake of relying on existing employees to plan and oversee digital transformations. While a person may be tech-savvy or have been involved in other digitalisation efforts, assuming they have the right capabilities, tools, and personnel for the job is an error. State-of-the-art digital transformations—ones that future-proof businesses—require specialist partners with expertise and experience.  

1. Penny pinching or cutting corners: Budget constraints mean SMEs often seek quick or cheap solutions. However, adopting a short-term outlook regarding budgets is almost always a false economy. Bringing in external expert partners to manage digital transformations may require a significant initial outlay. But, not bringing them in can end up costing more in the long run through downtime, loss of business, poor customer service, and potential sanctions for failed regulatory compliance. 

Why bother? 

The effort to embrace digital transformation is worthwhile, and the benefits are self-evident. For starters, you’ll conserve time and resources as digitalisation reduces operational expenses, waste, and inefficiencies. Moreover, the corresponding enhancement of your processes, workflows, and outputs will increase productivity and quality. 

Offering superior products, services, and experiences will boost customer satisfaction and loyalty. You’ll be able to experiment with novel ideas, solutions, and possibilities to stimulate innovation and creativity. Ultimately, your journey through the digital landscape will provide you with a competitive advantage and market share by setting you apart from competitors and catering to your specific customer needs. 

However, a journey as monumental as digital transformation is never easy. SMEs must navigate through a sea of potential obstacles. By being aware of and avoiding these common pitfalls, you’ll be better equipped to make informed decisions and effectively reach your digital destination. 

For more tips and insights into how to make your digital transformation as success, download our Essential Guide to Digital Transformation for SMEs