Almost 9 out of 10 businesses in the Northern Rivers employ five or fewer people, but with more than 20,000 such businesses in the Northern Rivers, collectively they represent a large percentage of our workforce.

As we prepare to launch the Northern Rivers Digital Economy Strategy with NOROC next month, two new reports reveal the importance of small to medium enterprises embracing the digital economy; to improve not only their profitability, but for the growth of jobs and opportunities in the region.

Reinventing Australian Enterprises for the Digital Economy

IBM commissioned the National Institute of Economic and Industry Research (NIEIR) to undertake research to form a view of the future for Australian enterprises across seven key sectors: financial services, retail, telecommunications, mining, public administration, health and higher education. These sectors were chosen because they are important to our economy and because they have the power to be transformed by new technology.

This report shows that in the next 10 years significant gaps will open up between enterprises that pro-actively transform their operations for the digital age and those that don’t.

It indicates that Australia’s competitiveness will depend on getting ‘smarter’, i.e. success will be driven by how effectively enterprises can harness the power of technology and data to deliver value to customers.

In the Executive Summary, Andrew Stevens, Managing Director of IBM Australia & New Zealand says: “Enterprises must act urgently and significantly change their business models to ensure they remain successful and effective over the next decade and beyond. But this is not just about survival … those that embrace change and pursue the right strategies for this new environment – are likely to enjoy outsized gains.”

Dr Peter Brain from the NIEIR who conducted the research adds: “… it will become increasingly difficult for followers to regain their market position once they lose it to leaders that race ahead with more sophisticated customer and supply chain integration, and superior productivity. In turn, the research tells us that there is a real first-mover advantage for companies that act sooner rather than later when taking a leader position.”

More information: https://www-07.ibm.com/au/eraofsmart/index.html

Ahead of the Curve: Lessons on Technology and Growth from Small Business Leaders
This research, from Boston Consulting Group involved interviewing 4,000 SME Leaders in five nations (the US, Germany, China, India and Brazil).

The report identified three categories of SME, by their adoption of technology:

  • Tech leaders are adopting the full range of technology including VoIP (88%), smartphones (62%) social media (64%) and cloud services (100%);
  • Tech Followers are still utilising a lot of technology – but mostly for individual productivity and efficiency – 60% of all SMEs surveyed in this category had a website and 30% were using VoIP; and
  • Tech Laggards who have only basic technology if at all – only 64% have a desktop computer and less than half have the Internet (48%).

Some key findings:

  • Heavy use of technology by SMEs also leads to higher growth in revenue and jobs.
  • In developed markets, SME tech leaders are seeing more than four times the revenue growth and six times the job growth (CAGR) over tech laggard counterparts.
  • In emerging markets, SME tech leaders are seeing more than twice the revenue growth and four percentage points higher jobs growth (12% vs 16%).
  • Tech leaders are also more export-focused – with tech leaders four times more likely to have international clients than laggards in developed markets; and
  • Tech leaders are a staggering 12 times more likely than laggards to have international clients in emerging markets.

More information: https://www.bcgperspectives.com/content/articles/technology_software_globalization_ahead_curve_lessons_technology_growth_small_business_leaders/