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4 Major Obstacles to Digital Adoption for SMBs

January 28, 2023

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Business is changing. You hear this refrain everywhere, from news media to trade journals to conferences to sales pitches. Cloud-based technology and customer analytics are transforming sales by helping attract new customers, improve productivity, streamline operations, and reduce costs.

The message is clear: digital sales tools are the future of business. So why do small and mid-sized enterprises get left out of the loop?

According to research, 42% of small businesses and 33% of medium-sized businesses (SMBs) are interested in or have plans to invest in digital technologies. But smaller firms like these are more vulnerable to challenges posed by digital integration, making it difficult to move forward with digital transformations.

Anyone working in tech can tell you that a problem diagnosed is a problem half-solved. Concerns like those above can be intimidating but understanding where complications can arise can give SMB decision-makers confidence in planning for and executing digital transformations.

Let's explore some of the barriers facing SMBs and options for meeting these problems head-on.

1. Underestimating the value of digital tools

By far, the biggest obstacle to digital adoption for SMBs is decision-makers’ belief that digital tools aren’t relevant to their business. According to Deloitte, 40% of small business owners believe digital tools are irrelevant, even though digital tools have proven to benefit SMBs by:

Doubling revenue per employee


Quadrupling revenue growth over a year


Increasing employment growth and retention by 3-6x


Improving employee satisfaction by 69%


Increasing access to new customers by 30%


Promoting brand awareness by 31%


Most advertising and marketing performed by cloud-based services target larger businesses for their buying power, creating a gap in understanding for smaller firms.

Researching how digital tools impact specific industries and businesses can help SMB decision-makers understand why it's important to consider digital solutions and how digital tools can improve their business processes, customer relationships, and employee satisfaction—as well as give them a significant advantage over the competition.

2. Inexperience with digital technologies

While smaller firms have gotten the message that digital technologies are the way of the future, new technology often has a learning curve. Lack of employee training is a significant obstacle in SMBs successfully adopting digital technologies. A company of 36 employees might be able to afford the up-front price of a customer relationship management (CRM) tool or a configure, price, quote (CPQ) platform, but they may not be able to devote dozens of employee work hours to training.

Employee training is what an investor might call a buy-and-hold strategy: an investment that might take a bit to grow, but which creates significantly greater profit for shareholders long-term. Training employees in digital tools can help generate significant profit, but only if businesses can afford the principal investment.

That's why it's important to find options that produce the best results with the lowest possible learning curve. SMB decision-makers should evaluate potential tools on their ease of use and estimated training time to find a good balance of functionality and usability.

3. Cost of products

Digital transformation is a 1.8-trillion-dollar industry, projected to reach $3.4 trillion in 2026. These numbers don't come out of nowhere, and smaller firms are often intimidated by the price tag associated with cloud-based solutions. Large companies have the resources to rebound after a failed implementation, but smaller companies don't have the same safety nets. This lack of confidence leads to hesitation, as small and medium-sized businesses don't want to risk making decisions that might jeopardize their livelihood.

Decision-makers can build confidence by seeking out platforms and services that offer sandboxes or free trials of their product. This allows a business to take a test drive of a product without committing financially and gives employees the opportunity to become more technically familiar with a product before full implementation. It's also worth looking into special rates for small businesses; many large providers like Salesforce offer lower rates for smaller firms based on employee headcount.

4. Difficulty choosing a starting platform

Tech proponents are big on pushing total digital transformations, some going as far as saying there's “no point” in installing a CPQ system if you don't integrate a contract lifecycle management (CLM) system simultaneously. While it's true that well-implemented end-to-end systems can significantly improve sales processes and customer experience, total digital transformations can be lengthy, costly, and can exponentially steepen learning curves.

It's better to focus on the specific parts of a business's sales cycle that need the most improvement and begin implementing solutions for those issues. Decision makers should look for pain points in their organization: do potential lead opportunities get lost in sales reps' inboxes? Have customers complained about receiving incorrect or inconsistent quotes? Does it take months to draft new contracts?

Answering questions like these can help prioritize which individual tool might be most helpful and implement that first, giving the business a leg up while they plan for more upgrades later.

Conclusion

Small and mid-sized businesses stand to gain a lot from digital sales tools and by developing a clear plan for implementation, decision-makers can significantly reduce costs while still taking advantage of modern technology.

There is tremendous innovation happening to make digital tools more accessible to smaller firms and there is no reason why a small-to-midsized business shouldn't expect easy-to-use, easy-to-implement, lower-cost of ownership solutions. By understanding the value of these solutions and planning strategically, SMBs can mitigate a lot of risk and help their business and their employees work better, faster, and easier.

Explore more ideas and see how ScaleFluidly platform products can increase your bottom line.
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