Big data is one of three key areas business management platform experts, MYOB, expect to change the way New Zealand's small-to-medium enterprises (SMEs) do business over the next five years.
But MYOB Head of Technology, Grant McIvor, says that while there is significant awareness among some SMEs of the increasing importance of big data, few really understand it and what it can do for their business.
"Our latest MYOB Technology Snapshot found, surprisingly, that while 30 per cent of SMEs say big data will change their business in the next five years, 45 per cent had no understanding or only a limited understanding of big data," McIvor says.
Big data refers to the art of data analysis gained during transactions with customers and others. Over time, big data can be used to gain significant insights into the beliefs and preferences of customers – meaning companies can tailor products and services better for customers, stimulating more sales and more profits. It can also help automate and organise existing processes so business owners have more time to spend on improving their business, rather than on the daily grind.
But McIvor says business decision makers are finding it harder to keep pace with technology trends, especially with so much change coming so rapidly – and with demands on their time.
"During the last few years, technology has become more and more the focus of business owners and the latest crisis has brought about an incredibly quick – and potentially overwhelming – introduction to many different types of software and tools," he says.
"Most business owners are extremely busy people and it's important they are able to take time to fully evaluate and understand how different technologies can assist their business – especially when you consider they will also be weighing up the investment of time and money needed to implement new technological solutions."
The other two key areas expected to change the business landscape in the next five years were improvements in connectivity – such as 5G – and cloud computing, both assets seeing heightened interest one year on from the first New Zealand Covid-19 lockdown and expected to be the biggest influence on SMEs' business in the next five years, ahead of big data.
"However, all of those things are interconnected," he says. "You can't look at one of them in isolation. When you use them, and use them all together, you give SMEs what they really need – time.
"They enable SMEs to automate things like coding transactions and other elements of running a business that may be done manually at present. Taking processes like that and having them done by reliable software allows the business owner to focus on other things, like the customer experience; enriching that is what everyone is aiming for these days.
"But the pace of change is so quick it's difficult to keep up, often SMEs have just closed the gap in their knowledge of available technology and have begun onboarding to their business when they hear about the next thing – like Big Data and AI.
"That's where the experts come in; working with someone who can bring that knowledge to your business can be a very valuable exercise."
The MYOB Technology Snapshot found local SMEs are now more reliant on technology as they adapt to new ways of working, new patterns of demand, and the ongoing risk of disruption.
In the last six months, almost half (49 per cent) of SMEs looked into new technology to help their business, continuing a trend seen in the initial response to Covid-19 in July, when 55 per cent of SMEs MYOB surveyed had started exploring new technology options.
MYOB Senior Sales Manager SME, Krissy Sadler-Bridge, says: "Looking back to MYOB's 2019 Technology Snapshot, less than a third (31 per cent) of SMEs had employees working away from the office. During the nationwide lockdown last year, the work from home rate doubled, with almost two-thirds (62 per cent) of SMEs having staff working from home.
"One year on from that first response to Covid-19 restrictions, remote working has settled into a regular pattern, with 56 per cent of local SMEs having employees work from home at least once a week and 42 per cent allowing employees to enjoy more flexible working hours.
"These trends have now cemented a lot of the adaptations local businesses made in response to the initial period of the pandemic and we anticipate more SMEs will jump on board when it comes to making these types of changes," she says.
Over the past six months, SMEs made a number of changes to the way they use technology to do business:
- More than a quarter (27 per cent) increased staff training on the use of work-from-home technology
- Just under a quarter (24 per cent) implemented digital marketing
- 14 per cent created an e-commerce website
- 10 per cent have reduced or closed their physical store space to put greater emphasis on online sales
Although the regular use of video conferencing platforms fell from the heights of lockdown (from 78 per cent in 2020 to 58 per cent in 2021), the MYOB Snapshot underscores the importance of remote collaboration tools to local SMEs. While about a third (32 per cent) used document collaboration tools in 2020, this rose to 40 per cent in 2021. The use of cloud storage has also increased, from 36 per cent in 2020 to 51 per cent in 2021.
For more information about MYOB and its cloud business management solutions for small and mid-market businesses, visit: myob.com/nz