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Unlocking Digital Transformation: How Small Business Can Benefit

Unlocking Digital Transformation: How Small Business Can Benefit

Digital Transformation has become a crucial aspect of business growth and success. Small businesses are crucial in the global economy, representing 90% of all businesses and contributing 60 to 70% of employment and 50% of GDP worldwide. However, their ability to recover from the COVID-19 pandemic and sustain growth depends on their ability to adapt to changing consumer behaviour. Small businesses can gain benefits from digital transformation and adapt to the digital landscape to remain competitive with larger organizations.

What is Digital Transformation?

Digital transformation refers to integrating digital technology into all areas of a business, resulting in fundamental changes to how businesses operate and deliver value to customers. This transformation involves a shift in mindset, culture, and processes, and it is not just about implementing new technologies but also about using them effectively to improve business operations.

The Organisation for Economic Cooperation and Development (OECD) reports that businesses investing in their digital futures enjoy various long-term benefits, such as improved communication and easier entry into global markets. Encouragingly, the same report also shows that up to 70% of small businesses are intensifying their use of digital technologies in response to the pandemic, indicating a growing trend of digitalization among small businesses.

Benefits of Digital Transformation for Small Businesses

Increased Efficiency and Productivity

Digital tools and technologies can automate repetitive tasks and streamline business processes, resulting in increased efficiency and productivity. For example, cloud-based software can automate invoicing, inventory management, and customer relationship management, allowing small businesses to focus on core business activities and deliver better customer experiences.

Improved Customer Experience

Digital transformation allows small businesses to enhance their customer experience by providing personalized, real-time interactions. With digital tools like chatbots, social media, and email marketing, small businesses can promptly engage with customers and meet their needs. This can boost customer satisfaction and loyalty, leading to increased sales and revenue.

According to World Economic Forum, the widespread adoption of mobile devices has made digitalization more accessible. This trend is expected to continue as the number of mobile device users is projected to increase from 6.38 billion in 2021 to 7.52 billion in 2026.

Access to New Markets

Digital transformation can help small businesses expand their reach beyond their local market by enabling them to sell their products and services online. E-commerce platforms such as Shopify, WooCommerce, and BigCommerce allow small businesses to create an online store and reach customers worldwide, opening up new revenue streams.

Moreover, the way people shop has been shifting towards online channels for years, and while brick-and-mortar stores will continue to have a role, the future of shopping is increasingly digital. Morgan Stanley predicts that the global e-commerce market will grow from $3.3 trillion in 2021 to $5.4 trillion in 2026, representing a growth rate of over 60% in just four years.

Competitive Advantage

Digital transformation can give small businesses a competitive edge by allowing them to leverage technology to improve their products, services, and operations. By using data analytics, artificial intelligence, and machine learning, small businesses can gain insights into customer behavior, market trends, and operational efficiencies, enabling them to make better business decisions.

Cost Savings

Digital transformation can help small businesses save costs by reducing the need for physical infrastructure and manual labor. For example, cloud-based solutions eliminate the need for on-premise servers and IT staff, reducing overhead costs. Additionally, digital tools can automate many tasks, reducing the need for manual labor and increasing efficiency.

Prioritizing Strategy over Technology in Digital Transformation

Introducing technology is a crucial step in digital transformation for businesses. However, businesses must align any new technology with the needs and beliefs of their customers. Most businesses prioritize multiple technologies instead of integrating the change into their overall business plan.

According to a digital business study by MIT Sloan Management Review and Deloitte, the power of digital technologies lies not in the technology itself but in how businesses incorporate it to improve their processes and operations.

Fostering a culture of digital transformation requires more than just cutting-edge technology like software and artificial intelligence. It also requires a team fully committed to accepting the change. McKinsey notes that employee resistance is the main reason why digital transitions commonly fail, with a failure rate of 70%.

To ensure a successful digital transformation, businesses must prioritize continuous training and change management at every level of deployment. Establish a weekly training schedule, keep employees updated with the latest trends and technologies, and ensure consistency throughout the approach.

Is your business ready for digital transformation? iTechSkills can help. Contact us at [email protected] to learn how we can support your workforce with personalized technology and IT skills training. Explore our course page today to discover our comprehensive training programs. Our expertise can help you unlock the full potential of your initiatives.

This article is a part of iTechSkills’s Blog Series, Unlocking Digital Transformation. As a leader in IT courses and training, iTechSkills supports businesses in their journey toward digitalization. We offer comprehensive technology and IT skills training for employees, children, senior citizens, and anyone interested in enhancing their digital skillset. 

iTechSkills’s Unlocking Digital Transformation Blog Series