Technology adoption delayed by small business

Commonwealth Bank research shows that the majority of Australian small businesses prefer to postpone the adoption of new technology into everyday operations.

The research examines three priorities through the eyes of Australian small businesses: technology, finance and work-life balance.

It reveals 80% of small businesses delay the adoption of technology offering long-term benefits, precisely because those benefits are not immediately realised. This is despite 58% of businesses claiming to have a good personal knowledge and understanding of technology.

However, it was found that 48% are reluctant to adopt new digital technology due to a lack of understanding of how it works and the potential benefits. The data suggests that small businesses are unsure about how data can enhance their business performance, with 62% not looking to use it at all.

Karen Last, general manager of small business at the Commonwealth Bank, said, “With more than half of small businesses having ready access to customer data, it is imperative small business owners understand how data analytics can help them make better informed decisions.

“A significant number of small businesses are reluctant to implement data analytics due to cost, or they believe it has limited value, or belongs in the ‘too-hard’ basket. These are all preconceptions which must be addressed so the benefits for small businesses can be realised.”

Cash flow remains another stress factor for small business owners, with half of the respondents opting to not pay themselves a wage one or more times in the past year as a result of cash-flow issues.

To mitigate the strain of cash-flow management, most small businesses rely on sending invoices to customers on time, or dipping into personal funds. Small business owners also use credit cards as their primary tool to manage cash flow, working capital and business investment.

The research further suggests that 44% of small businesses owners feel they do not spend enough time on personal wellbeing and development.

According to behavioural scientist Johann Ponnampalam, “Compromised wellbeing and stress often leads to poor decision-making, inhibits creativity and increases status quo thinking. Given these consequences, it is unsurprising that stressed out small business owners are failing to recognise the benefits offered by new digital and analytic technologies.”

The percentage of those satisfied with their work-life balance decreases as annual turnover increases, with 55% satisfied when they are earning less than $100K and 51% earning $100–$250K. However, only 47% of those earning between $250K and $1 million reported feeling satisfaction.

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