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2020 Small Business Digital Maturity Study
New Small Business Study Examines the Digitalization Journey Across Eight Countries
2020 Small Business Digital Maturity study conducted during the pandemic determines the readiness of small businesses to adopt key technologies, the impact of technology on driving economic growth and the opportunities and challenges they face
70 percent of small businesses surveyed are accelerating their digitalization rates to address COVID-19 challenges and the most digitally mature small businesses can respond faster to changing market conditions and grow their revenue
In the next 18 months, small businesses report they are going to invest on remote work, online sales and developing a digital strategy
To understand the maturity level of small business digitalization, IDC developed a framework that helps small businesses clearly assess their current capabilities, and understand where they are on a four-stage digital index - ranging from the earliest stage of Digital Indifferent to the most advanced group of Digital Natives. This study is an extension of the APJC SMB study released in July.
'The COVID-19 pandemic has exacerbated the digital divide that was already present in the small business market, and it is forcing companies to accelerate their digitalization,' said
Small Businesses Range When It Comes to Their Digitalization Journeys
When it comes to the four-stage digital maturity index, small businesses range with surprisingly only 25 percent surveyed in the most advanced stage (stage four) with four percent still in stage one/digital native stage.
On average, small businesses in
Comparing the eight countries, small businesses in the
When it comes to recovery during and after the pandemic, small businesses that are in the more mature stage three and four have the highest ratio of recovering, are able to respond faster to changing market conditions, and are growing their revenue at higher rates.
16 percent of those surveyed say they are thriving and feel their businesses are agile and resilient.
Conversely, 36 percent of small businesses surveyed are still in survival mode and 50 percent are focused on growing or rebuilding their business.
If 50 percent of these small businesses surveyed could advance to the third stage of the maturity index by 2024,
Small Businesses Know Technology is Key to Recovery, But It Doesn't Come Without its Share of Challenges
COVID-19 has only heightened the fact that digitalization is no longer a choice for small businesses, it's a necessity.
Of those surveyed, over 70% of worldwide small businesses are accelerating the digitalization of their businesses due to the pandemic.
While digital technologies are more widely available today and help level the playing field, small businesses face constraints on many fronts.
Working styles, employee safety, cashflow and sales are the most impacted business areas for worldwide small businesses due to the pandemic.
Additionally, the shortage of digital skills and talent, cultural resistance to change and lack of budget/commitment are key challenges for small businesses even outside of a pandemic.
Small Businesses are More Dependent on Technology and Will Be Investing in Key Areas
This crisis has made small businesses more dependent on technology and aware of the importance of digitalization.
About 45 percent of small businesses surveyed expect that over 30 percent of their business will be digital by 2021.
36 percent of small businesses are planning to invest in solutions that can help their employees work remotely, as well 33 percent will invest in digital technologies to improve online sales.
32 percent of small businesses are also planning to develop a digital strategy to with clear business goals along with 32 percent investing in talent and the right skills.
When it comes to technology investment during the next 18 months, small businesses are planning to invest in cloud solutions, as well as build on-premises infrastructure, both software and hardware.
Security is critical for small businesses considering security solutions are part of their top three priorities.
Customer experience and collaboration solutions are within the top five investment areas. The most mature small businesses are also prioritizing AI/Analytics to drive further competitiveness and reduce human intervention.
Recommendations for Small Businesses:
Small Businesses around the world are learning how to adapt to the current climate, overcome challenges and adopt technology that can help them not only survive this crisis, but thrive long after it ends. However, the first question for many is, 'where do I start?'
Develop a three-year technology road map
Prioritize the critical business processes to automate
Evaluate the right technologies to invest in -focus on empowering remote employees/workforce, a secure e-commerce platform and a robust cybersecurity network
Invest in talent and skills focused on digital
Find the right technology partner for your journey
Leverage financing and remanufactured equipment to help with cash flow and budget requirements
Keep up with industry trends and best practices
Simplify, start small, learn and scale
Additional Resources:
Learn more about the 2020 Small Business Digital Maturity Study
Check out Beyond Survival: A Small Business Resiliency Guide
See more about Cisco Designed portfolio for small businesses
Find out about Financing Options for Small Business
Follow Cisco Small Business on Twitter, Facebook and LinkedIn
About Report Methodology
The 2020 Small Business Digital Maturity Study gathered and analyzed data from over 2,000 small businesses across eight markets to assess the challenges and opportunities the companies face in their digital transformation journey and in light of COVID-19. The eight markets include,
The Small Business Digital Maturity Index is made up of four dimensions:
Four stages of digital maturity
Stage 1 - Digital Indifferent: A company that is reactive to market changes and digital efforts do not exist
Stage 2 -
Stage 3 - Digital Challenger: A company that has a strategy for the use of digital technologies and is more proactive in market responsiveness
Stage 4 - Digital Native: A company that has an integrated digitalization strategy and is focused on driving continuous innovation
About
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Release Contacts
Lindsay Kniffinpress
+1 408 527 8404 lkniffin@cisco.comSharon Vaughananalyst
+1 408 526 6174 shvaugha@cisco.com
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