It’s not a stretch to say that tomorrow's successful small business owners will be far more reliant on technology than today's entrepreneurs. They'll be more connected in a mobile world, market to customers in ways only imagined today and blur the lines between the virtual and physical worlds Does that scare you? Have you ever been part of a coffee morning chat where someone has said ‘You know, I wish that things were the way they used to be? My mobile phone is great, but I just can’t get away from it anymore!’
The new reality is that technology doesn’t go backwards. You could argue that technology never has! When an invention or way of doing something comes along it never gets undone once its accepted as being then nor. Can you see Edison going, ‘Yeah that light-bulb is a pretty nifty thing, but I’d rather go back to burning candles.’ No, that just isn’t going to happen.
As a small business owner looking to manage their workforce there just is no sense in going back to using things that make you less efficient, or indeed less competitive. So as small business owners our new reality is that we have to get on board the technology train – or slowly watch our businesses die, or be proselyted by those that are making things easier for their customers, making their processes more efficient and offering the customer an overall better experience.
Let’s have a look at some Australian data using the employment measure of small business, there were 2,065,523 small businesses in Australia (2015) employing less than 19 people, accounting for 97 per cent of all Australian businesses by employee size. There were 51,000 medium sized businesses, employing 20 to 199 employees, which is 2.4 per cent of all firms. Only 3,700 Australian firms employed over 200 people in 2015, meaning that large businesses account for only 0.2 per cent of all Australian businesses.
Let’s look at some key areas that small businesses need to focus on to make sure that they are up with the play.
Know your market
Before you determine what product or service to sell, you need to understand your market. Find a niche area for your business to operate, and invest in market research and defining your target market.
Invest in branding
Decide what your brand stands for, and make this part of your marketing strategy. Make sure you tell the story of your brand on the platforms that your customers use to engage, such as your website, and social media.
Build a quality digital presence!
As you’ve seen from the statistics above, social media is an important channel for businesses to connect with customers. Digital channels are not just a great way to reach customers outside your geographic area, but an opportunity to creatively showcase your brand personality, and products or services.
Your business can’t, and shouldn’t do everything. Focus on doing what your business does best, and find partnerships and external resources for what you can’t. The best partnerships not only allow your business to grow, but add to the customer experience as well.
Focus on customers over costs
Customers are what will drive your business and help you to expand. It’s worth investing in a customer-first approach when your business is still starting up, rather than being too concerned about cutting overheads.
What does this future small business owner look like?
They are going to need to be agile! That’s the first thing. One of the advantages that small business owners have over their larger corporate behemoths is that they can be agile. Flat management structures mean that decisions that affect the business can and need to be made quicker.
1. Managing your workforce and customer relationships mean that you’ll need more data. If you can’t measure, then you can’t manage. You may as well be sitting at a desk in a room with no windows or doors and no way of getting any information coming in. Go and buy yourself a boat, a fishing line, and find a place to launch it – because that’s what you’ll be doing if you don’t focus on having systems that flood your office with information. Big data is coming and the geeks and number crunchers who will be using it will be able to demographically target their customers right down to the last pair of socks. Sure, Big data is already here, but from a small business owners perspective, you need to be able to plug into that big pond, and make sure that the bites you are getting are actually going to end up in your boat – and not the corporate fishing trawler.
2. You’ll be constantly connected. Some people will say they already are, but connectivity extends beyond the ability to get a signal to your phone. You’ll be constantly connected to your customer base, checking, pushing and pulling data – making sure that you’re able to compete with the fishing trawler guys.
3. You’ll be plugging into employment pools. The days of employees staying and receiving the 40-year gold watch will be a distant memory. Apps and variations of those will mean that the power of availability and employment will switch to the employee. Think the ‘Uberisation’ of the employment pool. Employees will be bidding for jobs much the same way that drivers bid for fares now. So you’ll need to look after your people more than ever. (Particularly the younger ones)
4. Protection of lines of credit will be even more valuable than they currently are. With the emergence of digital money and open banking you’ll need to make sure that your lines of credit and ability to receive and transmit payments are in place, well recognized and secure.
Make no mistake, the small business owner is not going anywhere – but the way they need to do business is, so just make sure you are on the right side of the ledger.