We both know the trending state of the economy. In the Pearl of Africa, the Small and Medium Enterprises (SMEs) ranks high on the fast growing sectors, becoming one of the major employer. You would probably think this would have substantial impact however, they still face many hurdles, particularly with regards to technology.
Concomitant costs, technological change along with lack of IT expertise can have a huge blow on effects for smaller businesses. In this edition, share key ways in which SMEs may struggle when confronted with technological issues, and how they might overcome these burdens.
Technological Change and Costs
It’s no-longer news that technology changes rapidly, and therefore businesses need to keep up with technological advances to ensure the tools they are using are effective and conducive to productivity. However, at the same time, keeping up with technological advances can at-times be pricey, especially for smaller companies.
Acquiring a business software; say a human resource software is vital for everyday management functions like employee tracking, time and absence management, leave management, payments/payroll management, but it can be expensive for a small business. It’s the reason that SMEs in Uganda may struggle financially with regard to attaining the most up-to-date, feature rich software for their business. Nevertheless, acquiring an HR software is a cost that should be regarded as an investment.
Governmental policy and regulations around IT technologies can be a challenge for SMEs. These rules and regulations can change rapidly, and it can be difficult for a small business to keep up with these changes. It’s usually only meaningful that a specialized tech company is hired to manage their IT and Infrastructure services, all of which dig deeper into the SMEs’ wallet.
Glitches and Insufficient Back up
SMEs may be confronted with the challenge of glitches in technology, including the loss of important data. SMEs often do not often have an excess in working capital to spend on quality data storage, backup and protection, and therefore may face the risk of losing important data.
Although acquiring HRIS software is essential for managing HR processes, smaller companies may not have the means to attain this technology. This can have a drastic effect on the human resource processes of small businesses, leading to reduced efficiency and productivity in general.
Lack of IT Skills
Small businesses have a lot of competition when it comes to hiring employees with an adequate skill set required for solving IT issues. Larger companies have the advantage in that they can offer higher salaries and better benefits, so SMEs may have to outsource their IT staff to reduce costs.
While nearly half of small businesses outsource most or all of their technology management and support, this is not necessarily an effective way to manage IT issues. Outsourcing can be inefficient, and problems can arise when there is no one qualified in-house performing the function as the firm’s IT expert.
Improving IT with Growth
As small businesses start to become medium businesses, and perhaps look toward becoming a larger enterprise in the future, they will likely realize that the limited types of technology they once relied on are no longer adequate and even obsolete.
This will call for an update in terms of software, and acquiring modern software may become a necessity. These additional measures will obviously come at a financial cost to the firm, and may be difficult to integrate without expert help. At this stage, SMEs may need to get in touch with a technology services consultant experienced in taking businesses through this transitional period – helping out with re-aligning their business, migrating data from flat files and other data-sources and aiding them to stability.