Digital transformation offers an unparalleled opportunity for small and midsize companies to get bigger, more nimble and turn the tables on much larger competitors. When everything is digitized and tracked, businesses can work directly with suppliers and customers while improving control over their business.
Adapting to a Digital Marketplace
To better understand how the digital economy is impacting companies with fewer than 1,000 employees. 3200 businesses over 11 Countries were surveyed. The study focused on whether small and midsize businesses use technology as a competitive advantage over larger companies. Among the findings:
- 49.3 percent of decision makers believe that technology levels the playing field for small businesses versus larger corporations
- 40.8 percent of respondents cite their size as an advantage over larger companies that are less able take advantage of digital innovation in a timely way
In short, being small and digital can offer distinct advantages: Not only can small businesses compete at the same level as their (sometimes much larger) adversaries; they have an opportunity to surpass them -- and raise the bar.
How Digital Transformation Makes a Difference
There is a clear connection between digital transformation and revenue growth, the IDC study found. Fast-growing small and midsize firms with more than 10 percent annual revenue growth were significantly more likely to indicate major progress towards transformation than slower growing firms
Business Living Proof , for example, knew that it would need more than science and great products to compete with international beauty brands such as AVEDA, Redken and Pureology. So it embarked upon a digital transformation, which took it from managing the business with individual spreadsheets to digitizing everything -- including finance, human resources, supply chain and production -- and all within weeks by moving to the cloud.
This investment made it easier to run the U.S.-based startup of 60 employees. And digital transformation has maximized Living Proof’s growth: The rising star in the hair-care market has increased its product portfolio by 230 percent and increased revenue by 330 percent.
Before digital technology, that kind of growth would have required significant workforce augmentation. But because its processes are so simple, real-time and insightful, Living Proof only needed to hire 30 more people.
The Secret to Thriving in the Digital Economy
It’s hard to ignore the potential of digital transformation. Every day, we hear stories of how a small or midsize business achieves “overnight success” by disrupting an entire industry.
It all starts with the digital transformation of the entire business model.