Person working on iPad

Digital engagement’s role in SME success

Research indicates that the deeper the degree of digital engagement the more likely an SME is to be successful and resilient in a dynamic economy.

This article was written by Brad Rappell, CEO of Franchising1st for this Deakin University course.

Most sophisticated businesses now accept that digital transformation is no longer a maybe, that it’s already about survival. Many businesses are frozen in the headlights. They can see it around them and coming, but are baffled by the jargon, unsure of the technology, given pause by the expense and concerned about making decisions from which there’s no easy retreat.

Some are hedging their bets.

You might employ a bright young technical mind to make sense of digitisation in the context of what your own business is and does for whom. Or hope to cover all your bases current and future in one hit by spending big on any of the digital platforms that promise to do everything current and foreseeable. It could be either or both – but at least for the moment it’s off your desk.

The fundamental flaw in this is seeing digital transformation as a technical issue.

Because tech is the easy bit.

More important is divining how digital transformation might impact your business strategically, and that’s a responsibility that can’t be delegated to an in-house IT whiz or digital suite salesperson. It won’t matter how much you spend on people and programs if you end up being out-thought by your fellow CEOs – present or in the wings. It’s not something you can delegate or spend your way out of.

Inexpensive digital technology is available to anyone. Everything necessary sits in barcoded boxes on Microsoft’s virtual shelves and the hardware needed to drive it sits in almost every person’s pocket. This adds up to a readily accessible weapon of mercantile mass destruction. There never has been a more potent form of commercial ambush than the smartphone – and tablets and watches and all those interconnected devices that make up the Internet of Things.

But in itself, disruption is nothing new. A sharpened stick was the wonder of its age. Enterprises that carved and shipped raw ice from the flanks of mountains didn’t figure on mechanised ice factories, and in turn, ice factories saw household refrigerators as a fad. Not one ice farmer became an ice factory, and not one ice factory became a supplier of refrigerators.

Kodak believed itself invincible in film – which was fine for as long as film was necessary. The point is that fundamental shifts that once spanned a century or more are now being compressed into a matter of years and months, and the rate of change will continue to accelerate as far down as weeks.

I believe that during the next five years, the majority of existing enterprises will in some way be wrong-footed by the competitive opportunism made possible by digitisation. In 60 months, many businesses currently succeeding will be living on the vestiges of their legacy or have failed. Some – like Kodak – will continue to rule their niches, but it becomes a matter of relevance, ie number one of what? My forecast is for commercial carnage, and you might ask how I can be so sure of it.

For the past 10 years I have served on the 20-person Worldwide Partnership Council to Microsoft in the USA. Our job is to act as a sounding board influencing allocation of its $10+billion per annum research fund and the focus of its tens of thousands of developmental engineers. My company is also one of few entities invited into the Workplace by Facebook partner program. So I’m exposed at the coalface to what’s coming in the next five, ten, twenty years – the science fiction becoming real in labs as I write.

But let’s return to the right now of it.

There’s a beehive of buzzwords surrounding digital transformation, but the nub of it is staying in tune with and leveraging society’s obsession with smart devices. And it’s not only consumer world in play. It’s staff members, project teams, suppliers, consultants, franchise partners, stakeholders, influencers and all the periphery, and it doesn’t matter whether it’s administration, operations, product development, marketing, customer relationships, supplier support, delivery, communication, collaboration or any other card in the deck. If it cannot be sourced and progressed in the moment on a smartphone, it will lose relevance.

Like it or not, every business is now in part a media operation concerned with dissemination, influence and growth of audience, and already there’s a wealth of examples of occupations and business models that are struggling.

Take the old-school new-car salesman living on his wits. Today we walk into his showroom knowing what model we want and the price we can get it for elsewhere. And when he trumpets the excellence of his after-sales plans we point to six reviews on our smartphones saying that the service here stinks.

On the other side of that coin, the sales assistant greeting you (at just the right moment) in a fashion outlet will be wearing designer glasses that scroll through any combination of who you are, where you live, your buying history, previous heat-signature-mapped patterns in the store, an approximation of what mood you’re in, whether you’ll demand a discount and that you prefer the colour blue. It’s evolution. Moths come up with a jamming defence and bats find a way to beat it – and repeat. It’s never going to be static.

These kinds of market developments already are knowns: an ecosystem where television commercial breaks have become welcome opportunities to mute the monitor and access the tablet or phone. Where your product or service can be sourced, researched, reality-augmented, compared, priced and ordered with minimum effort. A great many businesses are headed up this track and seeing light at the end of the tunnel.

The question is what happens when that welcome circle of light turns out to be the headlamp of an oncoming train.

Your task ​

What opportunities for deeper digital engagement does the information above suggest to you in relation to your SME?

What are the likely impacts on the performance of your SME if you were to take the next step in terms of deeper digital engagement?

Share this article:

This article is from the free online course:

SMEs and Digital Engagement

Deakin University

Get a taste of this course

Find out what this course is like by previewing some of the course steps before you join: