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Getting small business people to answer questions, much less surveys, takes hard work and perseverance. So let me congratulate tech supplier CDW for making that effort on a regular basis. The report the company sent me at the end of last year has some details worth examining.
CDW reports small businesses lag behind larger companies in using technology to help grow their business. True, but the same could be said about the amount of attention paid to advertising, marketing and the size of the sales force. Small businesses lag in all these areas, and you can point to any of these as the reason for slower growth.
Whether use of technology is the primary factor limiting growth isn't clear, at least not to me. If you have $500, should you buy more advertising or buy a new PC? Advertising will almost certainly get a better return in the short run.
Let's look at some survey details and see if lack of technology is the reason small businesses stay small. First of all, just over half of small businesses say IT improves their financial performance and/or efficiency, while 69% of midsized businesses and 71% of large businesses say they see an improvement.
At first glance, you might say small businesses are neutral about technology (52% see improvements while 48% report seeing none) because they don’t use it correctly. I see that at times, because they don't have money for the best technology nor the employees to best put new technology to work.
Yet small business employees spend more time actually doing things, like manual work, than employees in larger companies. Large American companies rely heavily on knowledge workers, not workers building houses or roads or repairing cars or cleaning clothes. Knowledge workers spend their day with technology, so any improvement helps them. A new office computer for the auto body shop doesn't replace crumpled bumpers faster.
I have friends working for a small local newspaper. Those laying out the paper on computers will see an increase in efficiency if they get a new computer and better software. They'll lay out the paper faster, saving them time. Technology helps their job.
Those delivering the papers to yards all over this suburb won't see that efficiency. They’ll get a better return by getting a new truck and improving gas mileage. The two groups could meet in the middle if new routing software could be used to plan a more efficient delivery route. If you surveyed both groups, I bet the ones slinging papers into yards see no efficiency in technology, while those in the office love it.
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