SAN JOSE, Calif., Sept. 9, 2020 /PRNewswire/ --
According to the new eight country 2020 Small Business Digital Maturity Study, small businesses could add $2.3T to these market's overall GDP by 2024 while contributing to the economic recovery during and post pandemic. The study conducted by IDC, and commissioned by Cisco, examines eight countries throughout June 2020 (United States, Canada, Mexico, Brazil, Chile, United Kingdom, Germany and France) to better understand the opportunities and challenges small businesses currently face and the correlation between digital maturity and faster recovery. Together these eight economies could also increase by 5.5 percent and enjoy a 42 percent faster growth rate through increased small business digitalization.
To understand the maturity level of small business digitalization, IDC developed a framework that helps small businesses clearly assess their current capabilities, and understand where they are on a four-stage digital index - ranging from the earliest stage of Digital Indifferent to the most advanced group of Digital Natives. This study is an extension of the APJC SMB study released in July.
"The COVID-19 pandemic has exacerbated the digital divide that was already present in the small business market, and it is forcing companies to accelerate their digitalization," said Daniel-Zoe Jimenez, AVP, Head Digital Transformation & SMB research, at IDC. "Small businesses are realizing that digitalization is no longer an option, but a matter of survival. While the research shows many small businesses are making progress, they should increase focus on digitalizing processes and operations through the use of digital technologies to ensure business continuity and future resiliency".
Small Businesses Range When It Comes to Their Digitalization Journeys
When it comes to the four-stage digital maturity index, small businesses range with surprisingly only 25 percent surveyed in the most advanced stage (stage four) with four percent still in stage one/digital native stage.
When it comes to recovery during and after the pandemic, small businesses that are in the more mature stage three and four have the highest ratio of recovering, are able to respond faster to changing market conditions, and are growing their revenue at higher rates.
Small Businesses Know Technology is Key to Recovery, But It Doesn't Come Without its Share of Challenges
COVID-19 has only heightened the fact that digitalization is no longer a choice for small businesses, it's a necessity.
While digital technologies are more widely available today and help level the playing field, small businesses face constraints on many fronts.
Small Businesses are More Dependent on Technology and Will Be Investing in Key Areas
This crisis has made small businesses more dependent on technology and aware of the importance of digitalization.
When it comes to technology investment during the next 18 months, small businesses are planning to invest in cloud solutions, as well as build on-premises infrastructure, both software and hardware.
Recommendations for Small Businesses:
Small Businesses around the world are learning how to adapt to the current climate, overcome challenges and adopt technology that can help them not only survive this crisis, but thrive long after it ends. However, the first question for many is, "where do I start?" Cisco and IDC recommend the following to build resiliency.
About Report Methodology
The 2020 Small Business Digital Maturity Study gathered and analyzed data from over 2,000 small businesses across eight markets to assess the challenges and opportunities the companies face in their digital transformation journey and in light of COVID-19. The eight markets include, Brazil, Canada, Chile, Germany, France, Mexico, United Kingdom, and the USA.
The Small Business Digital Maturity Index is made up of four dimensions: Digital Strategy and Organization, Digital Processes and Governance, Digital Technology, and Digital People and Skills. Each dimension targets an essential aspect of digital mastery and can be assessed independently as a measure of the relative maturity of a specific aspect of business functionality and performance, providing goals for small businesses to target on their digital transformation journey.
Four stages of digital maturity
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