Padraig Sheerin, head of SME at Three Ireland
Recent research conducted by Three has revealed the evolving nature of Irish SMEs’ approach to investment in technology and how they want to make it work for them
More than two-thirds of SMEs surveyed for Three’s latest Irish Business Mindset Report see technology’s role as central to their business priorities and growth strategies.
Whereas in the past, the technology would have come first, now the business objectives are top of the agenda, followed by the adoption of the technology which will help the company to achieve them.
“Businesses are no longer simply deciding to move to the latest updated platform,” says Padraig Sheerin, head of SME at Three Ireland. “They are taking a step back to look at overarching business objectives. Depending on that review, they are looking at where technology can play a role in addressing challenges and tapping into opportunities. It means that the solution they end up with might be different to what they’re used to.”
This is the second time Three has produced its Irish Business Mindset Report. One response that has changed significantly relates to the areas in which Irish businesses plan to make their technology investments.
In the 2016 report, around one third of businesses surveyed were going to focus on ‘business operations and infrastructure’; this has now increased to half of respondents. At the same time, planned investment in ‘marketing and sales programmes’ and ‘collaboration’ have both fallen (from 51% to 38% and from second- to third-most selected, respectively).
“This shift is bringing more balance across these areas. It means that investment in operations and infrastructure is more tied into the drive for growth within companies,” says Sheerin. “SMEs are trying to find new ways to really make strides ahead of where they were or ahead of their competitors.”
The fall in investment in sales and marketing programmes doesn’t mean this area is of any less importance, he adds. “Companies are challenging the traditional approach to sales and marketing campaigns. More respondents have been posting videos to YouTube and using a CRM system, but fewer have been using email marketing. In some cases, their investment in improving online infrastructure for example is allowing them to sell online.”
The number of SMEs in the survey which rely on blogs and forums for their information has more than doubled in the past year, while the percentage that rely on advertising to learn about products has halved.
Into the cloud
When it comes to the cloud, SMEs are tapping into this area more and more as the cost of switching to cloud solutions is so much lower than it used to be, according to Sheerin.
Penetration of ‘internet-based voice’ among Irish SMEs has grown from 34% to 40%, while use of the cloud for ‘virtual meetings’ has risen from 21% to 25%.
Businesses are realising they can lose the legacy costs of PSTN line rental by moving to cloud telephony, and at the same time can meet the demand from employees for greater mobility with virtual meeting capability.
“In the past, cloud-based solutions were seen as something that only large corporates could afford or have the ability to adopt,” notes Sheerin. “Now they are fully accessible to smaller businesses, from microenterprises right up. Investments in cloud-based solutions are often linked to companies looking to upgrade their IT systems generally – by default they’re moving to the cloud as part of that investment.”
File storage and sharing is still the most-used cloud service, with 66% of those surveyed using it last year. “The decision to opt for an offsite cloud solution for storage means small businesses can strip out the costs associated with maintaining equipment onsite,” Sheerin explains. “It involves a much more tailored model and billing system. Companies can avail of automated upgrades on an ongoing basis so the version they’re using is always the most up to date.”
Two-thirds of those surveyed believe they are more proactive than other similar businesses regarding technology investment decisions. That’s a slight drop on 2016, but still confirms that technology investment for most Irish businesses is not just a vague aspiration but an important and practical step to take.
“Irish SMEs are back in growth mode. A lot are hiring and attracting talent is high on the agenda along with a focus on renewed domestic growth. Almost threequarters of those in our mindset survey are looking forward to a positive future for business in Ireland,” says Sheerin.
“Investments in cloud-based solutions are often linked to companies looking to upgrade their IT systems generally – by default they’re moving to the cloud as part of that investment”