Research shows big businesses are positive as SMBs struggle
New research from 2degrees reveals that small businesses have had a rocky ride in 2022
In 2022, Aotearoa’s business leaders have faced a host of challenges, from soaring inflation and rising interest rates to a lack of available staff. Across the board, companies have struggled, though small businesses appear to be having the toughest time, according to 2degrees’ latest Shaping Business Study.
The annual survey, which gauges the mood among more than 700 Kiwi business leaders, concluded that large and small businesses had differing experiences of the past 12 months. SMBs are the least optimistic about the year ahead, while big business is more positive about 2023.
The major study conducted by 2degrees offers deep insights into our smallest companies and biggest corporations. It reveals that larger businesses have been able to weather the storm more effectively than SMBs, relying on their scale to get through the worst of this year’s crisis.
“Only 31 per cent of small business leaders (employing 20 people or fewer), felt optimistic about their prospects, and 43 per cent of leaders of medium-sized businesses.”
How are Kiwi businesses faring?
According to the findings, only 36 per cent of business leaders feel more optimistic about their company compared to a year ago — a 4 per cent drop from 2021. Roughly 31 per cent of bosses felt less optimistic, while one-third thought they were in the same position.
Only 31 per cent of small business leaders (employing 20 people or fewer), felt optimistic about their prospects, and 43 per cent of leaders of medium-sized businesses. Bigger businesses had a more positive outlook, with more than half (57 per cent), feeling hopeful.
Overall, three in ten business leaders said better-skilled staff would help their business thrive, with cashflow and hiring staff the main concerns for roughly one-third of respondents.
The future of work
The pandemic has changed our working lives forever, and NZ companies reflected on the future of work in the study.
Nearly half of business leaders said they had adapted their working model since the Covid crisis, to incorporate adjustments like hybrid and remote working. Businesses also said they had begun to collaborate more online with employees and external partners.
Amid full employment and difficulties in hiring staff, attracting talent remains a primary concern. Employers are adapting to the challenges by putting people first — offering sweeteners to new hires, with perks such as extra leave and training options becoming more common, alongside flexible working options.
Has working from home worked?
As business models adapt, our companies have become more productive. The 2degrees study revealed that businesses who adapted their ways of working saw positive results, with 38 per cent citing improved productivity.
Of the companies that had changed their working models, 50 per cent noted an increase in their ability to innovate, underlining the advantages of embracing the future of work. The findings suggest there are advantages to the new way of doing things.
Productivity focus
Kiwi companies are more focused than ever on productivity gains since the Covid crisis.
61 per cent of businesses that prioritise productivity are likely to invest in better use of technology, and
48 per cent of companies are increasing salaries and flexible working arrangements to attract the right staff to make a difference.
Half of large companies surveyed said they had enjoyed an increase in productivity over the past year. But overall, mid-sized companies were more likely to put the highest emphasis on improving productivity levels.
Digital growth and innovation
How are New Zealand businesses embracing digital growth and innovation? The survey reveals most employers believe technology can improve their operations.
A total of 62 per cent of business leaders in Aotearoa believe they possess the right digital skills to get ahead of their rivals, compared to just 24 per cent, who say they lack the skills.
Those without digital skills want to improve. A total of 34 per cent would like to upskill, but don’t have the time.
Companies see the value in adopting digital tools. Nearly two-thirds (64 per cent) of respondents said technology improved their ability to operate. The average Kiwi business uses 4.2 digital tools in the workplace, according to the study.
2degrees has shared its latest annual Shaping Business Report as part of its ongoing commitment to a thriving business environment in Aotearoa. Read the survey at 2degrees.nz